Lumax Industries Ltd Q1 FY2026 Concall Summary

Key Takeaways

• Strong quarter, margin lag: Revenue grew 36.8% y-o-y in manufacturing, but EBITDA at 10.5% missed potential by ~150 bps because OEM price recoveries slipped to Q2.
• Order book is converting: Multiple new wins across 2-wheelers, PVs and CVs drove a capex guidance upgrade to INR 200–250 crore for FY27.
• Wallet share expansion is the core strategy: Maruti wallet share targeted to rise from under 30% to 35–40%, while HMSI tail lamp share could grow 2–3x in FY28.
• Margin recovery is a timing story, not a structural one: Q1 commodity inflation hit before OEM realizations landed; management expects Q2 EBITDA above 10%, with FY27 guidance intact at 10.5–11%.
• What to watch next quarter: Whether Q2 OEM price amendments actually materialize, the pace of Maruti and HMSI wallet share gains, and whether H2 growth holds up against a high base.

Revenue Performance & Customer Mix

• Manufacturing drove the quarter: Manufacturing revenue grew 36.8% y-o-y to INR 1,160 crore, led by Maruti (+43% y-o-y) and Tata Motors (+68% y-o-y) on multiple new model SOPs.
• Others segment surged: The "others" customer category grew 133% y-o-y, mainly from Škoda and Volkswagen business started at the Chakan 3 facility.
• 2-wheeler base is broad: The company caters to almost all 2-wheeler manufacturers including HMSI, Hero, Suzuki, Yamaha and TVS, with significant growth expected from HMSI going forward.
• CV outperformed the industry: CV share of total revenue stayed at about 5% y-o-y, implying CV business grew 30–35% annualized, well above CV industry growth.
• M&M revenue flattish on product mix: Despite 40–50% wallet share, M&M revenue has been flat for 3–4 quarters because Lumax is not on the XUV700 EV platform that drove Mahindra's Q1 volume growth; management expects full-year to align with M&M's overall growth.
• Growth rate caution: Last two quarters' 30% growth came from a low base in H1 last year; H2 growth will slow due to a high base post-GST rationalization, not demand decline.

Anmol Jain: "I don't think that we will continue to report a 30 - 35% each quarter. But I think on a full year basis, the growth revenue forecast is still about a 15 - 20% growth, which is again better than what the industry is expected to clock."

Margins & Cost Recovery

• Q1 margin hit: EBITDA at 10.5% was affected by commodity price inflation driven by the West Asia conflict; approximately 120–130 bps net impact from commodity and other costs, offset by cost discipline and premium product mix.
• The 150 bps gap: Approximately 150 bps margin reduction in Q1 came from OEM price recoveries not yet realized; the company passed on price increases to suppliers but OEM realization is expected only in Q2.
• Monthly amendment failure: Management had hoped OEMs would agree to monthly price amendments due to electronics and commodity price volatility, but this did not happen for most of the industry; only aluminium was accepted for monthly amendment, which does not affect Lumax.
• Q2 margin expectation: Q2 margins expected higher because Q1 realizations will be realized in Q2; management expects above 10%, not sure if 10.5%.
• FY27 margin guidance intact: If Q2 realizations come through, margins would be close to 10.5% to 11% at total EBITDA level, in line with FY27 full-year guidance.

Anmol Jain: "So, we have obviously passed on the price increase to our suppliers, but we are hoping this realization comes in, in Q2. And if you look at that, then the margins would be close to about 10.5% to 11% at a total EBITDA level, which is in line with our guidance for FY 27 in the full year."

Order Wins & Capex

• New order wins: Won orders for multiple products from one key 2-wheeler OEM, plus Suzuki Burgman Street front turning signal lamps, Force Motors Traveller 2 head lamps, Tata Motors Tiago head lamps, and Volkswagen Taigun rear lamps.
• Capex guidance revised up: FY27 capex guidance updated to INR 200–250 crore from INR 100–150 crore, mainly due to new order wins over the last 4 months.
• Brownfield expansion underway: Projects at Sanand and Bawal are progressing to support new order wins with customers at those locations.
• Bengaluru plant timeline: Expansion to support Maruti and Toyota's upcoming models is progressing satisfactorily, expected to be commissioned from Q4 FY27.
• FY28 capex contradiction: Ravi Teltia gave ₹150–200 crore guidance for FY28, but Anmol Jain immediately contradicted, saying "too premature to give FY 28 capex guidance."
• Mould revenue visibility: FY27 mould revenue target is ₹250–300 crore versus FY26's ₹180–185 crore, with majority planned for H2, specifically Q3 or Q4, depending on customer SOP timelines.

Wallet Share & Customer Strategy

• Maruti wallet share target: From less than 30% today, management is looking at probably 35% to 40%.
• HMSI tail lamps: Wallet share likely to increase exponentially by almost 2–3 times in FY28.
• TVS and SMIPL as growth drivers: TVS expected to be a big growth driver; SMIPL (Suzuki Motorcycle India) also expected to become a growth driver in the 2-wheeler segment.
• Market coverage breadth: Associate company SL Lumax already caters to Hyundai Kia, covering 92% of the passenger car market in India; across HMSI, Hero, TVS and Bajaj, the group caters to about 85% of 2-wheeler makers.
• Competition strategy: Competition intensity will increase; strategy is to dominate by being embedded with top 4–5 OEMs in every sector.
• Order book SOP: 60% of order book will be in SOP in FY28.

Deepak Jain: "We want to dominate the industry by being very, very embedded with the top 4-5 of every sector OEMs."

Technology & Localization

• LED is now hygiene: LED lighting accounted for 63% of total revenue, up from 61% y-o-y; approximately 90% of current order book is LED-based.
• Next technology wave: Going forward, multiple other technologies on the lighting front including laser, dynamic lighting and comfort lighting; vehicle lighting contribution going up.
• Content per vehicle rising: Expected to rise from ₹15,000–20,000 to ₹22,000–25,000 over the next 4–5 years, up ~50%.
• Localization timeline: Projectors getting localized gradually over next 2–3 years; bare PCB to go from 40–50% to 70–80% in 2–3 years; connectors from 24% to 40–50%.
• Localization margin benefit: 70 to 90 bps gain expected to flow into business based on currency and import benefits.
• SMT localization success: Company started SMT lines ~6 years ago without orders; now doing sizable in-sourced electronics revenue from Bawal plant.
• Dual-track approach: Where program requirements demand rapid time-to-market or aggressive cost targets, actively collaborating with leading standard module suppliers; simultaneously investing in proprietary Lumax standard lighting modules engineered for India.

Deepak Jain: "As technology and lighting will shift, particularly driven by higher electronic content, I think the localization will continue to remain, although a key priority, but also a challenge."

Growth Outlook & Long-Term Targets

• Revenue CAGR: Confident to deliver above-industry growth over next 3–5 years; CAGR between 15% to 20%.
• Revenue target: From current base of ₹4,500–5,000 crore, targeting ₹9,000 crore or upwards in FY30–31.
• Margin trajectory: FY27 forecast intact at 10.5% to 11% EBITDA; 3–4 year endeavour to hit "teen" EBITDA upwards of 13%.
• Annual margin expansion: ~100 bps increase every year implied.
• EV opportunity: Lighting is powertrain agnostic; as vehicles become more electric, they need more energy efficiency and light weighting, creating bigger value creation opportunity on lighting product.
• CV and tractor traction: Seeing traction in Commercial Vehicle and tractor segments; discussing with various OEMs on new CV platforms.
• Advanced lighting timing: Access exists via Czech centre and Stanley; but for Indian context at reasonable price point, still a couple of years before appearing on Indian models.

Anmol Jain: "I think we are quite confident to deliver an almost above industry growth over the next 3 to 5 years. Our CAGR continues to be between 15% to 20%."

Guidance & Commitments

Key Metrics