Minda Corp Q1 FY26: How Record EV Orders and Strategic Growth Are Defying Auto Industry Headwinds

Minda Corporation Limited, a prominent player in the Indian automotive component industry, has kicked off FY2026 with a robust performance in its first quarter, defying some of the broader industry headwinds. While the market grapples with a July correction and cautious guidance, Minda Corp’s strategic moves and healthy top-line growth paint an interesting picture for what lies ahead. Let’s peel back the layers of their Q1 FY26 investor presentation.

Orders: Fuelling Future Growth?

For a company like Minda Corp, operating in the B2B automotive space, orders are the lifeblood. The presentation highlights a significant milestone: the total lifetime order-book has now exceeded an impressive ₹1,300 crores! What’s particularly exciting about this figure is that over 30% of it is constituted by Electric Vehicle (EV) components. This clearly signals the company’s strong positioning in the rapidly evolving EV ecosystem and offers substantial future revenue visibility.

Furthermore, a newly inked Joint Venture with Toyodenso Japan for advanced automotive switches has already secured a “significant large order from a leading two-wheeler OEM.” While specific order intake numbers for Q1 weren’t detailed, these announcements provide strong forward indicators. The shift towards EV components within the order book suggests a proactive adaptation to market trends and positions Minda Corp as a key enabler in India’s sustainable mobility push. This substantial backlog and new order wins provide a robust foundation for future sales, especially as the gestation period for these projects matures into revenue.

Sales: Outperforming the Pack

Against a backdrop of mixed performance in the broader Indian auto industry (muted PV and CV segments, mixed 2W demand), Minda Corp’s sales figures for Q1 FY26 shine brightly.

Revenue from operations soared by 16.2% year-on-year (YoY) and a healthy 4.9% quarter-on-quarter (QoQ), reaching ₹1,386 crores. This performance is particularly commendable given the overall auto industry’s subdued growth of just 1.9% in Q1 FY26. It suggests that Minda Corp is not just riding market waves but actively gaining market share or benefiting from a product mix that’s in higher demand.

Breaking down the sales performance:

• Information & Connected Systems was a standout performer, growing by 19% YoY. This was driven by significant gains in the Wiring Harness division (increased share of business with existing customers) and strong market interest leading to multiple high-value orders in the Cluster Division. This segment’s robust growth points to Minda’s increasing technological prowess and its ability to capture higher-value components.
• The Mechatronics, Aftermarket & Others vertical also contributed with a solid 13% YoY growth, fueled primarily by strong domestic demand in the 2-wheeler and passenger vehicle segments, along with the premiumization of existing products.

While specific volume vs. price growth wasn’t detailed, the robust growth in both segments amidst an otherwise challenging market implies a healthy combination of increased dispatches and potentially favorable product mix. The company’s adherence to its growth trajectory despite macro headwinds indicates strong operational execution and a resilient business model.

Key Business Metrics: Investing for Tomorrow

Minda Corp’s Q1 FY26 performance isn’t just about the top-line; it’s also about strategic investments and improved efficiency.

EBITDA saw an 18.6% YoY jump to ₹156 crores, indicating strong operational leverage. The EBITDA margin expanded by 23 basis points YoY to 11.3%, though there was a slight QoQ compression. This margin improvement, despite inflationary pressures and potentially higher commodity costs affecting the auto sector, speaks to effective cost management and a favorable product mix.

A critical metric indicating the company’s future readiness is its R&D expenditure as a percentage of revenue, which has consistently increased from 1.3% in FY22 to a remarkable 4.3% in FY25. This persistent investment in innovation, coupled with 6 new patents filed in Q1 FY26, underlines Minda’s commitment to transforming into an advanced technology provider.

The strategic partnership with Qualcomm for Smart Cockpit Solutions further solidifies this focus, aiming to capture the high-growth segment of connected vehicles. The significant “EV Kit Value” of ₹30,000-₹35,000 for 2-wheelers offered by MCL and Flash combined showcases their readiness to capitalize on the EV transition.

The integration of Flash Electronics continues to yield results, with Flash contributing a substantial ₹376 crores in revenue and ₹59 crores in EBITDA in Q1 FY26, showcasing healthy margins of 15.8%.

Earnings: A Closer Look at the Bottom Line

While revenue and EBITDA showed strong momentum, the Profit After Tax (PAT) tells a slightly different story, albeit one with an underlying positive trend.

PAT recorded a modest 1.7% YoY growth to ₹65 crores. However, the 25.5% QoQ jump is significant, indicating a strong rebound from the previous quarter. The PAT Margin, at 4.7%, saw a 67 basis points YoY contraction despite robust revenue and EBITDA growth. Why the disconnect?

A deeper dive into the Profit & Loss statement reveals key movements:

• Other Income saw a notable decrease from ₹8 crores in Q1 FY25 to ₹3 crores in Q1 FY26. This is a positive sign, as it implies that the core business operations, rather than non-operating income, are driving the bulk of the profits.
• Depreciation increased from ₹46 crores to ₹56 crores YoY, reflecting the CapEx undertaken. This is a necessary cost for a growth-oriented company expanding its asset base.
• The most significant impact on PAT came from Finance Cost, which surged from ₹10 crores in Q1 FY25 to ₹33 crores in Q1 FY26. This sharp increase in interest expense likely stems from increased borrowings, possibly to fund acquisitions like Flash Electronics or ongoing growth-related capital expenditures.
• Conversely, Share of profit in associates/joint ventures saw a substantial increase from ₹2 crores to ₹13 crores YoY, providing a healthy boost to the bottom line.

So, while PAT growth appeared muted YoY due to higher finance costs, the underlying operational performance (strong EBITDA growth) and contributions from JVs are positive. The company appears to be in a “Fast Grower” phase, investing heavily for future expansion and technological advancement, which can temporarily put pressure on the reported PAT due to associated financing and depreciation costs. The critical observation is that the core profitability remains strong, and these investments are expected to fuel aggressive earnings growth in future quarters once new projects scale up and debt is optimized.

Capital Expenditure (CapEx) & Financing: Growth Investments

The increased depreciation mentioned earlier hints at ongoing CapEx. The investor presentation explicitly mentions a total investment of around ₹150 crores in the new Joint Venture with Toyodenso Japan, with Minda Corp holding the majority stake. The successful commencement of production at the Die Casting Greater Noida plant also signifies recent CapEx coming online.

These are clearly growth-oriented CapEx initiatives, aimed at expanding product lines (advanced automotive switches), entering new segments (EV components), and enhancing manufacturing capabilities. The significant rise in Finance Costs from ₹10 crores to ₹33 crores YoY strongly suggests that these CapEx and strategic moves (like the Flash Electronics partnership) are being partly funded through increased debt. While the increased debt naturally leads to higher interest expenses in the short term, the nature of these investments – focused on high-growth areas like EVs and advanced electronics – indicates a long-term vision for revenue and earnings acceleration. Investors will want to closely monitor the gestation periods of these new projects and how rapidly they translate into revenue to justify the current increase in finance costs.

Key Takeaways for the Future

Minda Corporation’s Q1 FY26 results underscore its transition towards a more technology-driven, high-growth trajectory within the Indian automotive ecosystem.

• Future Earnings Visibility: The ₹1,300 crore lifetime order book with 30%+ EV components provides strong visibility for future revenues, directly impacting earnings potential. The new JV’s immediate order win further reinforces this.
• Strategic Adaptation: The company is aggressively positioning itself for the EV revolution and connected car technologies through R&D, new JVs, and partnerships like Qualcomm. This proactive approach is crucial in an industry undergoing rapid transformation.
• Operational Resilience: Despite a mixed performance in the broader auto industry and rising finance costs, Minda Corp delivered strong revenue and EBITDA growth, demonstrating effective cost management and demand in its key segments.
• Investment for Growth: The surge in finance costs and depreciation reflects significant investments in expansion and strategic initiatives. This aligns with the profile of a “Fast Grower” that prioritizes long-term growth over immediate PAT maximization. The market will closely watch how quickly these investments translate into disproportionately higher revenue and profit growth.

In conclusion, Minda Corporation is a company actively shaping its future in the dynamic automotive sector. While increased finance costs have tempered current quarter PAT growth, the significant order book, strategic pivot towards EVs and advanced technologies, and robust operational performance suggest a strong foundation for sustainable, aggressive growth in the quarters and years to come.

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