Auto parts maker Wheels India Q2 net nearly triples to Rs 21 cr on growth

Revenue for Q2 went up 78% to Rs 911 crore from Rs 511 crore during the July-to-September period of 2020-21

Chennai-based auto components manufacturer Wheels India, has registered a 186 per cent rise in its net profit to Rs 21.2 crore for the second quarter of the financial year ended in September 2021, from Rs 7.4 crore a year ago.

Revenue for Q2 went up 78 per cent to Rs 911.2 crore from Rs 510.9 crore during the July-to-September period of 2020-21. “The quarterly sales growth on a year-on-year basis was across all industry segments. The growth in the export business was strong in the construction equipment, agricultural equipment and windmill industries. This trend, in terms of growth of exports, is likely to sustain,” said Srivats Ram, managing director, Wheels India.

Wheels India is a top maker manufacturer of wheels for trucks, buses, agricultural tractors, construction equipment, utility vehicles and passenger cars with plants in Tamil Nadu, Maharashtra, Uttar Pradesh and Uttarakhand and a combined overall annual capacity of 10.3 million wheels. For the half year ended September 2021, the company posted a net profit of Rs 31.3 crore as compared to a Rs 30.8 crore loss in the first half of the previous year. Revenue for the half year ended September 30 rose Rs 1,585.8 crore from Rs 722.9 crore in the first half of the previous year.

“There is some sign of improvement in the commercial vehicle segment from a low base in the previous year. Export schedules are not affected by the semiconductor shortages, as the segments the Company serves are not affected by this. The Company is making further investments to service export requirements in the coming year. There is a concern that rising commodity prices continue to be a challenge,” Srivats said.

The company said that it has cleared a capital expenditure plan of Rs 37 crore to meet the global demand in the construction equipment and wind mill segments. This is in addition to the Rs 99 crore capex planned during the beginning of the year. The new wind mill plant is expected to become operational in January 2022.

Over 50 per cent of the company’s business accrues from the manufacture of automotive wheels for commercial vehicles, agricultural tractors and cars while the balance comes from wheels/components for construction and mining equipment, air suspension for commercial vehicles and components for energy equipment and railway bogie frames.