Lumax Industries Limited — Investor Meet, 23-11-2024: Analysts/Institutional Investor Meet/Con. Call Updates

**Financial Performance:** Lumax Industries reported quarterly revenue of INR 812 crore, up 26% year-on-year, while H1 FY '25 revenue reached INR 1,578 crore, reflecting a 25% increase. The consolidated EBITDA for Q2 was INR 62 crore, a 10% growth from the previous year, yielding an EBITDA margin of 7.7%. Profit after tax for Q2 stood at INR 28 crore, marking an 8% increase with a PAT margin of 3.5%. For H1, profit reached INR 62.5 crore, up 26.5% with a margin of 4%.

**Future Outlook and Growth Drivers:** Management highlighted a promising outlook driven by new OEM model launches and positive trends within the two-wheeler segment. The company anticipates improving passenger vehicle sales as festive demand strengthens, despite an initial slowdown. The focus on advancing LED technology positions Lumax well for future growth.

**Order Book and Operational Updates:** The current order book totals approximately INR 2,900 crore, with 87% linked to LED lighting. Noteworthy model launches include the Mahindra Thar ROXX and Nissan Magnite. Management aims for 80% capacity utilization at their Chakan plant with increased orders for major clients like Tata and Volkswagen in FY '26.

**Analyst Q&A Insights:** Analysts probed revenue and profitability projections, with management confident of driving EBITDA margins above 10% in FY '26, primarily from increased LED market share and operational efficiencies. Challenges were noted in the commercial vehicle sector, while capital allocation for FY '25 is set at INR 200-230 crore, with anticipated debt reduction in the upcoming financial year.

**Strategic Focus Areas:** The management’s strategy includes leveraging R&D capabilities to innovate in energy-efficient lighting solutions. Improvement in operational efficiencies and the transition to LED products are central to enhancing profitability.

**Investor Insight:** The company displays robust financial health with strong growth potential in a recovering automotive market. The strategic focus on innovation and operational efficiency suggests a favorable growth trajectory, indicative of a ‘buy’ position for investors seeking exposure to the automotive lighting sector.