Wheels India pegs to double hydraulics business in 2-3 yrs: MD

Chennai: Wheels India Ltd, a manufacturer of wheels for trucks, passenger vehicles and construction equipment, after witnessing market opportunities in the exports segment, expects to double its hydraulics business over the next two-three years, a top official said.

The contribution from the hydraulics business to Wheels India Ltd is currently at Rs 150 crore, company managing director Srivats Ram said.

"There are a lot of export opportunities in the hydraulics business and we are expanding to meet the global requirements. We are a supplier to a manufacturer in Europe and North America... We are confident of doubling the hydraulics business in the next 2-3 years from the current level of over Rs 150 crore," Ram said, while declaring the company's financial performance here.

Wheels India was proceeding with its plan committing Rs 225 crore towards capital expenditure for this year, he said.

The city-headquartered company has already earmarked about Rs 225 crore for taking up expansion of the machining of windmill castings, agricultural wheels, cast aluminium wheels and hydraulic cylinders business.

"A large part of the capital expenditure will go into expansion of capacity in wind mill castings, aluminium casting and hydraulics. We are investing in areas where we see growth opportunities. We are also investing in the Agri-Tractor segment," Ram said.

Wheels India Ltd reported net profits of Rs 21.92 crore for the July-September 2024 quarter, as compared to Rs 5.24 crore registered in the corresponding quarter of last financial year. The second quarter of last financial year was impacted due to one off expenses, notably a one-off charge for pre-delivery inspection charges, he said.

Revenues during the July-September 2024 quarter stood at Rs 1,085 crore, as compared to Rs 1,189 crore registered a year ago.

For the half year period ending September 30, 2024, the company reported a jump in its net profits to Rs 47.29 crore, from Rs 18.46 crore registered in the same quarter of last year. Revenues during the six month period ending September 30, 2024 were at Rs 2,174 crore, as against Rs 2,322 crore registered in the same period of last year.

Commenting on the rise in profits, Ram said, "a favourable product mix, notably an increase in machining of windmill castings, productivity improvements and cost control measures have resulted in a good growth in profit for the second quarter in succession. These measures will continue into the second half and we are hopeful of maintaining the profit growth in this trajectory, in the current year." In the Aluminium wheels segment, Ram said the company has taken up ramping up production from 25,000 units to 40,000 units per month.

To a query, he said the company was engaged in increasing its product range. "It is an investment for the long term and we believe that we will reap the benefits of this CapEx in the long run," he said.

On the exports front, he said the contribution from overseas business declined by Rs 50 crore to Rs 258 crore in July-September 2024 period, from Rs 307 crore registered in the same period of last year. "We expect a revival in exports in Q4 this year and for that to continue into Q1 next year," he said.

Ram said Wheels India gained market share in the European market despite the volume being less. "We continue to build a base. When markets pick up, we should benefit in increased volumes," he added.