This auto component maker has a recipe for 3x revenue jump. Real test lies in execution
Minda Corp has outlined a growth plan, Vision 2030. The stock is up 10% in CY25 and trading at a multiple of 34x its FY27 price-to-earnings. A meaningful re-rating depends on meeting these lofty targets on a timely basis.
Minda Corp. Ltd has outlined a growth plan, Vision 2030, at its recent investor meet. It aims to triple revenue to ₹17,500 crore by FY30 from ₹5,056 crore in FY25, implying a 28% compound annual growth rate (CAGR) from FY25 to FY30.
Growth in existing business, higher exports, premiumization and new products would drive incremental revenue. In the same span, Ebitda margin is set to move above 12.5% from 11.4% in FY25 and return on capital employed, rising to over 25% from 20% in FY25. In reaction, the stock closed 8% higher on Wednesday.
Minda’s shift from a component maker to a full-fledged automotive systems solutions provider is positive. Premiumization is expected to be driven by smart access, cockpit electronics and electric vehicle (EV) harnesses. For new products, joint ventures with Japan's Toyodenso for switches, Taiwan's HCMF for sunroofs and China's Sanco for EV connectors are central to this strategy.
Further, Minda’s research & development spend rose to 4.3% of FY25 revenue, up threefold in four years, with over 300 patents filed. Its 49% stake JV with Flash Electronics adds critical EV technologies like EV traction motors and integrated controllers. Simply put, Minda has a recipe that could help achieve the set goals, but execution is critical.
Some brokerages are hopeful. “In FY25-28E, we expect a revenue CAGR of 13.1%, ahead of 2W industry volume CAGR of 7%, an Ebitda CAGR of 16% and PAT CAGR of 24% driven by ambitious targets set for FY30E," said Elara Securities India in a report on 24 September.
These estimates do not include the financials of Sunroof and Toyodenso. In the past as well, factors including premiumisation and early EV shift have helped Minda record a revenue jump of 21% annually over FY21-25.
Meanwhile, Minda’s revenue mix is set to shift by FY30, with two-wheelers reducing to 40% of revenue from 47% in FY25 and commercial vehicles to 25% from 28%. Passenger vehicles are expected to rise to 25% from 14%.
Minda would support growth through FY30 with ₹2,000 crore capital expenditure plan, fund it through internal accruals, stronger cash flows and a planned ₹1,000 crore release from working capital.
With that, leverage will ease—the net debt-to-equity ratio will fall to 0.3x by FY30 from 0.6x in FY25. Bloomberg data shows that the stock is up 10% in CY25 and trading at a multiple of 34x its FY27 price-to-earnings. A meaningful re-rating depends on meeting these lofty targets on a timely basis.
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