Fiem Industries hosted a conference call on Nov 14, 2024. 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

The company delivered strong performance in Q2 FY25 driven by uptick in two wheeler volumes. Management expects demand momentum to continue in H2 FY25.

Order book of the company stood at around Rs 1200 crore as of Q2 FY25.

In Q2 FY25, automotive segment contributed 99.88% to total revenue and IPIS & LED luminaries 0.12%.

In terms of product mix, automotive lighting contributed 31.18% to total revenue in Q2 FY25, Automotive LED lighting 41.79%, plastic moulded parts 10.12%, rear view mirrors 11.58% and others 5.33%.

In H1 FY25, automotive lighting contributed 31.85% to total revenue, Automotive LED lighting 40.97%, plastic moulded parts 10.41%, rear view mirrors 11.61% and others 5.16%.

In Q2 FY25, two-wheelers customers contributed 97.68% to total revenue and four-wheelers 2.32%.

In Q2 FY25, Honda two wheeler contributed 28.76% to total revenue, TVS Motor 28.34%, India Yamaha 14.07%, Suzuki Motorcycle 8.92%, Replacement market 5.63%, Eicher Royal Enfield 4.7% and other customers 9.58%.

In H1 FY25, Honda two wheeler contributed 29.37% to total revenue, TVS Motor 26.91%, India Yamaha 14.09%, Suzuki Motorcycle 9.03%, Replacement market 5.8%, Eicher Royal Enfield 3.88% and other customers 10.92%.

In Q2 FY25, domestic OEMs contributed 93.24% to total revenue, domestic replacement market 5.63% and exports 1.13%.

In H1 FY25, domestic OEMs contributed 92.79% to total revenue, domestic replacement market 5.80% and exports 1.41%.

The company is seeing revival of rural demand and consumer spending and expect momentum to continue.

Management guided 15-20% revenue growth in FY25.

The company is confident of growing its four-wheeler business in coming years.

Others Automotive Segment Include items contributing less than 10% of Total Sale, mainly includes Fabrication items, Canister, Bank Angle Sensor etc

In Q2 FY25, company’s LED share was 57% as most of new orders are on LED side. Going forward management expect LED share to rise further to 70%.

Aftermarket sales are lower in the LED market due to its longer lifespan compared to conventional lighting.

The company is working on new technologies in lighting along with several OEMs. Higher technology products and localization will help EBITDA margin to remain steady between 13-14%.

In Q2 FY25, capex was approximately Rs 42 crore, and for H1 FY25, it totaled Rs 74 crore. The target capex for FY25 and FY26 is Rs 125 crore each.

In Q2 FY25, capacity utilization stood at 80%.