SHARDAMOTR Q3 FY26 earnings call.

Guidance to track

• Management reiterated that as announced orders for lightweighting and exports reach SOP over FY27–28, the company targets growth meaningfully above industry rates. This is a medium-term directional target, not a quarterly guidance.
• Management committed to sharing product/category-wise revenue break-up (emission vs. lightweighting vs. suspension) on a quarterly basis starting from FY27, addressing a long-standing investor request for better granularity.
• The new Rs 20 crore Uttarakhand plant is designed modular and scalable, planned primarily to service customer volume shift to North India. Management expects high capacity utilization within FY27, implying meaningful revenue contribution next fiscal year.

Risks flagged

• Despite PV production rising ~19% YoY and LCV ~16% YoY, Sharda's gross profit grew only 12% YoY in Q3. Management attributes this to inventory pipeline dynamics, but an analyst directly questioned whether market share is being lost. The 9-month gross profit growth of 7% is closer to industry average, suggesting the Q3 lag may persist if order conversions remain uneven.
• EBITDA margin of 12.1% in Q3 FY26 contracted from an estimated ~13.1% in Q3 FY25, driven by product mix headwinds (higher proportion of lower-margin newer programs). The company has not guided on margin recovery timing, and as new lightweighting SOPs ramp, initial periods may continue to pressure margins before scale benefits materialize.
• Management explicitly stated no capex has been initiated for TM5, and based on customer interactions, a delay or change in implementation is expected. While preparatory work is enabling some indirect export opportunities, the near-term revenue catalyst from TM5-driven redesigns remains entirely undefined and timeline-agnostic.
• The JV in the M&HCV >4-litre segment has been contributing only around Rs 1 crore per quarter despite being a decent addressable market. Management cited limited segment size and a long testing/approval cycle. An analyst raised whether competition or failure to break into more models explains the muted ramp, and management could not provide a concrete timeline for meaningful JV contribution.

Key quotes

• Our growth for this quarter has been lower than the industry growth. The reason for that is there is lot of WIP within the value chain of the automobile industry. Our part goes into engine and then there is an engine inventory which goes into final assembly. Every quarter matching the growth is definitely not possible but you will see on a longer-term basis for 9 months our growth in gross profit is 7% which is very close to the industry growth.
• What we have done is we have augmented our R&D to cater to lightweighting. We are one of the few Indian players now with local capabilities on control arms and links. OEMs and our customers see us making very meaningful relationship like with Dongi partnership — we now access to global design manufacturing engineering benchmarks. This helps us build more customer confidence.
• AI is a huge technology leap and a very exciting opportunity. We are focused on two sides — first is harnessing innovation and effectiveness by starting to implement AI across all business functions and processes internally. The second is seeking growth opportunities in AI infrastructure components plus robotic components. It's still a very early initiative.