SUNDRMFAST Q2 FY26 earnings call.
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Revenue
₹1,521 Cr
verified against source
Revenue YoY
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EBITDA
Pending
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Where this quarter sits.
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What the record says.
Sundram Fasteners delivered a record Q2 FY26 with PAT of INR 140 crores, the highest quarterly profit in company history, driven by 12% domestic revenue growth and margin recovery. Gross margins returned to 60%+ on softening raw material prices (boron and alloy steel), while EBITDA margin held at 18%. The H1 revenue stood at INR 2,723 crores with PAT of INR 278 crores. Export revenues declined ~13% YoY to INR 338 crores due to weak Class 8 truck demand, EPA 2027 norm ambiguity, and tariff-related uncertainties. Wind energy fasteners grew 30-35% H1, and non-auto segments now constitute 37% of total revenue. Management targets double-digit CAGR over three years and expects export recovery in 6 months as customers signal Q4/Q1 ramp-up. Key risks include EV program deferrals by major customers, persistent US truck market weakness, and potential margin pressure if raw material prices reverse.
Colored figures show movement against the previous available record.
Guidance to track
- Internal company estimate targets double-digit year-on-year growth on constant metal prices basis. Customer raw material price adjustments offset metal cost fluctuations, making growth primarily volume-driven.
- Management expects meaningful recovery in export revenues within 6 months as customers signal early indications of schedule improvements in Q4 FY26 and Q1 FY27. Truck market specifically expected to recover from H2.
- INR 80 crore additional investment in wind energy fastener capacity will start contributing from next financial year, building on 30-35% H1 growth and INR 100 crore already invested.
- Management confirmed current 60%+ gross margin levels are not one-off; softening trend in boron steel and alloy steel prices is expected to continue, providing structural margin support.
Risks flagged
- Most EV programs from key North American customers are being deferred based on market conditions. No new EV orders have been signed beyond existing commitments, with investments on both sides in place but revenues pushed to next year.
- Heavy-duty truck and vocational truck segments continue to underperform due to EPA 2027 emission norm uncertainty and slowed construction activity. This directly impacts the 65% North America export exposure where 40% of exports are CV-related.
- Passenger vehicle growth momentum was strong through festive season, but management acknowledged uncertainty on whether it will sustain post-festive period, creating risk to the 12% domestic growth trajectory.
- Electric vehicle content per vehicle is currently at 80% of ICE levels (vs industry par), constraining revenue capture as EV penetration increases. This structural disadvantage may persist until de novo EV platforms mature.
Key quotes
- We've had about 12% growth in the domestic segment... the profit for the quarter, again, I must report, is the highest at INR 140 crores for the quarter.
- On the EV segment, I would say there is a pause for the moment. I think most of the EV programs from our major customers are getting deferred, depending on the market conditions, primarily in North America. So as of now, beyond what we had signed earlier, the industry itself has not moved much, and we have also not signed any new orders.
- Wind today is about 4% of the overall revenue of the domestic sales, and the bulk of the wind energy revenue comes from domestic segment. And with the given revenue uptick, we have also taken up further expansion of close to about an investment of about INR 80 crores, which should see revenues for wind energy business kicking in additional volume from next financial year.
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