Sundram Fasteners lines up Rs 350 Cr capex plan to make power train sub-assemblies for EVs

Chennai: Sundram Fasteners Ltd, engaged in manufacturing of auto components has lined up Rs 350 crore capital expenditure plans spread over the next five years, for manufacturing advanced automotive technology components, the company said on Saturday.

Besides, the proposed investment plan, the city-based company would make investments of Rs 300 crore, over the next two years in the wind energy segment, a company statement said here.

Sundram Fasteners reported a 15.6 per cent jump on its standalone profit for the quarter ending June 30, 2022 at Rs 130.11 crore. The company had registered standalone profit at Rs 112.55 crore during corresponding quarter previous year. For the year ending March 31, 2022 standalone profit stood at Rs 407.46 crore.

In a statement, the company said it has chalked out capital expenditure plans of Rs 350 crore spread over five years for manufacturing advanced automotive technology components like power train sub-assemblies for electric vehicles and select internal combustion engine vehicles.

"The investments proposed to be made in this direction are expected to provide a major thrust to the company's exports in the years to come", the statement said.

The standalone total income during the quarter under review grew to Rs 1,246.22 crore, from Rs 948.35 crore registered year ago. For the year ending March 31, 2022 the standalone total income was at Rs 4,198.18 crore.

In a statement, the company said the domestic sales for the quarter ending June 30, 2022 were at Rs 798.50 crore as against Rs 559.93 crore registered previous year, up by 42.6 per cent.

Exports during the quarter under review grew to Rs 405.76 crore from Rs 356.33 crore, reported same period last year.

"The company has registered a strong operating performance and reported highest ever profit despite a challenging environment posted by continuous increase in raw material prices, inflationary impact in indirect materials and steep increase in freight costs and other inputs," company Managing Director, Arathi Krishna said.

"We continue to be cautiously optimistic about the ensuing quarters", she added.

In addition to the Rs 350 crore capital expansion plan for manufacturing advanced automotive technology components, the company said it witnessed a significant potential for growth in the wind energy business.

"To meet the surge in demand, the company proposes to make additional investments of Rs 300 crore over the next two years", it said.

On the development of new products, the company said continued its efforts in producing tower fasteners, valve body housing and swash plate for hydraulic power system, electric water pumps for passenger utility vehicle, 'sintered pulleys' for electric scooters paving the way for better business prospects in future.