Recently I came across India Nippon Electricals (NSE – INDNIPPON).
The company is a leading maker of Ignition Systems for 2 wheelers and is now expanding into future technologies such as sensors, controllers, converters and engine control units etc.
It came to my notice because since the last 4-5 years the company has been reporting good growth in sales and profits.
Below, we have shared notes from the Q4 FY 25 presentation of the company to understand the company better.
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India Nippon Electricals – Q4 FY 25 presentation notes
Source: Indian Nippon Electricals Q4 FY 25 presentation
Company Snapshot & Overview:
- Ownership: Owned by Lucas Indian Service Limited, a wholly-owned subsidiary of Lucas-TVS Limited
- Initial Focus: Initially established to manufacture electronic ignition systems for two-wheelers, three-wheelers, and portable engines
- Market Position: Retained No. 1 position in ignition systems for the last three years and outpaced industry growth
- Debt Status: The company is Debt Free
- Revenue CAGR (3 Year): 14.26%
- Supplier Status: Is a Tier 1 supplier to Major Auto OEMs
Product Offerings & Capabilities:
- Electronic Ignition System: A modern automotive ignition system that replaces conventional mechanical ignition systems, igniting the air-fuel mixture in engine cylinders at the right time for combustion and power generation
- Expansion: Has recently entered the market for electric vehicles (EVs)
- Future Technologies: Continues to expand its product portfolio and capabilities with future technologies such as sensors, controllers, converters, and engine control units (ECUs), in addition to its internal combustion engine (ICE) offerings
- Technology Centres: Has a state-of-art Tech centre located in Tamil Nadu, Puducherry, and Haryana. A recently established world-class Technology center in Tamil Nadu focuses on developing EV technology products and technologies for emission control and compliance
- Aftermarket: A dedicated team focuses on aftermarket business, with measures taken to strengthen brand image, product range, sales promotion, and distribution network. INEL also conducts skill development programs for 2-wheeler mechanics
Future Growth Strategies:
- Capitalizing on Core Business: Focused on exploiting opportunities in core business by introducing new products for two and three-wheelers
- Growing EV Portfolio: New R&D Centre and talent will benefit the development of differentiated products and new technologies for EVs
- Expanding to New Geographies: Focused on expanding presence to new geographical locations and penetrating deeper into existing markets
- Advancing Aftermarket Business: Strengthening product range and distribution network to extract maximum value
- Entering into New Technical Partnerships: Recently partnered with Borg Warner (a globally leading automotive supplier) for a Technical Licensing partnership for the Control unit for Electronic Fuel Injection (EFI ECU). This will enable entry into a new product segment of the EFI system for two and three-wheeler applications
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Ekansh Mittal
Research Analyst
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