SONACOMSNSE23 January 2024

Sona Blw Precision Forgings Limited has informed the Exchange about Investor Presentation

Sona BLW Precision Forgings Limited

Date: - 23rd January, 2024

BSE Ltd. Regd. Office: Floor - 25, Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai-400 001. BSE Scrip Code: 543300

National Stock Exchange of India Ltd. Listing Dept., Exchange Plaza, Bandra Kurla Complex, Bandra (East), Mumbai - 400 051 NSE Scrip: SONACOMS

Subject: Investor Presentation for the quarter and nine months ended on 31st December, 2023.

In compliance with Regulation 30 read with Para 15(a) of Part A of Schedule III and other applicable provisions of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, please find enclosed herewith the Investor Presentation inter-alia, encompassing an overview of the Company, its operations and Unaudited Standalone and Consolidated Financial Results for the quarter and nine months ended on 31st December, 2023.

Kindly take the same on record.

Thanking you

For SONA BLW PRECISION FORGINGS LIMITED

Ajay Pratap Singh Vice President (Legal), Company Secretary and Compliance Officer

Enclosed: As above

Q3 & 9M FY24 Earnings Presentation

23 January 2024

Disclaimer

This presentation and the accompanying slides (the “Presentation”), which have been prepared by Sona BLW Precision Forgings Ltd. (the “Company”), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for any securities, and shall not form the basis or be relied on in connection with any contract or binding commitment whatsoever. No offering of securities of the Company will be made except by means of a statutory offering document containing detailed information about the Company.

This Presentation has been prepared by the Company based on information and data which the Company considers reliable, but the Company makes no representation or warranty, express or implied, whatsoever, and no reliance shall be placed on, the truth, accuracy, completeness, fairness and reasonableness of the contents of this Presentation. This Presentation may not be all inclusive and may not contain all of the information that you may consider material. Any liability in respect of the contents of, or any omission from, this Presentation is expressly excluded.

Certain matters discussed in this presentation may contains certain forward-looking statements concerning the Company’s future business prospects and business profitability. Such forward- looking statements are not guarantees of future performance and are subject to a number of risks and uncertainties that are difficult to predict. These risks and uncertainties include, but are not limited to, the Company’s ability to manage growth, the fluctuations in earnings, competition (both domestic and international), economic growth in India and abroad, ability to attract and retain highly skilled professionals, time and cost over runs on contracts, the Company’s ability to manage its international operations, Government policies and actions regulations, interest and other fiscal costs generally prevailing in the economy. The Company does not undertake to make any announcement in case any of these forward-looking statements become materially incorrect in future or update any forward-looking statements made from time to time by or on behalf of the Company.

Our Management

Mr. Kiran Manohar Deshmukh Group CTO

Mr. V. Vikram Verma CEO, Driveline Business

Mr. Sat Mohan Gupta CEO, Motor Business

Mr. Rohit Nanda Group CFO

Mr. Vivek Vikram Singh MD & Group CEO

Mr. Amit Mishra Head, Investor Relations

Financial Performance Highlights

Our net formed differential gears

Q3 FY24 Financial Performance Highlights

7,766 mn | 13%

2,273 mn | 22%

1,327 mn | 24%

Revenue | YoY Growth

EBITDA | YoY Growth

PAT | YoY Growth

29.3% EBITDA Margin

17.2% PAT Margin1

2,219 mn | 28%

BEV Revenue | YoY Growth

30% Q3 FY24 Product Revenue

Share from BEV

Notes: 1.

PAT margin percentage calculated from PAT including non-controlling interest

9M FY24 Financial Performance Highlights

22,995 mn | 19%

6,540 mn | 32%

3,686 mn | 34%

Revenue | YoY Growth

EBITDA | YoY Growth

PAT | YoY Growth

28.4% EBITDA Margin

16.1% PAT Margin1

CY22

CY23

CY22

CY23

7.2% 8.1% Global Market Share of Differential Gears2

4.1% 4.2% Global Market Share of Starter Motors3

Notes: 1. 2. 3.

PAT margin percentage calculated from PAT including non-controlling interest As per Ricardo’s market size estimates for CY22 & CY23 Across light vehicles; as per Ricardo’s market size estimates for CY22 & CY23

Update on our Strategic Priorities

Net formed differential gears coming out of our forging press

Update on our Strategic Priorities

Electrification

Global Market Significance

Diversification

Technology

Sizeable and Increasing Presence in EVs

28%

6,133 mn

31%

9M FY24 Product Revenue

9M FY24 BEV segment

9M FY24 BEV revenue

Share from BEV

revenue

YoY growth

48 (10+15+23)1

EV Programs1 awarded across

28 customers as at the end of

Q2 FY24

53 (10+15+28)1

EV Programs1 awarded across

30 customers as at the end of

Q3 FY24

Notes: 1.

Include only BEV and PHEV programs currently in serial production as well as in the orderbook; numbers in brackets to be read as (# of programs in fully ramped up production + # of programs in ramp-up + # of programs not yet in production)

These three order wins demonstrate our technical prowess to provide solutions for any powertrain architecture

Integrated Motor Controller

Spool Gears

Epicyclic Geartrain and Rotor Shaft

For Electric 2-Wheelers

For Electric SUVs

For Electric PVs

New Customer

Existing Customer

Indian OEM of ICE and EV 2-Wheelers

₹ 3,450 mn

addition in our orderbook

Global OEM of EVs

North American New Age OEM of Electric PVs

₹ 5,700 mn

addition in our orderbook

₹ 990 mn

addition in our orderbook

Q1 FY26

Start of Production

Q4 FY24

Start of Production

H1 FY27

Start of Production

53 EV programs across 301 different customers

No. of programs customers

26 11

13 10

North America 7 Customers 3 17

Europe2 5 Customers 1 5

6 2

Programs in fully ramped-up production

Programs in ramp-up or not yet in production

Programs for geartrain components

Programs for traction motors, controllers, IMCM and PHEV starters

Programs for e-Axle

Asia 4 Customers 2 2 3 1

India 17 Customers 4 8

21 14

+x denotes the change during Q3 FY24

Notes: 1. 2.

2 customers are present in more than one geography Europe geography includes the UK

Our Strategic Priorities

Electrification

Global Market Significance

Diversification

Technology

Our net order book1 grows to ₹240 billion (9.0x FY23 revenue)

221 bn

Orderbook at the end of Q2 FY24

# of Programs

# of Customers

1 bn

Orders consumed from matured and ramp-up programs during Q3 FY24

EV Rs. 190 Billion (79%)

63% 21 9

20 bn

Orders added for programs won in Q3 FY24

240 bn

Orderbook at the end of Q3 FY24

Non-EV Rs. 50 Billion (21%)

10% 14 11

6% 8 8

6% 23 11

7% 22 8

8% 49 18

2W &3W

CV &OHV

OHV

Notes: 1.

Net order book means the aggregate revenue from awarded programs which are either yet to start production or are yet to fully ramp up, in the next 10 years, after adjusting for the negative impact of all programs that are expected to reach end of life or be phased out. We have also applied a discount to accommodate any unforeseen delays or changes in program launches that may happen in the future.

Our Strategic Priorities

Electrification

Global Market Significance

Diversification

Technology

Diversified Product Revenue Mix – By Powertrain

Battery EV increasing as a % of our revenue continues to be our dominant and secular theme

Our pure ICE dependence continues to reduce steadily going from 25% in FY21 to 10% in 9M FY24

FY21

FY22

FY23

9M FY24

14%

27%

34%

25%

26%

31%

18%

26%

21%

38%

15%

28%

24%

38%

10%

Battery EV

Micro-hybrid / Hybrid

Power source Neutral

ICE Dependent

Diversified Revenue Mix

By Geography

By Product

4% 1%

20%

43%

15%

FY23

29%

6% 1%

25%

39%

9M FY24

29%

32%

1% 1%

10%

33%

9M FY24

23%

21%

22%

23%

By Market segment

FY23

69%

15%

12%

Non-Automotive

E2W/E3W

9M FY24

70%

14%

10%

Semiconductors & Embedded SW

0.0%

1.0%

Our Strategic Priorities

Electrification

Global Market Significance

Diversification

Technology

We have introduced one more product – Integrated Motor Controller – in the market

Connected

Zone Monitoring Sensors

Intelligent

Non-ferrous Parts

Robotics Gears

Spool Gear

EDL

Epicyclic Geartrain

Reduction Drive Unit

HV Motor

Electric

HV e-Axle

Active Bias Gears

Lightweight Differential

Park Gear

Input/Rotor Shaft

LV e-Axle

Intermediate Gears

Spiral Bevel Gears

Final Drive Differential Assembly

Differential Assembly

Bot Motor

Non-auto Mobility Motors

Integrated Motor Controller

Magnetless Motor

360˚ Short-range Radar Sensors

In-cabin Sensors

HV Inverter

Integrated Radar Sensor

GaN Inverter

Liquid Cooled Inverter

Suspension Motor Controller

Differential Gear

Starter Motor

Hub-wheel Motor

LV Inverter

Personalized

Legacy Products

Current Products

Future Products

New Products Commercialized in Q3FY24

Note: The product images shown are for illustration purposes only and may not be an exact representation of the products

Mid-drive Motor

Integrated Motor Controller offers several benefits to the customers

Integrated Motor Controller

Motor + Controller

Rotor + Stator +

Power Electronics

+ SW

Compact Design

Simplified Installation and Maintenance

Improved Efficiency and Performance

Reduced Wiring and Connectivity Issues

Customization and Optimization

Aesthetic and Space Considerations

Thermal Management

Communication and Diagnostics

Cost Effectiveness

Functional Safety

Q3 & 9M FY24 Financial Update

Our final drive gears

Q3 FY24 Financials

Revenue (Rs. mn)

EBITDA (Rs. mn)

EBITDA Margin (%)

PAT (Rs. mn)

2 PAT Margin (%)

BEV

YoY: 13%

6,850

7,766

YoY: 22%

YoY: 25%

2,273

2,331

1,862

1,866

YoY: 24%

YoY: 28%

1,327

1,371

1,071

1,074

1,733

2,219

Q3 FY23

Q3 FY24

o BEV Revenue grew by 28% and constitutes

30% of total revenue

o Total Revenue grew by 13% while light vehicle sales in our top-3 markets (North America, India, and Europe) grew by 11%

27.2%

29.3%

27.2%

30.0%

15.6%

17.2%

15.7%

17.8%

Q3 FY23 Q3 FY24 Q3 FY23

(adj)

Q3 FY24 (adj)

Q3 FY23 Q3 FY24 Q3 FY23

(adj)

Q3 FY24 (adj)

o EBITDA margin is higher by ~2.1% (~2.8% in case of adjusted EBITDA) largely due to operational efficiency gains and lower input cost

o PAT margin is higher by 1.6% (~2.1% in case of adjusted PAT) mainly due to improvement in EBITDA margin

o Adjustment to EBITDA

is on account of ESOP cost (₹58 mn) under the newly approved ESOP scheme 2023

for Q3FY24

Notes: 1. 2.

Revenue includes net gain from foreign exchange PAT margin percentage calculated from PAT including non-controlling interest

9M FY24 Financials

Revenue (Rs. mn)

EBITDA (Rs. mn)

EBITDA Margin (%)

PAT (Rs. mn)

2 PAT Margin (%)

BEV

YoY: 19%

22,995

19,316

YoY: 32%

YoY: 33%

6,540

6,606

YoY: 34%

3,686

YoY: 37%

3,801

4,944

4,969

2,755

2,774

4,670

6,133

9M FY23

9M FY24

o BEV Revenue grew by 31% and constitutes

28% of total revenue

o Total Revenue grew by a robust 19% while light in our top-3 markets (North

vehicle sales America, India, and Europe) grew by 14%

25.6%

28.4%

25.7%

28.7%

14.3%

16.1%

14.4%

16.6%

9M FY23

9M FY24

9M FY23 (adj)

9M FY24 (adj)

9M FY23 9M FY24 9M FY23

(adj)

9M FY24 (adj)

o Improvement in EBITDA margin by ~2.8% (~3.0% in case of adjusted EBITDA) largely due to better product mix, operational efficiency gains and lower input cost

o Adjusted

EBITDA

includes adjustment for ESOP cost under the newly approved ESOP scheme 2023

for 9MFY24

o PAT margin is higher by ~1.8% (~2.2% in case of adjusted PAT) mainly due to improvement in EBITDA margin

o Apart from ESOP cost, adjusted PAT for for to

adjustment related

9MFY24 exceptional NOVELIC acquisition

expenses

includes

Notes: 1. 2.

Revenue includes net gain from foreign exchange PAT margin percentage calculated from PAT including non-controlling interest

Key Ratios

VA/Employee cost 6.4

5.7

5.1

5.2

RoCE (%)

RoE (%)

6.3

28.8%

36.1% 32.4% 30.4% 31.7%

30.4%

34.6% 36.3%

26.6% 27.9%

Mar-20 Mar-21 Mar-22 Mar-23 Dec-23

Net Debt to EBITDA

Working Capital Turnover

Fixed Asset Turnover

3.9

4.2

4.4

4.6

5.0

4.7

3.9

3.7

0.76

0.43

(0.01)

(0.12)

(0.08)

Mar-20 Mar-21 Mar-22 Mar-23 Dec-23

Note:

1) 2)

VA/Employee Cost (for manufacturing businesses only) = Material margin / (Employee cost + Manpower cost on hiring) ROCE = LTM EBIT/ Average tangible capital employed + capital deployed for acquiring NOVELIC

ROE = LTM PAT/ Average tangible net worth + capital deployed for acquiring NOVELIC

Net Debt to EBITDA = Short-term & long-term debt less cash, bank balances & mutual fund investments / LTM EBITDA

4) 5) Working Capital Turnover = LTM Revenue/ Average net working capital

Fixed asset turnover (for manufacturing businesses only) = LTM Revenue/ Average Tangible net block

6) 7) Mar-20 numbers are based on pro-forma financials 8)

RoCE and RoE for earlier years have been recalculated due to merger

ESG Update

ESG Performance Highlights

14.4

Low Risk

Top 9%

Negligible

Low

Medium

High

Severe

0-10

10-20

20-30

30-40

40+

Out of 15,842 global companies

ESG Risk Rating (Core)

We have published our second sustainability report in December 2023

Click on the image to read the report

Environmental

Social

Governance

• 10% improvement in emissions intensity in FY23 from FY22

• 2% improvement in water intensity in FY23 from FY22

•

Silver Medal won by Gurugram and Manesar plants in India Green Manufacturing Challenge by IRIM in 2022

• Great Place to Work Certified in Jan 2023 and recertified in Jan 2024 with a higher rating

• Driving incubation of startups innovating for sustainability in partnership with IIT Delhi and IIM Ahmedabad

• 4,958 student lives positively impacted across multiple schools

• Golden Peacock Award won in 2023 for excellence in corporate governance

• 5 independent directors and 2 women directors out of 8 board members

• Promoter holds the position of a non-executive chairman

Q&A

New Product Development Discussion

Appendix

Inside view of our manufacturing plant at Manesar, Haryana

Our story so far…

Phase - 1

• 18 Customers • 2 Plants • 1 Product

Revenue in INR millions

FY99 – 9MFY24 annualized Avg EBITDA margin 26.7% Revenue CAGR 35.2% Industry CAGR 9.4%

Phase - 2

• 22 Customers • 2 Plants • 2 Products

Phase - 3

Phase - 4

• Acquisition of Comstar • 47 Customers (37+10) • 9 Plants (5+4) • 10 Products (5+5)

• Started journey as a public company • 73 customers • 9 plants • 17 products

30,660

9MFY24 Annualized

26,756

FY17– 9MFY24 annualized Avg. EBITDA margin 27.4% Revenue CAGR 30.5% Industry CAGR 4.8%

21,306

22,995 9MFY24

FY12– FY16 Avg. EBITDA margin 25.0% Revenue CAGR 10.6% Industry CAGR 1.7%

FY99– FY11 Avg. EBITDA margin 21.5% Revenue CAGR 50.6% Industry CAGR 16.1%

15,663

12,201

6,992

6,088

5,033

697

910

1,135

1,348

1,174

1,492

2,207

2,807

2,616

3,309

3,456

3,653

5 0 Y F

6 0 Y F

7 0 Y F

8 0 Y F

9 0 Y F

0 1 Y F

1 1 Y F

2 1 Y F

3 1 Y F

4 1 Y F

5 1 Y F

6 1 Y F

7 1 Y F

8 1 Y F

9 1 Y F

0 2 Y F

1 2 Y F

2 2 Y F

3 2 Y F

9 9 Y F

120

223

183

221

0 0 Y F

1 0 Y F

2 0 Y F

3 0 Y F

399

4 0 Y F

Notes: 1. 2.

FY20 onwards financials include Comstar Industry data source: SIAM

4 2 Y F M 9

) . n n a (

One Vision To become one of the World’s most Respected and Valuable Mobility Technology companies for our Customers, Employees & Shareholders.

Guided by Values

Agility

34.5%

Growth

5-year Revenue

CAGR

Vitality

Integrity

Frugality

26.8%

Margins

5-year Avg.

EBITDA

>25%

Returns ROE

Each Year

(FY19-FY23)

Established Global Presence to Serve Customers Locally

USA Location

Capacity3

Tecumseh, MI 1 mn starter motors

Ypsilanti, MI

Belgium

Genk

Germany

Cologne

China Location Capacity3

Hangzhou 1 mn starter motors

7 of the world’s top 10 PV OEMs1a

3 of the world’s top 10 CV OEMs1b

7 of the world’s top 10 tractor OEMs1b

Irapuato 1 mn starter motors

Mexico Location Capacity3

Serbia

Belgrade

Novi Sad

Niš

4 of the world’s top 10 EV OEMs1c

3 of the Indian top 10 Indian e-2-Wheeler OEMs1d

9 4 1 8 3

Manufacturing Plant

R&D Centre

Tool & Die Shop

Warehouse

Engineering Capability Centre

India

Location Capacity3

Gurugram 44.6 mn gears

Manesar

2.0 mn differential assemblies

Pune

11.8 mn gears

Chennai

3.8 mn starter motors 0.4 mn traction motors

Hosur, Sanand, Rudrapur, Mehsana

Notes: 1. 2.

Data Source: a) BofA Global Automobiles Report; b) Ricardo Report; c) EV-Volumes; d) Vahan Database; Company Analysis Capacity as of March 2023

Revenue share from BEV has grown 22x over 5 years, with absolute BEV revenue growth at 47x

Revenue from BEV (%)

BEV Segment Revenue (Rs. mn)

22x

47x

8,177

9M FY24 Annualized

25%

26%

28%

6,707

5,042

14%

1.3%

2.0%

2,057

6,133

9M FY24

174

234

FY19

FY20

FY21

FY22

FY23

9M FY24

FY19

FY20

FY21

FY22

FY23

FY24

Market Shares for Differential Gears and Starter Motors

Global Market Share of Differential Gears1

Global Market Share of Starter Motors1

While we continue to dominate the Indian market for Differential Gears

CY19

4.5%

CY20

5.0%

CY21

6.3%

CY22

7.2%

CY23

8.1%

CY19

2.5%

CY20

3.0%

CY21

4.6%

CY22

4.1%

CY23

4.2%

Passenger Vehicles

Commercial Vehicles

Tractors

55-60%2

80-90%2

75-85%2

Notes: 1. 2.

As per Ricardo report; starter motor market share across light vehicles As per CRISIL report dated Feb 2021

Electrification: Our Approach to Market

Power Rating

> 600 kW

300 – 600 kW

100 – 300 kW

40 – 100 kW

15 – 40 kW

5 – 15 kW

<5 kW

Driveline Solutions

Core Strength: High Torque, High Power Density

Commercial

Personal

EV Products

Motor Solutions

Core Strength: Low Voltage, High Power Density

Personal

Commercial

Epicyclic Geartrain

Spool Gears

EDL

Final Drive assembly

Differential assemblies

Intermediate Gears & Input/Rotor Shaft

Differential gears

Integrated Motor Controller

Controllers

E-Axles

Drive Motors

Hub-wheel Motors

In serial production or in orderbook

To be added between CY24-25

Product Summary

Passenger Vehicles

Spool Gears

Electronically Locking Differential (EDL)

Integrated Motor Controller Module (for Predictive Active Suspension)

Reduction Drive Unit*

In-Cabin Radar Sensors*

Epicyclic Geartrain

360° Short Range Radar Sensors*

Intermediate Gears

Commercial Vehicles

Coupling/ Sleeves

Differential Assembly

Differential Bevel Gears

Traction Motor*

Input/Rotor Shaft

Controller*

Starter Motor

*Product under development

Inter-Axle Gear Set

Product Summary

Buses

Differential Bevel Gears

Controller*

360° Short Range Radar Sensors*

In-Cabin Radar Sensors*

Off Highway Vehicles

Spiral Bevel Gears

Portal Axle Gears

360° Short Range Radar Sensors*

Traction Motor

Light Commercial Vehicles /3-Wheeler (Cargo)

Controller

Traction Motor*

In-Cabin RADAR Sensors*

*Product under development

Starter Motor

Differential Assembly

Differential Bevel Gears

Product Summary

Electric 2-Wheelers

Hub Wheel Motor

Integrated Motor & Controller

360° Short Range Radar Sensors*

Industrial Automation, AGVs & Robots

Robotics Gears*

360° Short Range Radar Sensors*

Drive Motor

Electric 3-Wheelers

2 3

Bot Motors*

Zone Monitoring Sensors*

Controller

Building Automation

*Product under development

e-Axles

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