Sandhar Technologies is transforming from a conventional auto-component supplier into a diversified manufacturing company with ambitious growth plans. According to The Financial Express, the company has invested ₹341 crore in four new India projects, generating ₹130 crore revenue in Q1 FY27 but posting losses of ₹7.41 crore from these ventures. Management has set a conservative target of more than 15% revenue growth for FY27 and maintains longer-term ambitions to double revenue every three to four years, targeting ₹10,000 crore revenue and around ₹450 crore PAT with post-tax ROCE of 15% to 20%.
The company delivered strong top-line growth in Q1 FY27, with consolidated revenue rising 26.77% to ₹1,381.89 crore compared to ₹1,090.09 crore in the previous year. As reported by The Financial Express, EBITDA increased 15.23% to ₹117.33 crore and profit before tax rose 40.84% to ₹51.14 crore. However, EBITDA margin compressed to 8.49% from 9.34% in Q1 FY26, attributed to additional minimum-wage costs of ₹5.84 crore, higher energy expenses of ₹7.50 crore, and losses from new projects yet to achieve meaningful volumes.
Sandhar's diversification strategy focuses on aluminium die casting, sheet metal, cabins and fabrication, and electric vehicle powertrain products. According to The Financial Express, the company's existing India business grew 29.34% to ₹1,122.71 crore in Q1 FY27, though EBITDA margin declined to 9.08% from 10.81% a year earlier. The ₹341 crore investment programme includes projects at different stages, with the Hosur aluminium die-casting business targeted for turnaround in Q4 FY27 and Pune cabins in Q3 FY27. The company spent ₹173.05 crore in capital expenditure during FY26 and expects FY27 capex to be in the ₹275-310 crore range.
The company's financial metrics show mixed signals regarding growth sustainability. As reported by The Financial Express, consolidated debt-equity ratio increased to 0.86 in FY26 from 0.81 in FY25, while debtor days rose from 52 to 62 and inventory days increased from 63 to 67. Operating cash flow declined to ₹210 crore in FY26 from ₹247 crore in FY25, with working capital consuming around ₹199 crore, more than double the previous year's ₹96 crore. The company carried goodwill of ₹771.40 crore on a consolidated basis, with ₹716.07 crore allocated to the aluminium die-casting business.
Sandhar's overseas operations contribute 9.3% of consolidated revenue across Spain, Poland, Mexico and Romania, though these subsidiaries reported an EBT loss of ₹4.08 crore in Q1 FY27. According to The Financial Express, the stock was trading at approximately ₹650 per share, representing 19 times earnings. The company's consolidated ROCE stood at 12.3% and ROE at 11.5% in FY26, with standalone ROCE at 17.59% and ROE at 14.60%. The upside potential depends on new businesses turning profitable, overseas losses narrowing, and ROCE moving toward management's 15% to 20% target, while risks include high capex and working capital pressures keeping cash flows under pressure.
