Target: ₹571

CMP: ₹522.40

UNO Minda is a leading supplier of proprietary automotive solutions to original equipment manufacturers (OEMs). Its switches, lightning, and casting divisions form 28 per cent, 23 per cent and 21 per cent share of its overall revenue respectively and have posted impressive growth of 23 per cent, 45 per cent and 92 per cent y-o-y in Q2-FY23. These divisions are operating at optimum capacity levels.

The company has announced a capex growth pipeline — at ₹1,664 crore (FY23 capex guidance at ₹700 crore) — to meet incremental demand. Medium to long-term growth drivers get further boost with key announcements in Q2-FY23 — two new JVs, one with Buehler (50.1 per cent stake, ₹110-crore capex) for the BEV traction motors, and the other with Tachi-S (51 per cent stake) taking UNO now into the 4W seating system; expansion of the lighting (capex: ₹400 crore) and alloy wheels (₹190 crore) capacity to fulfil additional orders; it has entered into a technical licence agreement with Asentec Co (Asentec) of Korea to design, develop, manufacture, and market wheel speed sensors in India.

EV Kit value has grown to ₹61,300/vehicle (earlier ₹56,300/vehicle in Q1-FY23) from existing products under production and supply at ₹27,300/vehicle. The company has already received orders for products worth ₹3,000/vehicle, while ₹31,000/vehicle orders are under discussion with potential customers.