Minda Industries surges 10%, hits record high on strong Q2 performance

With the demand uptick in key markets, and expected easing off of the Covid-19 and semi-conductor situation globally, the company is confident that the uptrend in growth trajectory will resume

Shares of Minda Industries rallied 10 per cent to hit a record high of Rs 944.25 on the BSE in Friday's intra-day trade after the company reported a consolidated profit after tax (PAT) of Rs 113 crore in the September quarter (Q2FY22) on the back of healthy operational performance.

The auto parts & equipment company had posted PAT of Rs 25 crore in June quarter (Q1FY22) and of Rs 100 crore in the year-ago quarter (Q2FY21). The stock surpassed its previous high of Rs 844, touched on November 9, 2021.

In Q2FY22, the company's revenue from operations grew 32 per cent sequentially and 30 per cent year on year (YoY) at Rs 2,114 crore. Earnings before interest, taxes, depreciation, amortization (EBITDA) margin also improved 162 basis point quarter- on-quarter to 10.8 per cent for the quarter, compared to 9.2 per cent in previous quarter. EBITDA margin stood at 14 per cent for the same period last year.

The management said Minda Industries has produced yet another sparkling performance despite the challenges posed by Covid-19, semi-conductor shortages leading to production disruptions, commodity pricing pressures, and fuel price hikes.

With the demand uptick in key markets, a good crop season and expected easing off of the Covid-19 and semi-conductor situation globally, the management is confident that the uptrend in growth trajectory will resume. "Additionally, with our engine-agnostic portfolio, supporting regulatory developments in the country towards electric vehicle (EV) adoption, we firmly believe we are poised to capitalize on these factors and drive sustainable growth going forward," it added.

Analysts at Emkay Global Financial Services expect growth momentum to continue over FY22-24E with a revenue CAGR of 22 per cent, driven by a cyclical upturn in underlying PV/2W segments, higher content in core businesses such as switches, lightings and acoustics, improving presence in alloy wheels, sensors and controllers, and growing content per vehicle led by EV penetration.