Fiem Industries hosted a conference call on June 1, 2023. In the conference call, the company was represented by- Mr. J.K. Jain, Chairman & Managing Director, Mr. O.P. Gupta, Chief Financial Officer and Mr. Arvind K. Chauhan, Company Secretary.

Key takeaways of the call

Despite challenges like geopolitical issues and higher interest rate environment, two wheeler industry posted 17% YoY growth. Management expect industry to post double-digit growth in FY24.

Management expects to outperform the two-wheeler industry in FY24 given its diversified product mix, increasing share of business with existing customers and addition of new customers.

Company expect EBITDA margin to be around 13.5% going forward.

In FY23, automotive segment contributed 99.59% to total revenue and IPIS & LED luminaries 0.41%.

In terms of product mix, automotive lighting contributed 36.64% to total revenue in FY23, Automotive LED lighting 35.23%, plastic moulded parts 11.11%, rear view mirrors 11.52% and others 5.5%.

In FY23, domestic OEMs contributed 90.16% to total revenue, domestic replacement market 6.88% and exports 2.96%.

Company generates majority of its revenue from two-wheeler segment. During FY23, two-wheelers customers contributed 96.67% to total revenue and four-wheelers 3.33%.

Company is seeing huge business potential in 2-Wheeler EV segment and looking to expand its product portfolio to cater this segment. Company is currently working with 20+ EV OEMs such as Ola, Okinawa, Bounce, Hero Electric, and several others.

In FY23, Honda Motorcycle contributed 29.08% to total revenue, TVS Motor 24.54%, India Yamaha 15.33%, Suzuki Motorcycle 8.61%, Replacement market 6.88%, Eicher Royal Enfield 3.6% and other customers 11.96%.

In FY23, company’s wallet share in TVS tail lamps was 86%, Yamaha tail lamp was 60% and Suzuki tail lamp was 71%.

Faster and wider adoption of LEDs is an important growth trigger for the company, as these are high-value and high-margin products.

Company received approval for Integrated Passenger Information System with LED Display (IPIS) from Ministry of Railways - Research Design and Standard Organization (RDSO) for manufacture and supply of this system.

In FY23, working capital days reduced to 22 days from 23 days in FY22.

Capex for FY23 was around Rs 54.2 crore.

Current order book is close to Rs 950 crore.

Board Recommended a Final Dividend of Rs 30 per Equity Share of face value Rs 10 each, for Financial Year 2022-23. Record date for the purpose is 21 July 2023.