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CIE Automotive India hosted
a conference call on Feb 20, 2024. In the conference call, company was
represented by Mr. Ander Arenaza Alvarez- CEO, Mr. K. Jayaprakash- CFO and Mr.
Vikas Sinha- Sr. VP strategy.
Key
takeaways of the call
In India,
tractors sales during Q4 CY23 decreased by 13%, two wheelers sales increased
19%, MHCV sales decreased 1.5% and <6T vehicles (include Passenger Vehicles,
Utility Vehicles, Vans and Light Commercial Vehicles) went up by 4.7% compared
to Q4 CY22.
In India,
tractors sales during CY23 decreased by 2.2%, two wheelers sales increased
3.7%, MHCV sales increased 0.1% and <6T vehicles went up by 6.4% compared to
CY22.
Company
expects India verticals to grow in 2024 supported by new project ramp up.
In terms of
product mix, composites contributes 4% to India sales, gears/machining 6%,
castings 11%, aluminum 18%, stampings 20%, forgings 38% and magnetics 3%.
In terms of
end use segment, cars/UVs and LCVs contributes 52% to India sales, 2Ws 21%,
tractors 18% and MHCV 9%.
In Europe,
<6T vehicles sales during Q4 CY23 increased by 7.3% compared to Q4 CY22. In
CY23, <6T vehicles sales increased by 12.6% compared to CY22.
Europe
delivered flat performance due to Q4 market slowdown and, specifically, the US
off highway market drop.
In terms of
product mix, gears/machining contributes 19% to Europe sales and forgings 81%.
In terms of
end use segment, cars contributes 60% to Europe sales, 2Ws 1%, off-highway 19%
and MHCV 20%.
Europe margin
was positively affected in CY23 mainly by energy price reduction after huge
increases in last quarters of 2022. Going forward, management expects stagnant
business in Europe.
Majority of
new orders in Europe relates to EV components.
Metalcastello
is currently at the bottom of the cycle and expect to suffer drop for the next
couple of quarters.
Company
expects capex to be in range of 5% of total sales for CY24. Company’s capex is
concentrated mainly in India and Mexico.
Management
intends to improve margins driven my focus on internal efficiencies.
Board approved dividend of Rs 5 per ordinary equity share of face
value of Rs 10 each for the financial year ended 31st December 2023. Record
date for the purpose is 13th June 2024.
Board approved
a proposal for increase in capital of Bill Forge De Mexico, S.A. DE C.V. (BF
Mexico) and to waive the right of first refusal to subscribe to the said
capital increase. CIE Galfor S.A.U (Galfor), the other wholly owned subsidiary
of the Company in Spain, shall subscribe the said capital increase.
Company
completed closure of operations by BFPPL and has further considered and
approved the proposal to launch a process of voluntary liquidation of BFPPL.
The said process is expected to complete within a period of 12 months.
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