Sterling Tools Limited — Updates, 19-11-2024: Press Release

Sterling Tools Limited (STL) has received a long-term rating of [ICRA]AA- with a Positive outlook from ICRA Limited, reflecting the company’s strong credit profile and growth within the electric vehicle (EV) components segment. STL has demonstrated resilience against competition, particularly in maintaining a notable EBITDA margin of 14.7% for FY2024.

The company’s wholly-owned subsidiary, Sterling Gtake E-mobility Limited (SGEM), has captured significant market share in the EV sector, holding 40% of the high-speed scooter market and 30% of the electric two-wheeler market as of FY2024. In response to rising demand for EVs, SGEM is expanding its production capacity from 4 lakh to over 6 lakh Motor Control Units (MCUs) annually. The government’s push towards EVs is expected to bolster SGEM’s revenue prospects.

With ongoing investments in innovation and partnerships with key automobile OEMs, STL’s medium-term revenue visibility looks promising, supported by consistent demand growth in the EV market and new customer acquisitions. Investors should view these developments as a positive indication of the company's strategic direction and growth potential.