Sansera Engineering has received credit rating reaffirmation from ICRA Limited, with the rating agency maintaining its positive assessment of the company's financial and business risk profiles. The reaffirmation covers facilities worth ₹996 crore across various instruments, including long-term fund-based term loans of ₹206.20 crore rated [ICRA]AA(Stable), short-term fund-based working capital facilities of ₹739.50 crore rated [ICRA]A1+, and short-term non-fund based working capital facilities of ₹42.40 crore also rated [ICRA]A1+. As per ICRA, the ratings consider SEL's established position as an auto-ancillary with presence across multiple product segments, reflecting the company's diversified product profile, healthy domestic-export mix, and established market position.
The company demonstrated strong financial performance with revenue growth of 7.4% in FY2025 and 5.6% year-on-year in H1 FY2026, primarily driven by growth in ADS (Aerospace, Defence & Semiconductor) segments. Operating margins remained healthy at 17.2% in FY2025 compared to 17.1% in the previous year, and 17.3% in H1 FY2026. The company's operating income reached ₹3,013.1 crore in FY2025 with PAT of ₹215.8 crore, while H1 FY2026 recorded operating income of ₹1,591.5 crore with PAT of ₹136.4 crore. ICRA notes that the company's financial risk profile is expected to remain strong, aided by healthy revenues and accruals despite sizeable capex plans.
The company's financial profile has strengthened considerably following the Qualified Institutional Placement (QIP) proceeds of ₹1,200 crore in Q3 FY2025, which was largely utilized for prepayment and repayment of borrowings. Key financial metrics show robust performance with total debt/OPBDIT ratio maintained at 0.8 times and interest coverage improving significantly to 14.8 times in H1 FY2026 from 7.2 times in FY2025. The PAT margin also improved to 8.6% in H1 FY2026 from 7.2% in FY2025. The 'Stable' outlook reflects ICRA's expectation that SEL will sustain its credit profile, supported by its strong business position and healthy cash accruals.
Sansera Engineering maintains a diversified business model with a product portfolio of more than 80 components and operates 17 manufacturing plants, including 16 facilities across India and one in Sweden. The company derives 31% of its revenues from exports in H1 FY2026, providing geographical diversification. In H1 FY2026, the company derived 12.7% of revenues from non-automotive segments and 14.4% from auto-tech agnostic segments, showing steady increase in proportion over the years. However, ICRA notes that the ratings are partially offset by SEL's reliance on the Two-wheeler (2W) segment, which accounted for 43% of revenues in H1 FY2026, and customer concentration. Additionally, 73% of revenues in H1 FY2026 came from the auto ICE segment, which remains susceptible to electrification risks, though the company mitigates this by expanding revenue contribution from non-automotive, auto-tech agnostic and xEV segments.
Sansera Engineering has outlined significant capital expenditure plans with over ₹200 crore planned for H2 FY2026 and annual capex plans of ₹350-400 crore in the coming years towards upgradation and expansion of existing facilities. The company maintains a robust order book position of over ₹2,000 crore as of September 30, 2025, diversified across auto internal combustible engine (ICE), electric vehicles (xEV), and non-auto segments from both domestic and overseas markets. ICRA expects the capex to be funded largely through internal accruals, drawing comfort from anticipated healthy accruals and absence of sizeable incremental debt funding.
