UNO Minda Ltd

NSE:UNOMINDA

Earnings Call Transcript 2024-Q4

[Operator]

Ladies and gentlemen, good day, and welcome to the Uno Minda Limited Q4 and FY '24 Earnings Conference Call. This conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions and expectations of the company as on date of this call. These statements are not the guarantees of future performance and involve risks and uncertainties that are difficult to predict. [Operator Instructions] Please note that this conference is being recorded.

I now hand the conference over to Mr. Sunil Bohra, Group Chief Financial Officer from Uno Minda Limited. Thank you, and over to you, sir.

[Sunil Bohra, executive]

Thanks, Deepu. Good afternoon, everyone, and a warm welcome to all the participants. On the earnings call today, I'm joined by my colleague Ankur Modi. We have uploaded our financial results and investor presentation for Q4 on the stock exchanges and our company's website.

I would like to begin by giving some insights on the economy, followed by the current scenario in the industry and our financial and operational performance for the quarter and FY '24. Post that, we will open the floor for Q&A. The global economy is displaying signs of recovery with inflation moderating and being projected to grow at a rate of 3.1%. However, amidst the prevailing global uncertainties India's economic continues to exhibit remarkable resilience.

In the third quarter of FY '24, India achieved a growth rate of approximately 8.4%, surpassing expectations. This growth is driven by factors such as continued demand momentum across various industries and segments, increased government capital spending, rural demand also rebounding.

India's manufacturing activity reached a 16-year high in March with PMI index of 59.1. This surge has created more jobs with unemployment data showing sharp reduction overall reflecting stronger growth in new orders. All these factors pointed to a sustained growth. India's GDP growth for FY '24 is expected to be 7.6%, surpassing estimates by most global agencies. Speaking on the auto industry, the industry witnessed a robust production volumes growing 10% year-on-year for FY '24 and 21% year-on-year in Q4 FY '24 with strong domestic demand and increasing share of exports worldwide, India has positioned itself as a global automotive hub with a promising future.

In the passenger vehicle market, SUV share continued to grow, now holding a substantial 50% market share. During Q4 FY '24 production volume increased by 10% year-on-year, reaching 13.4 lakh units. For FY '24, the PV segment witnessed a growth of 7%, inching towards 5 million units. Notably, both retail sales and production of passenger vehicles achieved an all-time high in FY '24. On the back of improved vehicle availability, a compelling model mix and successful launch of new models. Additionally, sustained demand growth in our underpenetrated India market, strategic marketing efforts by OEMs or the government investment in road infrastructure contributed to the overall sales and production growth.

Moving on to two-wheeler segment. In Q4 FY '24, the production volume stood at 55.24 lakh units, delivering a strong growth of 26% on a year-on-year basis. For the year ended March 2024, the segment achieved highest production in the last 4 years with 21.4 million units, recording a 10% Y-o-Y growth fueled by improved rural demand enhanced model availability. The introduction of new products and a positive market sentiment alongside the burgeoning EV market and strategic premium segment launches.

On the saving front, for the quarter ended March '24, the production volume stood at INR 2.88 lakhs as compared to INR 2.9 lakhs in the same quarter last year. The segment is witnessing stable volumes. However, our outlook remains optimistic. With expected upswing in industrial and manufacturing activities, the segment is poised for growth. For FY '24, the production volume stood at INR 10.66 lakhs, a growth of 3% on a Y-o-Y basis. The growth is attributed to the segment's adeptness in leveraging government tenders, improved growth connectivity and strategic bulk needs. Talking about electrification in March '24, India achieved a remarkable milestone with elected two-wheeler sales surpassing 136,000 units, marking an impressive 50% Y-o-Y growth.

Throughout the entire financial year, sales sold to nearly 9.4 lakh units reflecting a substantial 30% year-on-year increase. This was partially driven by our customers' repurchasing vehicles ahead of the expiration of the PMT subsidy complemented by year-end discounts. On conclusion of FAME II, the government has announced a fund limited scheme with a total outlay of INR 500 crores for the period of 4 months with effect from 1st April '24 till 31st of July '24 for faster adoption of electric 2-wheelers and 3-wheelers to provide further impetus to the green mobility and development of electric vehicle manufacturing ecosystem in the country. The road to electrification is inevitable and India is poised for substantial growth with strong emphasis on sustainability and thrust on local production.

Industry outlook heading into FY '25 the Indian auto industry is poised for growth amidst a mix of optimism and challenges. The excitement around new product launches, particularly electric vehicle sets are forward-looking tone. Manufacturers are gearing up with better supply chains and an array of models to meet the diverse consumer demand. Economic growth, favorable government policies and an anticipated good monsoon are expected to fuel demand especially in the rural areas and the CV sector, which is closely linked to infrastructure projects and economic activity. Market sentiment is cautiously optimistic with the industry banking on improved customer engagement and financing schemes to boost sales.

However, it faces challenges like high base in PV segment and intense competition. The focus is on overcoming these hurdles with innovation and strategic market engagement aiming for a balanced growth across all segments.

Coming to financial and operational performance, you may refer to Slide #5. We have recently secured allotment of strategic land parcel of around 94 acres from HSIIDC at IMT, Kharkhoda in Haryana. This will help expedite our ongoing and future expansions. A part of this land has been designated for the greenfield alloy wheel plant of 120,000 units per month announced in Q2 FY '24. Post the groundbreaking ceremony, the work has started at the site.

As you know, we have been proactively securing land parcels in all major auto hubs to be ready to meet growing demand. Last year, Uno Minda had acquired 86 acres of land at Khed City Industrial Park, Pune, followed by recent acquisition of 37 acres in Hosur, Tamilnadu and now 94 acres in IMT, Kharkhoda, Haryana. While we continue to evaluate more land at other locations, the proactive land acquisition and greenfield projects demonstrate our commitment to staying ahead of the curve in the rapidly evolving Indian auto landscape.

During the quarter, we entered into technical license agreement with StarCharge Energy PTE Limited, to manufacture and sale of electric vehicle supply equipments in India, further building on the e-4-wheel specific portfolio. We will discuss this in detail in subsequent slides. We have completed purchase of 26% stake in Minda Westport Technologies Limited in April '24, increasing stake to 76%. Minda Westport has now become a subsidiary and will be consolidated in financials from Q1 FY '25.

The compressed natural gas-powered vehicles in India have increased by 32% in FY '24, in line with increasing CNG penetration. Minda Westport revenues have also grown by 156% to INR 277 crores in FY '24 with better availability of supplies new CNG model launches for PV as well as CV strengthening of CNG infrastructure and the CNG penetration. It is further expected to increase levels of about 18% for CY '27 from current levels of 15% penetration. This presents an exciting opportunity for Minda Westport going forward.

Turning to financial and operational performance. You can refer to Slide #7 and 9. At a consolidated level, revenues from operations for the quarter ending March '24 increased by 31% year-on-year to INR 3,000 crores roughly INR 800 crores from INR 2,900 crores in Q4 FY '23. The growth was evident across all product lines, with particularly strong performance from EV products, lighting, switch, sensor, controller and alloy wheel business. Some of the businesses, which played a significant role in substantial growth are primarily formed: One, capacity expansion and ramp-up in four-wheel alloy wheel, two-wheel alloy wheel, four-wheel lighting plant and four-wheel sensor plant. Second, increase in revenues from EV specific products under Uno Minda Q1 controller. Third, market share gains in 4-wheel lighting business. Fourth, increase in kit value with higher sales of SUVs and passenger vehicles and premium model in 2-wheeler. And last, increase in exports for seating and two-wheeler seats.

As you would have noted, EBITDA for the quarter was a record at INR 474 crores reflecting a 48% year-over-year improvement from INR 319 crores. Besides benefit of operating leverage as normally expected. The current quarter also benefited from yearly price increase settlements. Finance costs have increased to INR 22 crores in comparison to corresponding quarter last year on account of incremental borrowing for CapEx and working capital. The depreciation has increased in line capitalization of new projects. The share of corporate loss of associated JV's for the quarter jumped to INR 58 crores as against INR 24 crores in Q4 FY '23 as Denso, Roki, Westport, TRMN and PV all the businesses witnessed significant growth along with the turnaround in Minda Onkyo.

As you would see, there is an exceptional income consequent to the decision of under the Supreme Court that interest on CVD portion towards EPCG liability is not able. The related provision has been reversed. And this being a onetime item has been shown as an accessible income. The profit after tax, which is Uno Minda's share for the quarter was at INR 290 crores as against INR 183 crores. However, excluding the exceptional item from the profit, the quarter would have been INR 269 crores as against INR 290 crores, which is a growth of 40% year-on-year, 47%, sorry.

Moving to financials for FY '24. We have achieved consolidated revenues of over INR 14,000 crores for the year ending March '24, registering a growth of 25% on a year-on-year basis. You would like to highlight that industry volume growth for FY '24 was 10% and against which we have grown by 2.5x, significantly higher than our long-term guidance of 1.5x. The EBITDA for the period grew by 28% at INR 1,585 crores registering EBITDA margin of 11.3%. The profit after tax, which is Uno Minda's share for the period, excluding exceptional items was at INR 861 crores as against INR 654 crores in corresponding period last year, reporting a growth of 22%.

Turning to the business segment-wise performance, starting with switches. If you can refer to Slide #12. Our Switching Systems segment performed exceptionally well, generating INR 963 crores in revenue for the quarter, representing a significant 25% of our consolidated revenues. The segment grew 14% for FY '24, generating revenues of INR 3,633 crores as against INR 3,203 crores in FY '23. This growth can be attributed to smarter switches with increased number of switches per vehicle. Additionally, exports in the two-wheeler segment emerged as a major growth driver, signifying our global competitiveness.

Moving to Lighting business. It continues to be a key growth driver for Uno Minda generating impressive revenues of INR 972 crores during the quarter, representing a significant 26% contribution to our consolidated revenues. For full year, lighting business achieved revenues of INR 3,368 crores growing by 31% on a year-on-year basis.

As communicated in the past, we had some significant strategic order wins over the past few years. These businesses are gradually commencing production, which is significantly propelling the growth trajectory of lighting business particularly in the 4-wheel segment. Our lighting business has delivered significant growth in recent past, with 4-wheel lighting business almost doubling in less than 2 years. This success is driven by our market-leading innovative lighting solutions to their empowering OEMs to differentiate their offerings in the marketplace.

We are currently supplying 3 long tail lens and one signature LED front DRL for EV model of the largest PV/EV manufacturer in India. This unique signature DRL comes with welcome and goodbye sequenced and charging indicators. Boyd by success in Indian market, some of these models are also being launched in global markets with manufacturing in these global geographies. We are confident that this positive momentum to continue, fueled by sustained SOP and continuos expansion of our market share.

Moving to Casting business. It delivered a robust revenues of INR 770 crores in Q4, accounting for a substantial 20% of our consolidated revenues. Out of INR 770 crores, four-wheel alloy wheel contributed INR 436 crores, two-wheel INR 204 crores and casting business INR 130 crores. The casting business revenues for full year grew by 30% to INR 2,830 crores. Both two-wheeler and four alloy wheel has been witnessing good growth supporting by capacity expansion. Four-wheel alloy wheel facility stands at 390,000 wheels per month, which is running at almost 100% utilization. The 60,000 expansion is delayed with 30,000 expected to commission in the second half of FY '25 and the work on remaining capacity will commence depending on the necessary approval for land acquisition. We started construction for 120,000 wheel per month greenfield plant at upcoming Auto Hub IMT, Kharkhoda, which will be commissioned in 2 phases of 60,000 each.

The first phase is expected to be commissioned by Q2 FY '26. Within alloy wheel, we are seeing preference for different varieties. During the quarter, we had received a large order for diamond finish alloy wheel from a Japanese OEM for the forklift and a new EV model. Allowable penetration in PV has reached around 45% from 15% when we entered the market. Along with the growth in market, we have cemented our position as the largest manufacturer of four-wheel alloy wheel in the country. At our two-wheel alloy wheel business, the additional capacity of 2 million was completed in the last quarter and is having stable operations. This expansion brings the total installed capacity for two-wheel alloy wheels to impressive 5.4 million to 6 million wheels per year, depending on the weight of the wheel. With this additional capacity coming in, we have broken into the top 3 2-wheel alloy wheel manufacturer in terms of capacity and market share.

Additionally, as you would have noted, Board has also approved expansion of the plant by another 2 million wheel per annum with an investment of INR 300 crores. Over the last few quarters, we have significantly diversified our customer base with around 3 to 5 key customers with business in both scooter and motorcycle segment. During the quarter, we received order for American 2-wheel OEM model manufactured in India.

Moving to Seating business, a key contributor another for our overall performance generated around INR 264 crores in revenue, representing 7% of our consol revenue. For full year seating business revenue stands at INR 1,100 crores. Besides our existing incumbent two-wheeler OEMs, we have started supplies for 2 new 8 EV OEMs, these supplies for new incumbent two-wheeler OEM will start in the next 6 months. We are happy to inform that we have secured an order for a mechanical suspended seat and pneumatic suspended seat to be supplied to a domestic CV volume. SOP of the said order is expected in Q3 FY '25. Until now, we have been supplying suspended seats only to the export market. Exports continues to play a crucial role in driving the growth for seating business. We once again achieved export of around INR 200 crores from our seating business alone. Looking ahead, we anticipate seating business to maintain a healthy growth momentum fueled by new order confirmations and upcoming execution of new orders along with suspended seat order for the Indian market.

Moving to Acoustic segment, generated revenues of INR 213 crores in Q4, representing a stable 6% contribution. Acoustic business also grew by 13% on a full year basis to INR 433 crores. While the Indian business continues to demonstrate industry-led growth, the European subsidy Clarton Horn continues to experience ups and downs. Clarton Horn did close the year with a positive note with a positive EBITDA impact for the quarter as well as for the year.

Moving to other products and businesses, which are achieved revenues of INR 613 crores for the quarter, contributing 16% of overall top line. Out of INR 613 crores, INR 130 crores was contributed by controllers, INR 107 crores by sensors, INR 110 crores by blow molding, INR 68 crores ADAS, INR 55 crores in the new EV. Besides above, the sales into aftermarket trading, external sales from Uno Minda catalog and engineering sales in Europe and batteries for auto market. Revenues for other business segment has grown by 50% to INR 2,226 crores as we continue to expand in emerging technologies. Over the years, we have built a very robust portfolio of sensors comprising of Indian and adjust sensors, active, safety and comfort sensors, transmission and suspension sensors, CNG EV sensors, wheel speed sensors and the latest addition is tyre pressure monitoring systems.

Revenues from sensors have grown significantly from INR 60 crores in FY '21 to about INR 400 crores now. We have combined ADAS division with sensors from operation perspective because of this ADAS sensor, secured revenues of INR 600 crores. Our controller business continues to impress with achieving INR 375 crores sales for FY '24. Uno Minda EV systems also clocked in INR 196 crores revenue in first full year of operation itself.

Moving to aftermarket and international revenues, Slide #14 and 15, you can refer to. In terms of our revenue pie for the quarter ended March '24, OEM business accounted for 93% and aftermarket at around 7%. Our aftermarket division revenue stood at INR 256 crores for the quarter. Our international sales company represent approximately 14% of total revenue, demonstrating steady growth in this segment while the international market holds strategic importance for our future expansion, it is worth noting that our domestic business has been experiencing more pronounced growth.

Moving to our debt levels, our net debt as of March 31 was at INR 1,318 crores compared to INR 1,078 crores as of March '23. The net debt has increased on account of expansion CapEx as well as expenditures for land bank primarily at Pune and Hosur for around INR 220 crores. While sustaining and growth CapEx has been financed from business cash flow expenditure primarily on land bank has resulted in incremental debt. Our net debt to equity stands at healthy 0.25. We have achieved ROCE of 19.8% basis analyzing profits of -- annual profits FY '24. Kindly note that capital employed considered for calculation does include the CapEx for land bank as well as CV, which is currently not generating terms. If one were to exclude only the strategic land bank, the ROCE would have been around 20.3%.

In terms of return on equity for FY '24, it stood at around 19.4%. The Board has also recommended a final dividend of INR 1.35 per share, which is 67.5% of face value. Total dividend along with interim dividend already paid will become INR 2 per share, which is 100% of the face value. We have been consistently increasing our dividend payout ratio from 10% in FY '19 to 13.4% now. In the last 5 years, our dividend payment amount also has increased fourfold from around INR 28 crores in FY '19 to the estimated payment of around INR 150 crores for FY '24. That now underscores our commitment to returning value to shareholders on a consistent basis.

Moving to EV. You can refer to Slide #15 and 16. Revenue from EV two-wheeler OEM increased INR 280 crores in Q4 as against INR 167 crores in last quarter. We witnessed growth in EV specific as well as traditional products as to two-wheeler EV OEMs. The revenues from EV two-wheeler OEM we expected to continue to increase the consortium of various orders. We have built a strong order book for EV-specific product as well as existing products from EV OEMs. We have received further orders from our existing products from OEMs across vehicle categories. The SOP of these orders will start in gradual manner in FY '25, which will further boost revenues from the EV sector.

Building up our EV specific work portfolio for four-wheeler, we entered into a TLA with StarCharge to manufacture and sale of EVSE in India. The EVSE comprises of wall mounted AC chargers designed for convenient home charging. These chargers are easily sold along with PV to customers by OEMs to provide ease of charging at home. StarCharge is a global leader in electric vehicles charging infrastructure and micro grid solutions operating in 67 countries and regions with manufacturing facilities in USA, Vietnam and China.

With millions of EV charging stations installed worldwide. StarCharge is at the forefront of providing continuos charging solutions for diverse applications. StarCharge has been a strategic partner of 60-plus well known OEMs and multiple renowned energy companies globally. The potential kit value of these EVSE ranges from roughly INR 14,000 to INR 17,000 with estimated uplift of 40%. We have multiple RFPs in hand for EVSE with high probability of winning some of them.

According to the IEA, most EV charging demand globally has been met at home or at work and not by publicly accessible channels. Uno Minda in partnership with StarCharge aimed to revolutionize such home charging solution, paving the way for faster, cleaner mobility adoption in India. In terms of capital expenditure, refer to Slide #24. As informed earlier, we have started construction at IMT, Kharkhoda for our greenfield alloy wheel plant for 4-wheelers. Though there was a delay in starting construction due to land acquisition, we will fast up the CapEx implementation given the land acquisition is completed and machinery orders in progress. The Phase 1 of lighting plant has expected submission in the second half of FY '25 with construction going on in full speed. Regarding four-wheeler switch plant in Farrukhnagar, Gurugram Phase 1 comprising of subdepartment factoring is completed.

Given the -- among those opportunities coming our way, we will continue our capital in FY '25 as well. The capital expenditure already announced projects like four-wheel alloy wheel at Kharkhoda and Dhawal, four-wheel lighting in Pune, Uno Minda at Farrukhnagar, Uno Minda eSystems even taking FY '25 as per plan. We are likely to further expand Indonesia and aluminum die casting four-wheel with CapEx announcements in FY '25. As mentioned earlier, pursuant to additional orders, the Board has also approved a CapEx of INR 300 crores for expansion of two-wheel alloy wheel plant at Supa to add CapEx by another 2 million per year. This will take the total capacity to roughly 7.5 billion to 8 billion units per annum. For FY '25, the sustaining CapEx is expected to be around INR 450 crores to INR 500 crores and project CapEx of around INR 850 crores to INR 900 crores, including the expansion of two-wheel alloy wheel project approved today. In addition to above, we would continue building strategic land bank in locations like Gujarat, Hosur and other related regions.

Moving to strategic business update. The Board has approved increasing stake in TGMinda from 47.93% to 49.9% by buying 1.9% stake in Kosei entity at a constitution of INR 17 crores. The remaining 50.1% stake in TGMinda is held by JV partner TG. With respect to merger of Kosei entities with Uno Minda, we have not received NOC from some of these business and approved from lenders, creditors and shareholders. We've also moved the second motion application NCLT. The next date of hearing is in the first week of August. And we expect that post the hearing, it will take another 2 to 3 months for merger process to be completed.

Moving forward, the outlook continues to be promising with supporting industry volume guidance commissioning and ramp-up of multiple new expansions, namely TV plants and two-wheel -- four-wheel alloy wheel expansion, lighting plant, Gujarat and Pune, et cetera. While we have been guiding on long-term growth prospect to 1.5x of industry growth, we expect it could be higher in the near term. As you know, while quarter-on-quarter, there is variance in margins due to inherent business modalities and challenges we would like to maintain our annual EBITDA margin guidance of 11% plus/minus 50 basis points with the bias towards higher end. With our existing diversified product portfolio, new product technologies, we are confident of sustained outperformance over long term.

With this, I would like to now open up the floor for questions.

[Operator]

[Operator Instructions] The first question is from the line of Mumuksh Mandlesha from Anand Rathi Institutional Equities.

[Mumuksh Mandlesha, analyst]

Congratulations on strong margin performance and entry to four-wheeler EV segment, sir. Just on the gross margin side this quarter, can you quantify the impact of price hikes?

[Sunil Bohra, executive]

Sorry, come again, Mumuksh.

[Mumuksh Mandlesha, analyst]

Can you quantify the impact of price hike during this quarter, sir?

[Sunil Bohra, executive]

There is no price hike, Mumuksh, that's what I think we said in the last call also. There are normally whatever are the customer price settlements, they normally tend to get settled in the last quarter of the year or third quarter of the year. So you do see a little more benefit in the last quarter. If I have to quantify that impact, that is roughly around INR 30-odd crores during the quarter.

[Mumuksh Mandlesha, analyst]

Got it. Sir, now on this four-wheeler EV StarCharge now partnership. So I just want to understand how we see the revenue trend for the StarCharge and also now with the four-wheeler EV focus area, so over a medium term, any guidance you want to share how you plan to ramp up like in 2-wheeler you have mentioned earlier?

[Sunil Bohra, executive]

Yes. So I think Mumuksh, by end of next quarter, I think we will have much, much, much better clarity because we have just signed the TLA and the team is in process of preparing the detailed project report, post that, we will have some visibility but still that our dependence is there on OEMs and we normally don't comment on the numbers in terms of expected revenues. But in terms of the entire product profile because StarCharge is only one part of it, we already have a lot of other products which currently are in the works, and some of them are also in operations. So maybe we'll give you a full picture where we have our results call after Q1.

[Mumuksh Mandlesha, analyst]

Got it. Sir, Lighting segment is seeing a strong growth. So just wanted to get a sense, how is the profitability in that segment? Earlier it used to be like a high single digit sometime back. So how that has changed, sir? Is this a lighting as a more profitable segment among the other segments, sir?

[Sunil Bohra, executive]

I wish it was. But I think we have discussed this in the past also. First of all, just to put some background, we know that kit value for the lighting products as it moved from halogen to LED, has increased significantly and with a lot of bought out component in terms of electronics. And I think that has been the key reason why we said that the margin in the 4-wheel lighting business is specifically which is seeing that kind of growth is below average margins, so which continues to be there.

[Mumuksh Mandlesha, analyst]

Got it. And lastly, on lighting part, obviously, a very good pickup on the new orders. Can you just guide how do you see the next year in terms of growth for this business?

[Sunil Bohra, executive]

These businesses -- I think we have been saying very candidly that we are very, very bullish on this business with multiple, I would say, tailwinds and also in terms of getting more business, really in terms of transition from halogen to LED, increase in kit value going multifold and also share of business gains. So we are very, very optimistic specifically in forward lighting business, we are currently in the process of commissioning -- not -- constructing, not commission, constructing our share plans, I think four-wheel, that is up and running.

There is U.S., the boost. In fact, even at the plant in Gujarat, which we have put up, it's almost running out of the capacity. The plant was commissioning only what, over 1.5 years back or 2 years. So this business will continue to grow. And our goal has been to reach 20% share of business at the first milestone, and I think we are on track to achieve that.

[Mumuksh Mandlesha, analyst]

Got it. Any guidance or good guidance for FY '25? What kind of growth we can see for lighting, sir?

[Sunil Bohra, executive]

I think Mumuksh the same thing. We said we don't comment basically your numbers. So my apologies for that.

[Operator]

The next question is from the line of Siddhartha Bera from Nomura.

[Siddhartha Bera, analyst]

Congrats on a great set of numbers. Sir, on this lighting and besides, first, to continue the last question. I mean if you look at the current quarter and just annualize it, so it implies the flows to 60%, 70% growth for the next year and we also have this new plant, which is coming up in the second half, which you mentioned. So I mean, can you throw some more light on to which are the orders which are ramping up here? And does this mean that, I mean, this segment can grow at more than 30% probably in the coming few years?

[Sunil Bohra, executive]

So absolutely, Siddhartha first of all, thanks for the compliment. In terms of growth, whether it be 30% or 20%, you know that a lot also depends on the industry volumes. So it's very, very difficult to say whether it will be 20% or whether it will be 30%. But definitely, it will outperform industry growth by margin. If you see last year itself, the four-wheel lighting business have done annual revenues of roughly around INR 1,200 crores odd. And the last quarter itself, we have done something like INR 380 crores, INR 390 crores close to INR 400 crores. So with that itself, I think we are poised for that kind of number, what you said, but a lot also depends on the -- in industry volumes. So while we are optimistic, maybe we are able to achieve that, but very difficult to comment whether it will be 30% or will be 20%.

[Siddhartha Bera, analyst]

Okay. Sir, can you comment the breakout between 4-wheeler and 2-wheeler and where are you seeing the most traction?

[Sunil Bohra, executive]

Obviously, 4-wheeler lighting is the more traction Siddhartha. 2-wheeler lighting, we already are 25% plus kind of markets domestically. And we already have much higher penetration in 2-wheeler in LED. So there's not much of scope in terms of value enhancements. So it is the 4-wheeler lighting business, which you will see outperforming by a huge margin.

[Siddhartha Bera, analyst]

And sir, how much was it in last quarter 4-wheeler?

[Sunil Bohra, executive]

4-wheeler lighting, last quarter, I said, I think INR 380 crores, INR 390 crores was 4-wheeler lighting business in India.

[Siddhartha Bera, analyst]

Okay. Okay. So sequentially, in the last quarter, Q3 also, you had mentioned about INR 340 crores from 4-wheelers. So has the delta come more from the 2-wheelers?

[Sunil Bohra, executive]

No, no. So INR 340 crores to INR 390 crores I'm saying is only 4-wheelers.

[Siddhartha Bera, analyst]

Yes. But our revenues have grown from INR 850 crores to INR 970 crores. So nearly INR 120 crores.

[Sunil Bohra, executive]

Yes. So that also includes, Siddhartha, the overseas lighting business in ASEAN and also in Europe. So that is overall group lighting business. What we are referring to is the Indian -- INR 340 crores is Indian lighting business.

[Siddhartha Bera, analyst]

Okay. Got it. Got it. Sir, second question is on the seating side, we have seen good improvement in industry volumes in 2-wheelers and CVs, but our seating revenue seems to have been quite flattish sequentially. So some thoughts here, I mean, you have said that you have won a couple of orders if you can quantify what is the size of these orders and how to think about the growth here?

[Sunil Bohra, executive]

So the new order which we have got is from the Indian CV customer is roughly around INR 80 crores to INR 100 crores a year, depending on the volumes, plus the quarter-on-quarter number, I appreciate, yes, it is flattish, but that's what I think we have seen in terms of the CV volumes also, which have been actually negative in the last quarter. So the seating business revenue is almost half comes from the CVOR segment. Plus there has been some headwinds in terms of the exports, while we have a global supplier to JD and there are a lot of exports. That has not been seeing significant volume uptake in fact it has been more static to negative in terms of volume. So while we have got business in hand, I think it's the volumes which are not in our hands. I was trying to justify, but that is the key reason why the revenues are flattish.

[Siddhartha Bera, analyst]

Okay. Okay. Sir, lastly, I mean, the 2-wheeler CapEx, which is say about INR 300 crores. I think the last CapEx of similar size was about INR 190 crores. So why the CapEx intensity seems should to be slightly higher here? And lastly, on these aftermarket revenues, we have not seen much improvement over the last 1 year, revenues seem to be around that INR 270 crores, INR 280 crores type of run rate. So any thoughts what will drive this? Or what are we thinking here?

[Sunil Bohra, executive]

No, no, you're right. I think both the questions are very, very genuine, Siddhartha. So first of all, the 2-wheeler lighting project, which was announced at INR 190 crores, it was actually ended INR 225 crores. By the time it got completed, there were significant cost overruns. And for that INR 225 crores, the land was already part of the first acquisition. So there was no land cost in the second phase. Now when we are buying setting up this new expansion, we have to buy this 13 acres of land from MIDC. Plus over last 3 years, there has been a significant increase in the cost of construction and also the machinery, et cetera.

So while we tried and tried to optimize a lot of things, plus also what is happening is in this expansion there is powder coating extra, which was not there in the first phase. So if you see there is one specific customer, so who uses this wheel -- 2-wheeler wheel for scooter with different technology of coating, which the cost is higher than the traditional covering while it does get compensated to better pricing, but the overall cost increases. So that is in terms of CapEx.

And in terms of aftermarket, yes, you are right. The aftermarket revenue despite a significant push in terms of increasing, the sales have not seen significant traction over the last 1 year. But if you see the industry barring 1 or 2 players, I think the numbers have been like that we could have not grown significantly so while there was a significant growth year before, this year, which is FY '24 has been flattish, but we are expecting FY '25 to be much better than what we have done in FY '24.

[Operator]

[Operator Instructions] The next question is from the line of Raghunandhan N. L. from Nuvama Research.

[Raghunandhan N. L., analyst]

Congratulations on strong set of numbers.

[Operator]

Sorry to interrupt you, sir. May I request you to use your handset, sir, your audio is slightly muffled.

[Raghunandhan N. L., analyst]

Congratulations, sir. Firstly, within the other segment, the sensor, controller and ADAS part have done very well this year. How do you see the outlook for FY '25? And secondly, in terms of the EV order book, congratulations on the increase from INR 3,300 crores to INR 3,700 crores. If you can give some more color with addition for orders of traction motors, motor controller, how do you see the ramp up for this particular opportunity? And if you can indicate how many customers you have got on the motor side. Just some color on how you see the growth ahead.

[Sunil Bohra, executive]

Thanks, Raghu. In terms of the other segment, as you know, these are businesses which are primarily the sunrise businesses, which is maybe sensors and controllers. The application is going very, very high or the EV products are also part of this segment. So we are very optimistic in terms of the growth of some of these businesses. And as we move forward, normally, our barometer is once a business process, 10% of total revenues, we start showing the separate layer of segment. So I'm pretty sure in next few years, we should be having one of the businesses who will actually cut into that category.

And in terms of the EV order book, the large part of the orders which we have secured in the last quarter is primarily from the existing businesses, which are the EV agnostic businesses, while they are from all the EV players, but nothing significant from the specific product perspective. And in terms of the motor business while we have got a couple of new customers onboarded, the SOP of those -- the onboarding what happened in line is which we got in the last quarter primarily. The SOP will happen sometime in the second half of FY '25, I think one customer is -- in Q2 itself and the rest, I think are in the second half FY '25.

In terms of motors and -- in terms of motor controllers and others, there's going to be a significant ramp-up in the current year. As I have discussed, the -- some of these products have gone into production in the last year, and some of them will get in production in this year. And as I said, in the first year itself, this JV has clocked revenues of close to INR 200 crores. And we are pretty optimistic that it will be a significant growth in the coming years.

[Raghunandhan N. L., analyst]

And a couple of quick clarifications. One is the INR 30 crores price settlement, which was received in Q4 instead of looking at Q4 gross margin, it would be better to look at full year FY '24 margin to get a normalized level. Would that be a right understanding?

[Sunil Bohra, executive]

Absolutely, Raghu. I think you have said what I wanted to say. In fact, this is what I always say, and I think I said in my commentary as well that we are in a business where quarter-to-quarter, you might see there is a variation in terms of margins because we are not a B2C company. So there are times when the settlement takes time. There are times when prices go north, there are times when prices go south in terms of the commodity pricing. So there are various factors, but everything gets evened out on a full year basis. So that's why it's very important to see the full year profitability. And that's where we have grown by almost 25 basis points on a full year. So I would say that is more realistic, and I appreciate you asking that question.

[Raghunandhan N. L., analyst]

And in terms of -- because you are adding capacity to meet the strong demand, there will be some upfront cost but like over a period of 2, 3 years, how do you see the trigger for the margin?

[Sunil Bohra, executive]

No, we are very, very optimistic, Raghu, and I said, and I think I said in the commentary also, while our margin guidance has been 11% plus/minus 50%, I said for FY '24, '25, we would tilt it towards the upper end of that range. And as we move forward and as we rightly mentioned, a lot of these projects once they come on to stream, normally, we see the third year of production as a stable -- third full year production as a stable operation, and that's where we expect that business to deliver its expected volumes and profitability. So as we move forward and as these CapExs all come online, gradually, ideally, we should see some uptick in margins benefited from the operating units and also scales, higher sales.

[Raghunandhan N. L., analyst]

Just on the margin side, a last question. In terms of the revenues are going up for EV specific parts so any benefit we can expect either in '25 or '26 from the PLI incentive?

[Sunil Bohra, executive]

So as we speak, a lot of our products are actually -- while they are eligible in PLI, we are at a threshold of that 50% DVA plus/minus 3, 4 percentage points. So we are working on to see how we improve our DVA to meet the criteria of domestic value at 50%. I think that is the only key reason which is holding us back. There are some of these products which we are expecting approval from the government maybe in this quarter itself. But they are not very significant. So I'm not counting on that. So -- and secondly, for this one product which qualifies the DVA -- major product I am saying, I think is motors. But for that, you need to have stable operations because they see an audit what is your exact DVA, et cetera. So that also, hopefully, we should be able to apply in the next year.

[Operator]

The next question is from the line of Ashish Jain from Macquarie.

[Ashish Jain, analyst]

Am I audible?

[Operator]

No. Sir, we are unable to hear you. Mr. Ashish Jain, may I request you to move to the handset. Sir, may I request that we move to the next participant. Mr. Ashish Jain, we would request you to rejoin the queue, please. The next question is from the line of Ashutosh Tiwari from Equirus Securities.

[Ashutosh Tiwari, analyst]

Yes. Congrats on such as exemplary performance during the quarter. And also probably nobody would have imagined the kind of growth we have seen in lighting segment a few years back or even since the controller. I think these are really very, very strong growth we delivered over the last few years. And first time you closed the lighting revenue crossed the segment revenue. So my first question and probably questions on these two segments only. How do you see going ahead sensor, controllers shaping up over the next few years and also lighting segment?

[Sunil Bohra, executive]

So thanks, Ashutosh. Lighting segment definitely continues to grow and will continue to grow as we speak over the next 4 to 5 years. The key reason I think we have just discussed also is the kit value gain in the new business and also the expected share of business gains moving from 14% to 15% share of business to 30% is not going to be, while we do believe that we do have got businesses in fold, and it's only a matter of time, we will reach that goalpost of 120% share of business. The kit value also has been expanding. So we do expect this momentum to continue. But as I said, the only, what you call, the moving part is the volumes of the model, which we have secured the business so if that business is on track, I'm sure we will be able to deliver the growth in lighting business as we have done in the past. What was the second question?

[Ashutosh Tiwari, analyst]

Sensor, controller, I think we have done roughly INR 775 crores put together.

[Sunil Bohra, executive]

Yes. So sensor, controller, of course, also is doing phenomenally well. Sensor and controller business, both are seeing a significant addition of new business. Controller, some of the EV product business, which are part of UMNR also into that business like telemetrics or wireless chargers and there are lot of other business, which are part of this business, which continues to grow. And also now we have aligned ADAS business also with the control business also, fire sensor which also has a lot of sensors and rated staff to sensor and ADAS internally, we have aligned as a single business. And as sensor also, the number of sensor applications has been consistently going up. And as you may have noted, we have also added one more product to our kitty, it is tire pressure monitoring system center. And we have already secured business from one of the largest OEMs in the country. So hopefully, that should also go into production sometime in the next year.

[Ashutosh Tiwari, analyst]

So I think you mentioned that in the fourth quarter, the controller was INR 130 crores and sensor was INR 100 crores, right?

[Sunil Bohra, executive]

No. No -- yes. Fourth quarter, okay.

[Ashutosh Tiwari, analyst]

Yes. So we're already adding INR 920 crores under in the last quarter. So I think this business also overall will grow very strongly. Like can we assume like, say, a 20% plus kind of growth rate in this business over the next few years?

[Sunil Bohra, executive]

I would definitely like to work on 15%, 20% kind of growth, assuming the industry volumes also support.

[Ashutosh Tiwari, analyst]

Okay. Okay. And lastly, on this alloy wheel 4-wheeler business, don't we think that we are probably a bit behind in terms of category addition because the way is ramping up and the way we are operating, you probably have to fasten the things. So obviously, there's some delay due to this land acquisition and all but going here, probably we have to -- probably drive ahead of what we're guiding right now?

[Sunil Bohra, executive]

No. No. Absolutely, of course, you are right. And that has been the feeling inside the organization because this is a business we all know, we're in very, very close for last 4, even running like hand-to-mouth situation. And this is not a good situation to be in while it is good that before the project is announced, even your surplus capacity gets blocked, but that's what the market is giving and if we are not ready, we might lose the business.

So we have been now working very aggressively in even building this land bank and a large part of this is also identified for alloy wheels. So while we are putting this 120,000 project in Kharkhoda as of now, the space and everything what we have earmarked can grow up 240,000 a year. In addition, we might soon have to even expand our plant in Gujarat, given the volumes are being ramping up there. So there also, we might see some sort of expansion in the current fiscal year. So -- but for your point taken we have to be a little more aggressive in our capacity addition in the 4-wheel alloy segment.

[Ashutosh Tiwari, analyst]

And just one more thing on this Minda Westport that CNG kit business, you mentioned that sales was INR 177 crores in the fourth quarter ? Am I...

[Sunil Bohra, executive]

Quarter?

[Ashutosh Tiwari, analyst]

No, I just missed to say a number. You mentioned some sales numbers for...

[Sunil Bohra, executive]

Full year.

[Ashutosh Tiwari, analyst]

Full year. Okay. And that also will grow quite fast business as well, right?

[Sunil Bohra, executive]

Yes, a little obviously above average margin, and I'm pretty confident over the next few years, this also has a potential to INR 400 crores to INR 500 crores kind of a run rate.

[Operator]

The next question is from the line of Ashish Jain from Macquarie.

[Ashish Jain, analyst]

Sir, my question was, again, on the lighting business. Is it possible to give a sense of volume growth versus value growth that we have seen in the 4-wheeler lighting business particularly?

[Sunil Bohra, executive]

Very difficult to say, Ashish, volume growth versus value growth because even if these are business currently we are or the momentum we are in, even if the industry doesn't grow, this business will grow. But the only issue is that the businesses we are tied up has to grow more. For example, and why I'm saying I think you would have heard in my commentary, I said we have got 3 like long tail lamps, like this tail lamps, the cost is almost INR 15,000 to INR 20,000, almost like per tail lamp, whereas the other model, if you say halogen lamp, it is costing INR 2,500.

So if the volume of that model goes up, then obviously your destiny is linked there. So very difficult to say what volume will grow and how much your sales will grow but my point is even if volume doesn't grow. I think this business will continue to grow, but the only issue is the growth of that high-value business, which is not in our hand. And that's why it's very difficult to say. I think the other colleague also has -- other friend also asked this question, how much of growth we should expect in the next quarter or the next year. So as I said, while we are gearing up our capacities for the kind of growth you expect, but very, very difficult to say whether it be 20% or 25% or 30% growth.

[Ashish Jain, analyst]

Sir, but is it fair given the kind of model launches we are seeing, and particularly the product we spoke about, that is really seeing higher penetration and all. So is it safe to assume that the way industry is moving in terms of model launches and these kind of features. This is like a structural thing and there's no reason for us to believe it will slow down.

[Sunil Bohra, executive]

No, absolutely. If you see some of the global markets, you see the Assam markets to go to Korea or Japan or other countries also. I'm not looking at commenting on the developed world, which has more affordability. I'm commenting on market, which does not have more affordability there. Also, you see the long connected tail lamps is very high. So yes, it might be a case where there may be a structural shift, but it all gets doing by the customer presence and also whether customer is willing to pay that, that delta. But yes, it could be, but difficult to comment on because as of now, not many vehicles have got this connected long tail lamps or headlights.

[Ashish Jain, analyst]

Sir, second question was on switches business and you said it was the last 3 quarters switches business has been pretty much flattish in that INR 900-odd crores kind of time. So how are we seeing that progressing from here on.

[Sunil Bohra, executive]

Yes. So switch business, we all know that we are actually having a alliance share almost in both the segments be it 4-wheeler or 2-wheeler both are above 50% market share. So obviously, to gain beyond that market share is difficult. But even if you see despite that challenge even on a quarter-on-quarter basis, this business has grown from INR 930-odd crores somewhere roughly like 3% to 4%, it has grown quarter-on-quarter.

So I think while your point is valid, but I don't think I can compare this business with the light business where there is a structural change. So -- but if you see year-on-year, on a full year basis, this business has actually grown 14%, whereas the industry, if you see average blended of PV and 2-wheeler has not grown with those revenues, maybe it's like 8% to 10%. So still, there is an outperformance in this despite the exports are currently not to the quantum what we have expected. So this business separately is not, as I said, in the very, very high growth trajectory like alloys and lights, but it will continue to outperform the industry volumes supported with the kit value and exports.

[Operator]

The next question is from the line of Rishi Vora from Kotak Securities.

[Rishi Vora, analyst]

Congratulations on good set of numbers. My first question is pertaining to EV segment. Can you just throw some light on how currently you are seeing the demand trends given the reduction in the FAME subsidy. And also in your order book, can you broadly give us indication on like what amount of order book is from the incumbent 2-wheeler OEMs and what part will be from the new age OEMs.

[Sunil Bohra, executive]

So Rishi, first of all, very difficult to comment on demand. And I think you would have seen persistently we don't comment on industry volumes. What is the kind of penetration or volume, et cetera. We don't try and get our customers but in terms of the EV order book, remember, we normally don't comment on order book also, but we have started commenting on EV order book because they are on the request from every corner to do that.

So I would request not to further ask to split that information. So I think even this information, we have been discussing internally as to how long we should continue to give and if you -- all of you are okay, I would -- at some point, I would like to stop that also because this does not give a full picture of the organization because we are today, almost a INR 20,000 crores organization and aspiring to become multiple fold from here. And when I give only this EV volume, I'm commenting on only a fraction of the total business, which might be okay, which might not be okay. So even we are sort of trying to debate ourselves as to how long we continue this. But my humble request, please not push us to give a further split of these numbers.

[Rishi Vora, analyst]

Understood, sir. And just on the gross margin side, we have seen some uptick in the base metal prices recently. Obviously, our alloy wheel business will have some dependence on aluminum. But apart from that, which would be major commodities for us? And are we seeing any inflation currently in those elements?

[Sunil Bohra, executive]

So Rishi, this is part and parcel of life. Yes, you are right. Recently, aluminum practice has seen a spike, but most of our businesses during this commodity hike period post-COVID. I think we have a set, we have tried to align all our contracts with the customers with the annual price escalation, quarterly or half-yearly price escalation project. So on a full year basis, almost 95% gets passed through to our customers. So that is not any concern for us. So if pricing goes up, we try and collect from customers. If prices go down, we share with the customers. So from that perspective, I think we are pretty hedged.

[Rishi Vora, analyst]

Understood. And sir, the last data question, what would be the full year revenues for 4-wheeler and 2-wheeler alloy wheel business? You might have shared but I just want these 2 numbers?

[Sunil Bohra, executive]

For 4-wheeler and 2-wheeler alloy wheel business?

[Rishi Vora, analyst]

Yes, revenues, full year revenue.

[Sunil Bohra, executive]

Okay. So 2-wheeler alloy wheel business, full year revenue is around INR 670 crores. And 4-wheel is roughly around INR 1,350 crores. .

[Operator]

The next question is from the line of Nishit Jalan from Axis Capital.

[Sunil Bohra, executive]

Yes, just to correct the numbers, which I given INR 1,350 crores was for Minda Kosei only. Yes. Nishit, sorry, go ahead.

[Nishit Jalan, analyst]

Yes. So some good kind of numbers. So one of my question is that you have grown so faster compared to the industry growth. Is it something your market share augments now, especially the bigger segment, the lighting, the alloy wheels, sensor or the seating business.

[Sunil Bohra, executive]

Your voice is very volatile, Nishit.

[Operator]

Yes, sir. Your audio is not clear, sir, may I request you to use your handset, please?

[Nishit Jalan, analyst]

Is it better?

[Operator]

Yes, sir. It keeps breaking. May I request you to use your handset incase if you're using a headset.

[Nishit Jalan, analyst]

Yes. My question was that you have grown ahead of industry and across almost all segments over the last few years. So just wanted to understand what would be your market share across different segments now, alloy wheel, lighting, seating. And maybe sensors and controllers, I would assume you are very small, right now and there's a lot of growth potential. So how are the market shares in these 3 categories in both 2-wheeler and 4-wheeler and how it has moved in the last 3 years? Or any data point you can give us on this would be helpful?

[Sunil Bohra, executive]

Yes. So the market share in 4-wheel alloy wheel is over 40% as we stand today. In terms of market share for 2-wheelers, we are roughly at around 15%, 16%. We are just 6 billion, and I'm analyzing the capacity, not actual sales for '23, '24, 6 million on roughly 35 million kind of consumption. We will be roughly at around 15% market share. Because I'm almost running at capacity for 2-wheel alloy wheel business. In terms of lighting 2-wheeler, we are roughly around 25%, 26%, and 4-wheeler, we are roughly around 15%, 16% -- 16% to 17% now.

[Nishit Jalan, analyst]

And seating you mentioned you are about 50% in both the categories right?

[Sunil Bohra, executive]

No. Seating, we are above 50% primarily in CVOR, not in the 2-wheeler.

[Nishit Jalan, analyst]

Okay. And sir, just -- you just mentioned that one question was that so instead of industry leading passenger vehicles OEMs are talking about a very, very low growth in the passenger vehicle industry this year. Even SIEM has talked about only about 2%, 3% kind of growth. Are you seeing any such slowdown in the volume, industry volumes on the production schedule. So what would be your view in general about the industry growth?

[Sunil Bohra, executive]

So as I said, Nishit, we don't comment on industry volumes, but I can say what volumes we have been guided by the customers to plan for '24, '25 and they tend to be a little low in EV segment, which is 5% to 7%. And for 2-wheeler segment, it is 7% to 10%. But as I said, these are guidance from a customer to be prepared with the capacity. Now whether -- how much actually will happen, I think our customers are best placed to respond to that.

[Nishit Jalan, analyst]

Correct. Correct. And just one number I missed out, what did you talk about the FY '25 CapEx? Was it INR 850 crores for project CapEx and INR 450 crores maintenance, is that correct?

[Sunil Bohra, executive]

Yes.

[Nishit Jalan, analyst]

So total INR 1,300 crores.

[Sunil Bohra, executive]

Yes, INR 1,300 crores to INR 1,400 crores, yes.

[Operator]

Ladies and gentlemen, due to time constraint, that was the last question for the question-and-answer session. I'd now like to hand the conference over to the management for closing comments.

[Sunil Bohra, executive]

Thanks, everyone. So I would like to thank everyone for joining on the call. I hope we have been able to respond to all your questions adequately. For any further information, we request you to please do get in touch with us. Stay safe, stay healthy, and thank you once again for joining with us.

[Operator]

Thank you. On behalf of Uno Minda Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.