Deven Choksey Stock Research Report

Uno Minda Limited, established in 1958, is a leading global manufacturer of automotive solutions
and systems, supplying Tier-1 components to OEMs. The company specializes in automotive
switching, lighting, acoustics, seating systems, and alloy wheels. With over 73 manufacturing plants
worldwide and a strong focus on electric vehicle technologies, Uno Minda is committed to
innovation and sustainability in the automotive industry.

Broad-based revenue growth, except for the Acoustics and Seating segment

In Q3FY25, Switching revenue (25.0% of revenue) stood at INR 10,450 Mn, growing 12.6% YoY but
declining 1.1% QoQ, supported by higher kit value and a strong recovery in the two-wheeler segment.
Lighting revenue (23.5% of revenue) came in at INR 9,820 Mn, up 15.3% YoY and 1.2% QoQ, aided by
robust demand across 2W and 4W OEMs, new launches, and capacity expansion through the Khed lighting plant. Casting revenue (18.4% of revenue) grew 12.0% YoY to INR 7,680 Mn, though down 8.8% QoQ, led by increased capacity, particularly in 2W alloy wheels. Seating revenue (6.5% of revenue) stood at INR 2,730 Mn, down 0.4% YoY and 4.5% QoQ, due to weak European exports despite domestic growth in pneumatic seat supplies. The Acoustic segment (4.4% of revenue) reported INR 1,840 Mn in revenue, declining 8.9% YoY and 1.1% QoQ, impacted by softness in the European auto market affecting Clarton
Horn operations. The company remains positive on long-term growth, supported by strong domestic
demand, rising EV adoption, new product launches, and continued investment in technology and capacity
expansion.

Improved operational efficiencies led the YoY profitability

The gross margin for the quarter stood at 34.5%, decreased by 46bps YoY (-61bps QoQ) due to higher raw material costs. For Q3FY25, the company’s EBITDA stood at INR 4,570 Mn (+20.4% YoY/-5.3% QoQ). EBITDA margin increased by 15bps YoY (-44bps QoQ) to 10.9%. The YoY growth was driven by higher revenue, improved operational efficiencies, and cost optimization initiatives. PAT for the quarter increased by 20.2% YoY (-5.1% QoQ) to INR 2,326 Mn, showing robust revenue and operating performance.

Uno Minda strengthens EV focus with expansion, innovation, and strategic partnerships

Uno Minda reported strong Q3FY25 performance, driven by a 45% YoY rise in EV revenue to INR 2,380 Mn and double-digit growth across switching, lighting, and casting segments. Backed by a robust INR 27,900 Mn capex for FY25E, the company is expanding capacity in alloy wheels, lighting, and EVs. New plants at Kharkhoda and Supa are expected by FY26E. Revenue from controllers and ADAS stood at INR 3,590 Mn. Despite CV and export headwinds, strategic tie-ups, tech-led product diversification, and PLI-led policy tailwinds support a strong long-term growth outlook.

We expect Revenue/EBITDA/Adj. PAT to grow by 20.8%/ 23.4%/ 27.7% CAGR over FY24-27E. We apply a P/E multiple of 39.0x on FY27E EPS of INR 31.0, resulting in a target price of INR 1,208/share. This implies a left-over upside of 35.7% from the CMP. We have a ‘BUY’ rating on Uno Minda Ltd. since 7 th Feb 2025.