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Greaves Cotton Ltd
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Ladies and gentlemen, good day, and welcome to Greaves Cotton Limited Q3 FY '23 Earnings Conference Call. From the management, we have with us Mr. Nagesh Basavanhalli, Executive Vice Chairman; Mr. Dalpat Jain, Group CFO; Dr. Arup Basu, Managing Director, Greaves Cotton; Mr. Sanjay Behl, CEO and Executive Director, GEMPL.[Operator Instructions] I now hand the conference over to Mr. Nagesh Basavanhalli, MD and Group CEO of Greaves Cotton Limited. Thank you, and over to you, sir.
Thank you. Good afternoon, everybody. Thank you for taking the time. Good evening, and welcome to the Q3 call. At the onset, as the industry and we, as a company, are transitioning from our metal base to -- metal base engineering company to electric electronics mechatronics type of a company, we are glad to announce that today we have signed a binding term sheet for the acquisition of Excel Controlinkage Private Limited, one of the key players in the areas of mechanical and electronic motion control systems. The highlights of this acquisition is that it's a very profitable business. It offers complementary product portfolio with several different customer and industry segments. It fits in with the overall green strategy of transitioning to the mechatronic and electronic capabilities. It also helps us with our export and other opportunities for the future.While we get into the more details in the Q&A on this, we also would like to talk about other things that have happened in Q3. We just concluded the Auto Expo last month, where Greaves Electric Mobility showcased 6 new products, both in the 2-wheeler and the 3-wheeler. Greaves Cotton showcased the e-powertrain offering. All of these products are innovation, led by our in-house design engineering teams, bear testimony to our purposeful stride in terms of emerging as a stronger player in the last mile mobility ecosystem with forward-looking products and technologies.In this past quarter, we also partnered -- Greaves Cotton also partnered with a U.K.-based design firm, EPA Green Power to bring in exclusive technology in the electric powertrain. We also, in the last couple of months, launched the "Har Gully Electric" campaign for Ampere at the Auto Expo, which has received overwhelming response. We have also announced the launch of Primus product this quarter.We are optimistic about the sustained growth with some of these new developments. We also see that the recent budget has been very encouraging when it comes to green growth as laid out in the recent budget of '23. As India transitions towards a sustainable mobility, we continue to keep pushing a lot of new products and areas that the company is focused on both in GCL and in GEM.With that, let me hand it over to the CFO to discuss the Q3 financials. Happy to take the calls at the end. Thank you.
Thank you, Nagesh. Good afternoon, everyone. I'm sure you would have got the financial results for Q3 of FY '23. Just a few key highlights. If you look at the consolidated revenue of the group, we reported total revenue of INR 514 crores, which is 6% higher than the same quarter of previous year, but lower than the sequential Q2, and main reason being, like we had spoken about it in the previous quarter, in the electric mobility, particularly for 2-wheelers with the new guidelines on AIS-156 for the battery. The products were made according to the new guidelines. And by the time the production restarted, we had to recalibrate or basically strategically halt the production during the quarter. So that, in fact, impacted the primary revenue, which will be made up as we go into subsequent quarters.So if you look at the breakup of consolidated revenue of INR 514 crores, INR 365 crores came from stand-alone business and INR 142 crores was the consolidated revenue of electric mobility. The good news is, as I was mentioning, with the production restarting in January -- in the month of January itself, company has done in the electric mobility, the same revenue that we did in the entire quarter of Q3. Company dispatched more than 14,500 or close to 14,500 vehicles in the month of January itself.The secondary volume continued to remain strong in the Q3. And as we go forward, overall, with the new launches that are planned, we expect strong momentum in our e-mobility volumes and revenue.Overall, at EBITDA level, if you look at the core business, the margins continue to improve. The commodity cycle is helping with the overall prices coming down. The raw material cost for a stand-alone business was less than 70% and EBITDA margins have moved back to double digit. We're happy to report 10.7% EBITDA margin at stand-alone level during the quarter.In Greaves Electric Mobility business, because of lower revenue and the fixed costs which are already built for the higher volume and business, we had a loss at PBT level. The expenses also included a one-time cost of INR 8 crores for a particular share-based payment done during the quarter. So overall, at electric mobility level, we had a normalized PBT of -- negative PBT of INR 28 crores at a consolidated level, positive EBITDA of around INR 10 crores on a recurring basis and stand-alone EBITDA was INR 39 crores, which is 10.7%.Company's balance sheet continues to remain strong. We had a total cash and cash equivalents of INR 1,171 crores at a consolidated level and with the binding term sheet that has got signed for acquisition of 100% stake in Excel controlling case in 4 tranches. We will be using some part of our internal accruals and free cash. Positive thing is the target company is highly profitable with normalized EBITDA margins of more than 28%, and with a significant scope for growth in the push-pull cable segment where they operate.With that, I will be happy to take questions. Maybe, Aman, you can open up the floor for questions, please.
[Operator Instructions] First question is from the line of Ashutosh Tiwari from Equirus Securities.
Firstly, on this Excel Controlinkage acquisition, can you throw more light in terms of where we basically -- it gives us synergy benefit and which kind of customers we can target with this? It's a quite profitable business that we have seen in the PPT, but where it fits in our kind of business?
I'll start and maybe Dr. Basu can add. So clearly, they are in the business of push-pull cables. They are in the area of levers, steering and transmission systems, electronic throttle levers, pedals, right? They are in the higher-margin segments, which include basically the commercial vehicles, construction equipment, marines, SPV, et cetera. Roughly 30% of their business comes from international, 70% is from domestic. Obviously, they are dealing with most of the auto majors in the country. I'm talking about the -- from a commercial vehicle standpoint, maybe with the exception of 1 MNC, right? So there is obviously B2B synergies. There is supply chain synergies. It's incremental product because also going forward, there will be a lot of work in the area of sensors and the sensors, which will go into both traditional engines as well as electric vehicles. So when you look at that, it's -- the product portfolio is vast. Industry segments that they operate is quite immense, and then the opportunity to kind of have headroom is quite significant. Dr. Basu?
And they make their own sensors or how it is?
Yes. So this is Arup Basu. So as Nagesh said, there is a common set of customers in terms of the segments that we both play in in terms of auto, industrial, agri, marine and so on. The sensors are the electronic version of the motion control. You have push-pull cable rods and electronic sensors. These are the 3 large types. And while the majority of the product portfolio is in the cable construct, there is work already underway to move to sensors as and where applicable. And that's another point of synergies because sensors, this is one application of sensors in terms of motion control. It's applied to a very large segment of applications, including any prime mover requirement.
And if you look at the PBT, I think the company has grown very fast over the last 3 years, [ INR 100 crores to INR 167 crores ]. So why the promoters are willing to sell? That's one thing. And second, like what drove this growth stronger over the last 3 years? And how do you see the scale up of this?
Yes. So I'll take the first couple of questions, Ashutosh. The promoters, obviously, it was part of their planned exit. They have been in the system for a while. There was a succession planning issue. And they wanted a bigger, stronger group to come in and take over the business. So it was part of their planned exit strategy, right, point number one. In terms of the growth, you're right, if you look at the last 3 years CAGR, it's roughly about 22%. And they have put in the investments, I believe, back in CapEx investments back in 2019, which really puts them in good stead that kind of gets them ready for the next couple of years, right? They have deep relationships with OEMs. They get engaged very early on in the process. And this has been built, this business has been built over decades and [Indiscernible]. And in terms of cost, ownership, profitability, very strong focus on that. So a lot of cultural alignment, sectoral diversification, geography diversification, right? And obviously, they have 5 small plants in and around the Nagpur area. And hence, that was the rationale behind it. Feel free to add on that.
And mainly the growth has been from export segment as well as the overall recovery in the auto that we have seen, and that has also led to the fast growth of their -- and their products are mainly proprietary technology. So to that extent, once they have gone into the OEM design overall, that continues to remain as the only product available as the option there.
Okay. And secondly, on the EV side, while the primary sales is very strong in January, is it also reflecting the secondary sales that we're seeing now that also is on similar line?
Directionally, the secondary -- Sanjay, do you want to take it up? Sanjay?
Yes. Yes, I'll do that. So I think the -- primary was very, very strong, obviously as the numbers have -- Dalpat said have been already crossed the entire quarter. Secondary sales is picking up. The first spotlight of January, given the inauspicious period as you know, most parts of the country was a little lukewarm. But we've seen very good response in the last 2 weeks of January. So currently, we are trending at almost the highs of -- festivity kind of highs in the last about 3 to 4 weeks. So last fortnight of January, very good. First fortnight of February, again, a little modest but picking up now, and we are very hopeful that our secondaries are going to be better than the last -- significantly better than the last quarter.
Yes. And how would this AIS-156 transition fully after -- after that, how will that impact the cost of this? In terms of cost, how much cost will be required to pass on the whole impact?
We've already absorbed the cost. Most of the costs have already been absorbed in areas of Phase 1. The range is from player to player anywhere between INR 2,500 to INR 3,000, which is bad. But more importantly, the transition has happened successfully for all the products of Ampere, whether it's Magnus EX or Zeal EX or Zeal [ Reo ], the 3 products on the road today. All of them are fully compliant with AIS-156 and fully compliant on same norm. So they are all compliant and there is a marginal cost, which has already been absorbed in the product.
[Operator Instructions] The next question is from the line of Dhananjay Mishra from Sunidhi Securities.
So just the expansion of last question. So when we really implementing the Phase 2 of the battery standard, so again, our timely sale will be impacted or maybe in April? Am I correct?
Yes. So just to add on to the last one also, part of the cost is also getting utilized by the price increase that we have taken across our portfolio, just to finish that. So I think that part is there.Coming to your AIS Phase II question, we are currently in a preparation mode already for our transition to Phase 2. The cutoff is 31st of March. So we are getting ready for almost all the product lines that we have to transition seamlessly without any hiccup in primary and secondary sales. That's the current readiness that we are working towards. So we don't anticipate any major disruption at this point of time.
Okay. So 10,000 monthly sales can be assumed for the subsequent month?
Yes, it's hypothetical speculative thing, we won't say that. But yes, in the current -- the thing is that we should have a seamless transition from AIS Phase 1 to Phase 2.
And secondly, in terms of subsidy release, where we are placed -- I mean anything we are hearing from government when they're going to release subsidy?
So we're working with the government. I think we have given all the requirements that the government authorities have asked from us, and we are working actively with the government to get it released.
Okay. And lastly, this acquisition, this EV -- enterprise value of INR 385 crores we have paid, that is for the 100%, right, or it is for 60%?
So Dhananjay, that's correct. So the 100% of the enterprise value will be kept at INR 385 crores. That's the maximum value, which we can determine this is the actual EBITDA of FY '23. And they are on the path to cross INR 50 crores of EBITDA. So that's where the final value will come out. So 60%, we will pay -- if the final value comes to be INR 385 crore, then we will pay INR 231 crore for the 60%, which is the Tranche 1. And then Tranche 2, Tranche 3 and Tranche 4 will get determined at the end of FY '24, FY '25 and FY '26.
And when do you expect this Tranche 1 to be completed?
The Part 1 closing to get completed by April. That's what [Technical Difficulty] --
Sir, we are unable to hear you. Can you hear us? [Operator Instructions] Ladies and gentlemen, thank you for patiently waiting. We have the management line reconnected.
So Dhananjay, I heard the question on the enterprise value. So basically, that's INR 385 crore for 100%. So 60%, it will be maximum of INR 231 crore, depending on the final EBITDA determination of FY '23. And the remaining -- the closing expected is by April 2023 for the first part of the Tranche 1 payment. And the second tranche of the Part 1 payment will get completed by August 2023.
So FY '24, we will have full impact of this consolidation in our P&L, right?
That's correct. Of the stake that we are subject to, obviously, the definitive documents on the -- and other regulatory approvals by -- in FY '24, we should have a full consolidation effect of the 60% stake that we will have.
The next question is from the line of Jiten Parmar from Aurum Capital.
Congratulations on what seems to be a good acquisition. My question is also on 3-wheelers. What is the situation there?
So basically, in terms of the overall revenue and the market part of the MLR plus Bestway?
Yes.
Sanjay, you want to add to that?
You want me to take it, okay, that's fine. So we've been steadily improving on 3-wheeler, both in L3 and L5 segment that we have. Last quarter, we have actually done the highest ever L5 volumes and also continue to improve our position or sustain our position of a very good Q2 that we registered. So almost the same number we repeated. Despite the market, some slowdown was there in L3 in Q3, we were able to hold to our volumes there and grow significantly in L5. So that would be the broad contours there. We are increasing in number of active dealers. The financing partner is also improving every month. So overall, if you look at all the enablers, whether it is in terms of product getting more accepted in the market, the number of dealers who are engaged with us, the financing partners. Overall, I think the ecosystem is coming together and we will continue to be very confident, we'll continue to see higher growth in the coming quarters in 3-wheeler segment.
Okay. And my second question is, maybe you might have answered it, but I probably missed it. Regarding the volumes for EVs, which were very low in, I think, November and December or rather for the whole quarter. Is it because of the AIS Phase 1 transition? Or what is the reason behind that?
Yes. In fact, it's a quarter that you have to see it from the right perspective, I would say, because in terms of secondaries and Vahan registration, it was the highest ever quarter of Greaves, yes, which is the reason. The primary billing was low on account of what I think was already mentioned in the context and also repeated by Dalpat, which is the switch over from AIS-156 Phase 1, which happened on 1st of December. So we had to do a transition from a pre-AIS vehicles to the post-AIS vehicle. And hence, we had to do a lot of liquidation of the pre-AIS stock. So we had to work with that as one of the transition imperatives during the quarter for which the billing was lower. But in terms of secondary sales, if you see -- it was one of the highest quarters and even in Vahan registrations, if you would have seen, we crossed 27,000 registrations. And in fact, are the highest ever market share reported by Ampere. It was in the month of November, which crossed 16% market share with electric vehicles, which is a reflection that the market acceptability of the brand product, everything continues to be extremely high, only improved during the last quarter. It is only the transition-related billing.
And that also got again filled in the month of January. So January, in that month the quarter's volume completed.
Perfect. So I think there will be probably low inventory at the deal front and all that? So maybe that.
That's correct, Jiten.
Correct.
[Operator Instructions] The next question is from the line of Anand Venugopal from BMSPL Capital.
So my question is, there's a lot of pessimism in the 3-wheeler industry in India, and we realize it's the essential part of transport system. Do you think the market is underestimating the power of next up cycle in 3-wheeler industry? Can we see higher volumes in the next up cycle versus the previous upcycle?
Yes. I'll take this and then maybe Sanjay can add. When you look at 3-wheeler industry, right, moving people and moving cargo, the passenger and cargo, right? [Technical Difficulty] as a general group advantage, because not only we supply engines through a series of automakers on one hand, but from a life cycle value extraction, we supply 3 wheelers, both L3 and L5, L3 at the lower end and L5. Sanjay already alluded kind of where we are. But if I take a step back, the industry size, basically L3 and L5 is more or less when you look at the monthly sales and the trending annual sales is more or less the same, right? L3 has been growing significantly. L5, which was significantly impacted during the -- basically the 3-wheeler traditional business, which was significantly impacted during the COVID era is recovering, right? Totally, the industry size is about roughly 700,000 when you add up both, right, L3 and L5. And we believe in terms of moving people, moving cargo and opportunity for a fuel agnostic way, wherein we are available in diesel engines, we are available in CNG engines on the Greaves side. We are available in L3. We are available in the 3-wheeler L5 segment. So we got that industry segment covered, and we are seeing the positive trend of that industry moving back. It's obviously not fully recovered to the pre-COVID on the L5 area, but definitely it's moving in the right direction. And I don't -- I think long term, this will be a strong area, especially.
The next question is from the line of Rohit Bahirwani from Vijit Global Securities Private Limited.
If you look at the subsidies, it was around INR 116 crore as on 31st March 2022. How much subsidies are receivable as on 31st December '22? And how are you looking at the subsidies in the future?
Yes. So Rohit, in terms of the absolute amount, the receivables subsidy has now gone above INR 225 crores. So that's the total receivable subsidy from the government because last 5 years -- sorry, 5 months, we have been asking for the details and processing that. In terms of the status, Sanjay already spoke about it, to the agencies all the details have been provided and company is working with government to get that released as soon as possible.
Okay. And my other question is related to AutoEVmart. The company has 2 stores of AutoEVmart in Bangalore and Trivandrum, respectively. How much revenue contribution is there from AutoEVmart? And company sells the products of different brands. So do you bill the sales in your accounts? Or is it the incentives and commissions? Can you explain a bit on that?
Yes. So overall, in terms of the financial numbers, the sales that we do for the OE is on principal to principal relationship. So basically, the entire sales get recorded. In terms of the contribution in the green -- stand-alone revenue and the consolidated revenue, it is less than 3% right now of the total vehicle sales.
Less than 3% of total consolidated revenue?
That's correct.
The next question is from the line of Subrata Sarkar from Mount Intra Finance [Operator Instructions].
Yes. Sir, I have a very basic question since my understanding is a little bit limited. So like if I want to track the primary and secondary monthly sales for your company in terms of electric -- EV there, I'm talking about, 2-wheeler and 3-wheeler. What is the basic source to check it? And sir, just another request, like I have said that we are not disclosing the monthly data, basically, like several other traditional auto companies or 2-wheeler company does. So is there any specific reason for that? So if you explain that a little bit?
Yes. So Subrata, 2 parts of your question. One, in terms of the secondary sale. So for secondary sale, there is a database with Vahan. So Vahan total gives you data of the registered vehicles. Obviously, there are certain -- normally in the sense of time gap, because from the time the vehicles are actually sold to the customer and till the time it is registered, to that extent the Vahan database updation gets delayed. The second piece is there are a couple of states which Vahan database doesn't -- [Technical Difficulty] --
Ladies and gentlemen, we have the management line reconnected. Sir, over to you.
Yes. So Subrata, I was talking about Vahan portal being the source for the secondary sales and subject to certain things, which are like a couple of states are not covered. And the second registration may take a little time from the point then the actual secondary sales happens. So to that extent, that Vahan data can be readjusted and you can have a monthly or the live data about how many vehicles have got -- in the secondary market.About the primary data, we disclosed that on a quarterly basis. So that's the information available in our investor presentation for every quarter. Talking about why monthly, we don't do that because we believe in getting the volume data audited, certified and then disclosing that. So to that extent, the internal view from compliance is slightly different on disclosure of it. And that's where we've disclosed it on a quarterly basis, and volumes are available in our investor presentations for -- since the time company started selling electric vehicles.
Okay. Sir, another very basic question, like with our existing capacity like existing plant, what is our optimal capacity, like how much we can go in terms of both 2-wheeler and 3-wheeler?
Yes. So on 2-wheelers, as you know, we have a megasite at Ranipet. It's a 35-acre plant. The entire brick and mortar can go up to 1 million unit capacity. Right now, the production capacity that we have installed is for 250,000 per annum in a single shift. With multiple shifts, the capacity can go up to 400,000 and 450,000 per annum. So that's the installed capacity on 2-wheelers. On 3-wheelers, between both L3 and l5, the individual -- so L3 had close to around 3,000 vehicles per month. And similarly, L5 also is around the same number in terms of installed capacity.
We have the next question from the line of Rohit Bahirwani from Vijit Global Securities Private Limited.
Sir, I had one question with respect to the secondary sales for electric 2-wheeler, if we look at Vahan portal. There are 2 data lines available, one for Ampere and another named Greaves Electric Mobility Private Limited. I understand the first one is for Ampere brand. What's the other one for?
So both are the same ones. I think when the company registered, name got changed from Ampere Vehicles to Greaves Electric Mobility. So to that extent, the registration data when they are happening under 2 names, that's the data what is getting reflected over there. But from a company point of view, both of them together is what we need to see as the total volumes. Both are for Ampere-branded vehicles only.
Okay. And with respect to battery, are you sourcing the batteries from Indian OEM? Or are you importing from outside?
Sanjay?
The lithium ion battery.
Yes, all the batteries, assemblers are all Indian batteries. Cells of the batteries are imported, but all the batteries are assembled by Indian suppliers for us.
[Operator Instructions] The next question is from the line of Aniket Mhatre from HDFC Securities.
So we did understand why your sales went down in Q3. But what I fail to understand is why your secondary sales have declined in January. Could you please explain that?
Yes. Let me start, and then maybe, Sanjay, you would like to add. So while the primary sales were on hold, that's where the inventory at the dealer level got reduced. So Sanjay, you wanted to say something? Sorry on that.
Yes. No, no, no, absolutely. So it's really -- I think Dalpat said there, there is a Vahan registration number, which has a lag with secondary sales. Because when you sell it to the customer, customer then either through a dealer or through some -- directly goes to an RTO to register a vehicle. Registration, depending on the state can happen the same day or can be delayed by 45 days in some states. And all the registrations don't get accounted for in Vahan portal. So the number that you're seeing for January is a number of registrations which happened in January, which would have some lag of December really getting impacted then. But the real number to really look at January would be with some kind of an assumption on going forward. Now as I said, secondaries did pick up significantly over the December. So the secondary sale of the company is significantly ahead of December or January and for February first few, ahead of January. So there is a pick up there. You will see the registrations picking up with a bit of a lag. We already see the first 9 days of February. If you look at Vahan, our numbers are shot up in terms of registration.
Sure. And one follow-up on the AIS Phase 2 that is coming up from April, what kind of price increase do we anticipate for the industry post that?
I think they're working on that. I think the price discovery is yet being worked upon. And I think the whole level or the equilibrium will shift towards an upper because all the players across the industry will get impacted almost equally. And hence, we will see some shift in the price up. So from a basic margin point of view, I don't think there is going to be much change from March to April. And I think most of the price is in the region that it can be passed on to the consumer largely. So that's what it will be. But the real price discovery, one will be able to actually share during the next quarter call when that's fully discovered.
Sure. Understand that. But suffice to say that it's likely to be higher than the Phase 1?
Yes, it will be. There will be some impact because there are additional requirements that are required in terms of the sensors in the battery, the potting of the battery needs to be done. There could be some engineering changes that may also be required depending on how -- what material are we using. So yes, there is going to be some impact -- but it's not an impact which cannot be -- partly, I think the industry will pass on to the customer and maybe some part can be absorbed, but mostly, I think it can be passed on.
Understood. And just one final clarification. We confirm that we'll be able to comply with the AIS Phase 2 standards, right? Because earlier, I think there were issues that the timing is too short. Would we be able to comply within the given time frame?
Yes. And in fact, we were -- Ampere was the first electric vehicle to actually get a certification for AIS-156 Phase 1, well in November, much before the deadline really happened. And even in Phase 2, we currently -- with the visibility we have, we are working for both component and vehicle level certification. And our visibility suggests that at least the visibility we have is indicating that we will be well on time in terms of the switch over.
The next question is from the line of Gaurav Gupta as an individual investor.
So I think just a follow-up question, one of the participants also asked, I mean, based on the response on that question. Like the other 2-wheeler companies which are listed or the traditional 2-wheeler company, they disclose the numbers that -- what is the kind of numbers they have sold it out in the previous months. We are not putting up that number in the stock exchange filing. That is the first question from my side. And the second, when we see our comparative analysis, vis-a-vis the other players, whether it is a traditional one, like the TVS Motors or the one which are similar to us, like the Ola or Ather. It seems that somewhere in the last couple of months post, I think, October and November, we are not up to that mark in terms of selling our products. So is it something from a technical point of view, product capability point of view because of which our products are not that much hitting the market? Or is it something else that we as investors are missing?
Yes. So Gaurav, 2 things. One, in terms of December secondary sales, like Sanjay already mentioned, October and November were highest ever for this electric mobility. And December due to AIS-156, company had calibrated its production to -- and then the new vehicles, which had to be manufactured and sold. There was a process of entire ARAI certification, FAME II certification, which got completed before the regulated date. And once the homologation was completed, after that the company restarted production, and then the inventory started going back in the market. Sales is happening once the registration gets completed. The data started getting reflected back in the second week. So if you see now the last 2 weeks, again, the momentum has gone back to the levels what it was in October, November. So that's first part in terms of secondary sales number that you are seeing in the Vahaan portal for December month and some part of January month.Now the first point in terms of disclosure, we gave quarterly volume data every quarter on the -- in the investor presentation. On monthly because secondary data is already available from the Vahan part. Our view from our compliance team is to give the audited volume data, which is what we give on a quarterly basis.
Just a follow-up, if you allow me to ask that question. If I see that on an overall basis, including the traditional 2-wheelers as well as the start-ups like us, right, overall, the market is -- it seems to be consolidated among overall 8 players, right from Ola, TVS, Ather, Hero Electric, Ampere, Okinawa, Bajaj and Hero Motors, right? And then for sure, out of these 8, what would be our strategy? We would like to be in top 3, in top 5 or at the bottom of this in the maybe 2 years, 3 years down the line? Because as of now, I think we are somewhere around either in the fifth number or 6th number.
Yes. Let me start. I think if you look at it, right, the registrations and if you look at the year-to-date number, like Sanjay was saying earlier, we have been roughly at about 13-plus percent year-to-date, right, from a market share. So -- and we have been consistent. Barring that, December, January, when the AIS Phase 1 implementation, look at the trend over the last 24 months, and again, there was a dip when we were significantly involved in localization about 12 to 18 months ago and then now with AIS. So right, there are short-term dips. But overall, we have been in double-digit market share, point number 1. Point number 2 is, we believe we were one of the early movers into this. We saw this opportunity ahead of a lot of people or most of the people, right? And I'm clear, product, especially the Magnus is very well established. We got supply chain. We got local manufacturing in place, and we've got a great team in place. So when you look at it, we believe we are looking -- and by the way, in general, from unit economics, we have a profitable venture in general, when if you look at even up to Q2, right? So when you look at all of these data points, I think we are trying to optimize both market share growth and a viable growth. So basically, how do you drive the growth, how do you get up to new customers, we were operating in that sweet spot of that INR 80,000 to INR 1 lakh in the meat of the market. And that's kind of where we believe our strength has been, and we will continue to play to our strategy and to our stance. I hope that answers your question.
Just some specifics. Look, YTD December, if you see last year, we were not #5, as you said. We were #3. We had a 13.2% share, exiting with November at 16.3% as the #2 player. This is just a month before the changeover happened. And then the reasons of this switchover is all that we've shared already with you, which is December and January and how the sale is now going to pick up as we go forward. So one is that just wanted to correct because you said somewhere in the top 8, you'll be #5. We were #2 in November. We're #3 YTD. So that is one small correction I just wanted to make.The second point is we just unveiled the portfolio, and that should be very good because the question was on strategy in 2 years. And in Auto Expo, when we unveiled our products, I think that was a reflection of our strategy in action, where we actually improved the addressable market for our products from 1 and 3 to 3 and 4, almost from a little above 30% to almost 75%. With all the new products, the 3 new products that we introduced, whether it was Primus, where the bookings have already started now. You talked about 2 other products, one, the NXG for discerning millennials, and one for the gig worker, the last mile mobility, which was NXU. So with 4 products moving from one over the next course of the 2 years that you talked about, and with already with one product, as Nagesh said, very successful, Magnus, being #3 in the industry, we stay very strong in terms of our leadership position going forward.
Fine. And very, very encouraging to hear about that as well. So that's why we thought out to get an understanding as an investor that going forward in next 2 to 3 years. So I really appreciate that we were having somewhere around 14%, 15% or near about double-digit market share until October, November, and you are currently on that that we were either #2 or #3. And -- but recently, we slipped to this fourth or fifth number or maybe 6th number because of the competitiveness of the industry, like Ola becoming very, very aggressive, TVS becoming very aggressive. And the same goes with the Ather as well. So that's why going forward, is coming and analyzing this entire pack of 8 players, where do you see yourself in the top 3, in the top 5, or at the bottom in the last 4, maybe. So as a strategy, because like we have a strategy as a company, our competitors would be having the same kind of strategy as well to expand the market share to gain market share and so on and so forth.
So clearly, we are looking for market leadership here. Yes, no strategy is going to be at the bottom of the pack, clearly. The second point, I think, which is a very important point. I hope you picked up which Nagesh made was the profitable leadership, and not just leadership at any cost. So that will be a pivotal philosophy with which we will drive our electric mobility business. We are going to go for profitable leadership. And clearly, we would be amongst the top players when it comes in about 2 to 3 years' time in terms of profitable path towards the leadership there. There are a few other elements, which I did not talk about given the time. But very clearly, there is a brand identity also, which again the opening addressed which Nagesh said, which is a change that you see from the earlier pre-December era to now under the electric, the whole new identity of the campaign, the announcement that we made of launching a 50 brand experience stores over the course of next 12 months, increasing our overall brand stickiness, awareness and then stickiness and preference. All this will actually build up, apart from the new products and addressable market, our position towards our leadership. And then on top of it, if you've been monitoring, and as you said, very closely watching our progress, our dealer strength, our quality, our aftersales service network strength has increased dramatically. The start of the year, it was about 220-odd active dealers. We are now touching close to 400. It's almost doubled. And then this massive advantage that only we have amongst the pack of 8 that you talked about, which is one Greaves, which brings in Greaves Retail, Greaves Finance, Greaves Care, and this extensive ecosystem that only we can talk about amongst the players that you see in the list today. So I think all these things give us confidence that we -- if we can bring all these together, we're on the right path of profitable leadership.
[Operator Instructions] The next question is from the line of Jyoti Singh from Arihant Capital Markets.
Sir, my question is on the acquisition side as we have done -- sorry.
Please use the handset.
Jyoti, please go ahead with your question. You did not complete. So on the acquisition side, you were asking something?
Yes. So like they are doing 28% EBITDA margin. And after we've done the acquisition, so what level we will be on the margin side?
Yes. So if you look at Greaves standalone, we are at 10.7% in Q3. And if you add hypothetically, let say, the current revenue run rate, they are at around INR 40 crores or INR 45 crores a quarter. If I add that revenue and I add the EBITDA margin, the consolidated margin for Q3 would have been 12.8%, 12.9%.
Okay. And sir, going forward, what is the growth rate that we are targeting?
You are asking for Excel Controlinkage?
No. Overall, as a company for Greaves.
So Jyothi, as you know, we don't give formal forward guidance. But having said that, I'm sure you're monitoring the kind of numbers, what's happening in the stand-alone business, and that's quite predictable with the overall things in the 3-wheeler improving. The price parity between CNG and diesel going more in favor of diesel, the volumes are expected to increase on the 3-wheeler auto side. In non-auto side, with the profitability focus and profitability improving now, we are expecting better growth than what we have seen in the past. And raw material prices going down augers well for overall profitability of the company. The Excel Controlinkage, will add another INR 200 crores, INR 250 crores on top of the existing top line of the company.
Okay. And sir, how is the inquiry level we are seeing for the new launches that we have done in the Auto Expo?
Sanjay, on Primus, actually, we have started the booking there?
Yes. It's early days of booking there, so we've got excellent response in fact across the country. We have over thousands, I think, numbers already registered since we just started a few days back. And the number of leads I'm not talking, I'm talking about paid bookings there, which have already started happening. So yes, that product, we will see rollout as we committed in this quarter itself. And that -- the early response and the bookings that we have to go by has got very encouraging initial feedback, yes.
Next question is from the line of Ashutosh Tiwari from Equirus Securities.
So we have mentioned that we'll be launching this mechanical BSVI engine for 3-wheelers. So how would the cost come down with that compared to the current engine that we have?
Yes. So the G 435, our older version, which is now launched with BS VI compliant norms, and that has been launched in the market. The price difference is almost 15% between the electric version and the mechanical version. And in terms of margins, it's almost 300 basis points higher or something.
Okay. So are customers accepting it, like, say, volume for this product will increase going ahead?
Yes, Ashutosh. The initial response has been good. So G 435, the clients who have taken, out of the 4 or 5 major OEMs we have, a couple of OEMs started with G 435, and they have seen market share growth on a relative basis overall. And initial response of G 435 has been good in the market. So talk about the PVPL, talk about Atul, et cetera, their market share has grown with G 435.
Okay. And secondly, on non-auto engine side, the volumes have been tapered over the last few quarters. How do you see this segment doing going there?
Yes, Arup, if you can just highlight in terms of profitability focus that we have there in non-auto?
So in non-auto, we are really focusing on getting a better quality of EBITDA. And there are also impending regulatory changes. So this is a bit of a gray field, and time will tell how the demand pans out because there's a fair amount of clarity that users are wanting to understand for certain applications in terms of the regulations that are there. The other dimension that is also going to affect the non-auto side is the fuel choices in terms of the blend portfolio fuels that are going to be in demand going forward. Our focus will remain on profitable growth, and we should see that improve.
But which industry applications we are targeting where the public growth can come there? I mean I wondered if anything on that side.
Ashutosh, mainly there are 4 segments in the non-auto. One is the power solutions where we have gensets and also the industrial engines, which we are giving to some of the large customers. And that's a segment we are focused, in the recent past has been on improving the margin. Still volumes continue to be in a growth phase. The growth could have been higher, but we are intentionally ensuring that margins improve in this particular segment. The second segment, which is the non-auto small engines and the farm equipment. And in farm equipment, as we had mentioned earlier, because of China import dependency, which has now got replaced with the tie-up with the Indian manufacturers, in Q3, you would have seen the volumes have started moving up compared to Q2. And that's one area where we are going to see the growth coming back. So farm equipment used to be healthy volume close to around 10,000 to 15,000 a quarter minimum. So that's one area where we see significant growth coming back with the Indian tie-ups and the subsidy part being -- sorry, the government registration part being taken care of.
And lastly, on the subsidy part, which is due from government. So we are now cleared in terms of all the regulatory things which are pending, like say we got all the approvals in place, right? It's only that amount will come any time or there's something remaining over there in terms of clearances?
Ashutosh, in terms of development, as we went into the new products, right, the Magnus and with the AIS-156 Phase 1, the new Primus, which is also under certification. So we have got all the required certificates, including the FAME II permission and the compliance certificate from the government. So you would have seen our vehicles are allowed to claim subsidy and pass it on to the customer. So that part is clear from the government side. And as late as in the December, when we went with the AIS-156 complaint vehicle homologation, that again certification came from the government.All the questions, details that they had asked, all of them have been submitted. They had appointed agencies, all the details have gone to them, including of the past. Now it's a question about they taking the final decision and which is common for majority of the industry players and the various parameters what they are examining and then start releasing the money.
So next 2, 3 months that some amount should come to us?
Yes, we all are closely hoping and monitoring that because that's a significant thing for the entire industry over there. So players like us who have been large enough in the size, we are able to sail through this time, but there are many small players who are dying and there is enough of responsibility on the government also to clear this particular part as soon as possible.
Thank you. Ladies and gentlemen, that would be our last question for today. I now hand the conference over to Mr. Nagesh Basavanhalli, for closing comments. Thank you, and over to you.
Thank you all for attending, and thank you for the insightful questions. As always, management team is available. If you have any questions, you can reach out over the next several days. Thank you again for your time and attention. Have a great day.
Thank you very much. Ladies and gentlemen, on behalf of Greaves Cotton Limited, we thank you once again. Stay safe. This will conclude today's call. Thank you all for joining us, and you may now disconnect your lines.