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Varroc Engineering order win for Rs 5,178 cr includes key seven EV customers
Industry News- May 25,23
Varroc Engineering bags order for Rs 5,178 crore during FY23 out of which Rs 1,796.8 crore oreder is from EV manufacturers. Company’s consolidated revenue from continued operations was Rs 6,863.1 crore in FY 22-23, registering a growth of 17.4 per cent on YoY basis.
Varroc Engineering, a major supplier of automotive components, revealed on that it had secured new orders worth over Rs 5,178 crore during FY23. Out of this total, Rs 1,796.8 crore came from business wins with seven prominent electric vehicle (EV) customers. The company stated that 56 per cent of the order wins were from four-wheeler manufacturers, while the remaining 44 per cent came from two and three-wheeler manufacturers.
Varroc Group is a leading manufacturer and supplier of electricals, polymers, metallics, and exterior lighting systems to top original equipment manufacturers (OEMs) globally. They have comprehensive capabilities in design, development, and manufacturing for various vehicles, including two-wheelers, three-wheelers, passenger vehicles, commercial vehicles, and off-highway vehicles. In FY23, the group achieved revenue of Rs 6,920.9 crore from continuing operations.
Tarang Jain, the Chairman and Managing Director of Varroc, said, “Our consolidated revenue from operations grew by 2.6 per cent on YoY basis to Rs 1,701.1 crore during Q4 and by 17.4 per cent during full year. Our EBITDA margin was at 9.5 per cent and it improved on YoY basis by 340 bps due to business mix, recovery and operating leverage. Sequentially also the EBITDA margin has gone up by 170 basis. The reported PBT for the quarter was Rs 41.1 crore. The early signs of an increase in rural consumption and strong domestic economy are expected to augur well for a good FY24.”
He further commented that on the automotive industry in India during Q4 FY23, stating that most segments experienced year-on-year growth due to the resolution of semiconductor issues and improved economic activity. However, the two-wheeler segment, which contributes around 70 per cent of Varroc's revenue, saw a decline of 3 per cent due to geopolitical challenges impacting exports and reduced consumption in rural areas affecting domestic demand.
“Our strong R&D capabilities helped us in filing 15 patents in FY23 from the group, besides enabling us to commercialise new products in this financial year. During the current financial year, our businesses will continue their focus on profitability improvement, FCF generation, prudent capital deployment and debt reduction. We also got ‘Ind A+’ with stable outlook rating from India Ratings.”
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