Gurugram-headquartered Modern Automotives, which is a leading supplier of powertrain, suspension and chassis components to two-wheeler, passenger vehicle, and commercial vehicle OEMs in India, is aiming at a robust 25% CAGR by FY2031.
The company, which supplies forged connecting rods, crankshafts, fork bridges, front fork assemblies, and kick-starter arms to leading two-wheeler OEMs in India, is betting big on the growth potential of the domestic market, while targeting to increase the value of its components by transitioning into becoming a systems integrator. For instance, the company has recently started manufacturing front fork assemblies for scooters and motorcycles.
Modern Automotives is also adopting new manufacturing competencies such as cold forming, which will allow it to strengthen its market position in its existing product categories, while making it diversify into more sectors such as aerospace and defence. It plans to manufacture cold-formed splined shafts, toothed sized gears, as well as heat sinks (from aluminium and copper forming) and deep-extruded transmission shafts from this new cold-forming system that will cater to demand from the automotive, electronics and thermal engineering segments.
Modern Automotives aims to grow its annual forging capacity that currently stands at 36,000 metric tonnes, to 60,000 metric tonnes by FY2031.
Left: The plant in Punjab's Mandi Gobindgarh manufactures connecting rods, crankshafts, pistons, and front fork assemblies for 2W OEMs. Right: State-of-the-art heat treatment machines produce strong and durable forging components.
The company is setting up a new cold forming facility at its mother plant in Punjab (Mandi Gobindgarh), and will leverage it to supply high-quality forging components to its OEM customers.
While Honda Motorcycle & Scooter India (HMSI), India Yamaha Motor, and TVS Motor Co are some of the prime two-wheeler OEM customers for the company in the domestic market, it is also a supplier of differential pinion shafts to BMW (Germany) for its EV powertrains. As per Modern Automotives, the company has received an order worth Rs 150 crore to supply 2.5 million pinion shafts to BMW by 2034, and this will enable it to grow its exports composition to 25% of revenue by 2025.
In the passenger vehicle segment, Modern Automotives acts as a Tier-2 supplier to Honda Cars India, wherein it provides the gears to Musashi Auto Parts India for assembling the carmaker’s 5-speed manual transmission, while also supplying a range of products such as steering arms, steering knuckles, and tie-rods to other OEMs in the country.
In FY2025, Modern Automotives clocked Rs 500 crore, and the company aims to triple its revenue over the next five years. While its EBITDA margins presently stand at 13%, it aims to scale it to 20% level in this period. “Profitability is key to our business and we make any fresh investment with an RoI target of 3-4 years. We are investing Rs 150 crore in FY26, and spend around 2-3% of our topline into R&D every year,” Aditya Goyal, MD, Modern Automotives, told Autocar Professional.
“We aim to register a 25% CAGR over the next five years, and are planning to grow its annual forging capacity from 36,000 metric tonnes to 60,000 metric tonnes by FY31,” he added while pointing out that automation and Industry 4.0 deployment are some of the key measures to augment efficiencies within its existing plants in Punjab, Karnataka, Gujarat, and Manesar.
ENTERING THE ELECTRIC 3W BUSINESS, PARTNERING HONDA POWER PACKOn September 9, 2024 – World EV Day – Bhago Mobility tied up with Honda Power Pack Energy India to incorporate Honda e:Swap’s cutting-edge battery swap technology in its electric three-wheelers
The company has also kicked off another venture – Bhago Mobility – a fleet of L5 electric three-wheelers that are deployed as a pilot in Bengaluru and Delhi for carrying goods and passengers for last-mile mobility operations. The e-mobility venture has seen an initial investment in the range of Rs 15-20 crore towards R&D, and strategically expanding fleet operations.
On September 9, 2024 – World EV Day – Bhago Mobility tied up with Honda Power Pack Energy India to incorporate Honda e:Swap’s cutting-edge battery swap technology in its electric three-wheelers, where discharged batteries can be replaced with fully charged batteries within minutes to enable EV fleets with maximum uptime. According to the company, these vehicles with swappable battery packs will be stationed within a 10km radius of every metro station in Bengaluru and Delhi, offering reliable, convenient and sustainable mobility services.
According to Goyal, the larger goal is to transform the last-mile logistics and mobility categories with more sustainable, affordable, and profitable means of transportation, which will help micro-entrepreneurs unlock potential to grow their income. At present, Bhago Mobility’s L5 three-wheelers deploy swappable lithium-ion battery packs from Honda e:swap, and the company is working on introducing various technology-led solutions such as sun-powered charging hubs, and fleet optimisation to drive efficiency.
Goyal is also keen on venturing into a spree of acquisitions next year, and armed with a war chest of around Rs 500 crore, aims to strike strategic or technology-centric acquisitions under the Modern Automotives umbrella to steer the company towards future growth led by product innovation and technology upgradation.
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