Sona BLW Precision Forgings
Sona BLW Precision Forgings
Automobiles F&OKey Fundamentals
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Key Insights
Strengths
5- Company is almost debt free.
- Company is expected to give good quarter
- Company has delivered good profit growth of 23.7% CAGR over last 5 years
- Company has been maintaining a healthy dividend payout of 34.7%
- Company's median sales growth is 24.3% of last 10 years
Weaknesses
1- Stock is trading at 8.57 times its book value
Growth Rate
AI Analysis — Bull vs Bear
Sona BLW Precision Forgings (Sona Comstar) has a market capitalisation of about ₹51,336 crore. Its sales grew at a 24% CAGR over 5 years and 43% on a TTM basis, and it is described as almost debt free. The stock trades at 74.3x earnings and 8.51x book value, while ROE has slipped from a 10-year average of 16% to 12% last year. Over 5 years the share price rose at an 8% CAGR, well behind the 24% profit CAGR over the same period.
- Revenue growth has been consistent over many years: sales CAGR is 27% over 10 years, 24% over 5 years and 19% over 3 years, and median sales growth over the last 10 years is 24.3%.
- Growth has picked up recently: TTM sales grew 43% and TTM profit grew 37%, both above the 3-year CAGR of 19%.
- Profit growth has matched sales growth over the long run, with a 5-year profit CAGR of 23.7% against a 5-year sales CAGR of 24%. That suggests expansion has not come at the cost of profitability.
- The company is described as almost debt free, which reduces financial risk and leaves room to fund capex for EV driveline and motor programmes without much leverage.
- The company pays out 34.7% of profits as dividends while still growing sales above 19% a year, which suggests cash generation that supports both reinvestment and shareholder payouts.
- Share price momentum is strong: the stock gained 103% over 1 year, far ahead of its 3-year CAGR of 12%.
- The 5-year share price CAGR of 8% trails the 5-year profit CAGR of 24%, so the valuation multiple has compressed over that period even though the business kept growing.
- Valuation is demanding at 74.3x earnings, an earnings yield of about 1.35%. On the 3-year profit CAGR of 19%, that implies a PEG of roughly 3.9x.
- The stock trades at 8.51-8.78x book value, a high multiple for a business earning a 12% ROE last year. That price-to-book level usually goes with much higher returns on equity.
- ROE has been falling steadily: 16% over 10 years, 15% over 5 years, 14% over 3 years and 12% last year. This points to lower capital efficiency as the equity base expands.
- TTM profit growth of 37% trails TTM sales growth of 43%, which points to some margin compression in the latest period.
- Shareholder income is minimal: the dividend yield is only 0.42% despite a 34.7% payout ratio, so returns depend almost entirely on multiple and earnings expansion.
- After the 103% 1-year rally, the stock has much less valuation cushion. At 74.3x earnings, any slowdown from the 43% TTM sales growth could hit the price hard.
- Long-term shareholder returns have been modest: the 5-year stock CAGR is only 8% and the 3-year CAGR is 12%, despite 24% profit growth. The market has previously de-rated the stock when growth or sector sentiment weakened.
- The 10-year profit CAGR of 71% probably reflects a low starting base rather than a repeatable rate. The more representative 3-year profit CAGR of 19% is well below what the 74.3x P/E appears to price in.
This is AI-generated analysis, not financial advice. Do your own due diligence.
AI News Digest
- CAFE-III 3x BEV super-credit Sep 30
CAFE-III norms, effective from FY28, give battery electric vehicles a 3x super-credit toward fleet-average fuel efficiency compliance, which pushes OEMs to expand their BEV portfolios. This should raise demand for EV drivetrains and components, the core of Sona BLW's business.
- Related-party transaction postal ballot Sep 4
Sona BLW has started a postal ballot seeking shareholder approval for material related party transactions with Sona Comstar E-Drive Private Limited. Remote e-voting runs from September 4 to October 3, 2026.
- Jefferies India Forum investor meet Sep 14
The company will hold a group investor meeting at the Jefferies 5th India Forum in Gurugram on September 17, 2026, at 9:00 am. This is routine investor engagement and could offer management commentary on EV demand and order book.
TL;DR: Sona BLW's main tailwind is regulatory: the 3x BEV super-credit under CAFE-III from FY28 strengthens the long-term case for its EV drivetrain business. The recent news flow has no clear headwinds. The related-party transaction approval with Sona Comstar E-Drive is a governance item to watch, and the investor meet looks like routine engagement. The structural trend looks favourable, and the key things to watch are the October 3 vote result and how fast OEMs ramp BEV launches ahead of FY28.
Quarterly Results
| Particulars | Jun 2023 | Sep 2023 | Dec 2023 | Mar 2024 | Jun 2024 | Sep 2024 | Dec 2024 | Mar 2025 | Jun 2025 | Sep 2025 | Dec 2025 | Mar 2026 | Jun 2026 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Sales | 674 | 716 | 708 | 793 | 830 | 840 | 786 | 770 | 767 | 1,057 | 1,128 | 1,172 | 1,157 |
| Expenses | 488 | 516 | 494 | 570 | 591 | 606 | 570 | 555 | 575 | 786 | 836 | 887 | 895 |
| Operating Profit | 186 | 201 | 215 | 223 | 240 | 234 | 216 | 215 | 192 | 271 | 292 | 285 | 262 |
| OPM % | 28% | 28% | 30% | 28% | 29% | 28% | 27% | 28% | 25% | 26% | 26% | 24% | 23% |
| Other Income | 4 | 24 | -1 | 6 | 26 | 11 | 39 | 51 | 34 | 20 | -16 | 57 | 90 |
| Interest | 5 | 6 | 7 | 7 | 9 | 10 | 5 | 4 | 5 | 4 | 4 | 6 | 7 |
| Depreciation | 48 | 50 | 51 | 53 | 55 | 57 | 61 | 60 | 60 | 65 | 68 | 67 | 69 |
| PBT | 136 | 168 | 155 | 169 | 202 | 178 | 190 | 202 | 161 | 223 | 205 | 269 | 276 |
| Tax % | 26% | 22% | 22% | 23% | 23% | 26% | 26% | 25% | 26% | 25% | 25% | 23% | 20% |
| Net Profit | 102 | 130 | 122 | 131 | 155 | 132 | 141 | 152 | 120 | 166 | 153 | 207 | 220 |
| EPS in Rs | 1.74 | 2.23 | 2.08 | 2.23 | 2.64 | 2.13 | 2.26 | 2.44 | 1.93 | 2.67 | 2.46 | 3.33 | 3.54 |
Profit & Loss
| Particulars | Mar 2015 | Mar 2016 | Mar 2017 | Mar 2018 | Mar 2019 | Mar 2020 | Mar 2021 | Mar 2022 | Mar 2023 | Mar 2024 | Mar 2025 | Mar 2026 | TTM |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Sales | 346 | 365 | 503 | 609 | 699 | 539 | 1,400 | 1,918 | 2,448 | 2,892 | 3,226 | 4,124 | 4,514 |
| Expenses | 263 | 294 | 398 | 445 | 501 | 388 | 1,014 | 1,439 | 1,831 | 2,067 | 2,322 | 3,083 | 3,403 |
| Operating Profit | 82 | 72 | 105 | 164 | 198 | 151 | 387 | 479 | 617 | 825 | 904 | 1,041 | 1,110 |
| OPM % | 24% | 20% | 21% | 27% | 28% | 28% | 28% | 25% | 25% | 29% | 28% | 25% | 25% |
| Other Income | 2 | -38 | 2 | 7 | 3 | 0 | 23 | 84 | 61 | 33 | 128 | 95 | 152 |
| Interest | 22 | 18 | 19 | 18 | 16 | 23 | 32 | 17 | 16 | 25 | 28 | 19 | 21 |
| Depreciation | 19 | 17 | 17 | 22 | 29 | 34 | 86 | 130 | 167 | 203 | 233 | 260 | 269 |
| PBT | 44 | -2 | 71 | 131 | 156 | 94 | 291 | 417 | 495 | 629 | 772 | 857 | 971 |
| Tax % | 34% | 868% | 36% | 34% | 35% | 10% | 26% | 15% | 22% | 23% | 25% | 25% | — |
| Net Profit | 29 | -16 | 45 | 86 | 101 | 84 | 216 | 354 | 388 | 484 | 580 | 646 | 746 |
| EPS in Rs | 10.42 | -5.76 | 16.19 | 31.02 | 36.28 | 17.83 | 3.77 | 6.05 | 6.63 | 8.26 | 9.32 | 10.4 | 12 |
| Div. Payout % | 0% | 0% | 0% | 0% | 0% | 238% | 502% | 25% | 42% | 37% | 34% | 33% | — |
Balance Sheet
| Particulars | Mar 2015 | Mar 2016 | Mar 2017 | Mar 2018 | Mar 2019 | Mar 2020 | Mar 2021 | Mar 2022 | Mar 2023 | Mar 2024 | Mar 2025 | Mar 2026 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity Capital | 28 | 28 | 28 | 28 | 28 | 47 | 573 | 584 | 585 | 586 | 622 | 622 |
| Reserves | 183 | 167 | 212 | 298 | 399 | 1,084 | 788 | 1,389 | 1,664 | 1,988 | 4,773 | 5,220 |
| Borrowings | 156 | 149 | 158 | 161 | 145 | 330 | 443 | 147 | 291 | 388 | 150 | 363 |
| Other Liabilities | 61 | 73 | 91 | 127 | 167 | 105 | 318 | 386 | 435 | 623 | 609 | 772 |
| Total Liabilities | 428 | 416 | 489 | 614 | 738 | 1,566 | 2,122 | 2,506 | 2,976 | 3,585 | 6,154 | 6,976 |
| Fixed Assets | 125 | 124 | 105 | 165 | 275 | 364 | 1,085 | 1,261 | 1,473 | 1,597 | 1,758 | 3,264 |
| CWIP | 8 | 4 | 6 | 12 | 13 | 50 | 83 | 147 | 91 | 140 | 170 | 92 |
| Investments | 200 | 159 | 162 | 174 | 173 | 860 | 155 | 163 | 370 | 541 | 1,343 | 1,094 |
| Other Assets | 96 | 128 | 216 | 264 | 278 | 292 | 798 | 935 | 1,042 | 1,307 | 2,884 | 2,526 |
| Total Assets | 428 | 416 | 489 | 614 | 738 | 1,566 | 2,122 | 2,506 | 2,976 | 3,585 | 6,154 | 6,976 |
Cash Flow
| Particulars | Mar 2015 | Mar 2016 | Mar 2017 | Mar 2018 | Mar 2019 | Mar 2020 | Mar 2021 | Mar 2022 | Mar 2023 | Mar 2024 | Mar 2025 | Mar 2026 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Operating | — | 38 | 23 | 112 | 143 | 161 | 121 | 395 | 500 | 639 | 733 | 615 |
| Investing | — | -12 | -12 | -98 | -113 | -886 | -117 | -318 | -512 | -453 | -1,737 | -1,541 |
| Financing | — | -25 | -10 | -15 | -31 | 759 | -79 | -62 | 20 | -191 | 1,938 | -3 |
| Net Cash Flow | — | 1 | 1 | 0 | -2 | 34 | -75 | 15 | 8 | -4 | 934 | -929 |
| Free Cash Flow | — | 25 | 17 | 24 | 52 | -13 | -95 | 56 | 166 | 326 | 357 | 237 |
| CFO/OP | — | 82 | 42 | 94 | 97 | 117 | 42 | 92 | 97 | 95 | 99 | 76 |
Ratios
| Particulars | Mar 2015 | Mar 2016 | Mar 2017 | Mar 2018 | Mar 2019 | Mar 2020 | Mar 2021 | Mar 2022 | Mar 2023 | Mar 2024 | Mar 2025 | Mar 2026 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Debtor Days | 58 | 66 | 87 | 85 | 79 | 90 | 104 | 83 | 87 | 73 | 71 | 95 |
| Inventory Days | 77 | 94 | 107 | 149 | 121 | 147 | 169 | 131 | 90 | 92 | 80 | 103 |
| Days Payable | 93 | 122 | 142 | 193 | 123 | 131 | 128 | 81 | 77 | 80 | 76 | 78 |
| Cash Conversion Cycle | 42 | 38 | 52 | 41 | 77 | 106 | 145 | 133 | 100 | 86 | 75 | 121 |
| Working Capital Days | -31 | -52 | 31 | 79 | 6 | 3 | 77 | 88 | 58 | 39 | 117 | 118 |
| ROCE % | 18% | 16% | 24% | 34% | 32% | 12% | 21% | 21% | 22% | 24% | 18% | 15% |
Insights
BetaAI-extracted from concalls & annual reports · figures as reported, with sources
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Company Information
Sona BLW Precision Forgings is an India-based automotive technology company. The company is engaged in designing, manufacturing and supplying engineered automotive systems and components such as differential assemblies, gears, conventional and micro-hybrid motors, BSG systems and EV Traction motors across all vehicle categories. The company develops mechanical and electrical hardware systems, components as well as base and application software solutions.
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