This article first appeared on GuruFocus .
Release Date: November 04, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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ASK Automotive Ltd ( NSE:ASKAUTOLTD ) achieved its highest-ever quarterly revenue, EBITDA, and PAT in Q2 FY27, marking the 12th consecutive quarter of robust performance since listing.
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Consolidated revenue grew 47.5% YoY in Q2 FY27, with net revenue growth of 29.5% after adjusting for alloy price pass-through and strategic reduction in wheel assembly business.
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All three product segments performed well: advanced braking systems grew 46%, aluminium lightweighting precision solutions grew 69%, and safety control cables grew 33% YoY in Q2 FY27.
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Export revenue surged 133.3% YoY to Rs. 70 crore in Q2 FY27 and 74% YoY to Rs. 109 crore in H1 FY27, with confidence to exceed the Rs. 180 crore guidance for the full year.
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The company commenced regular supply of high-pressure die-cast (HPDC) alloy wheels to a leading Japanese customer from August 3, 2026, with expected revenue of Rs. 80 crore this year and Rs. 240 crore next year from this customer alone.
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ASK Automotive Ltd ( NSE:ASKAUTOLTD ) commissioned its second captive solar plant of 11.55 MW in Rajasthan in October 2026, reflecting focus on green energy.
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The company continues to outperform the two-wheeler industry, achieving net revenue growth of 39.5% in Q2 FY27 vs. industry production growth of 16.5%.
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EBITDA grew 30% YoY to Rs. 185 crore in Q2 FY27 and 31.3% YoY to Rs. 348 crore in H1 FY27, with adjusted EBITDA margin at 13.5% excluding alloy price impact.
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The company is on an expansion path with Rs. 700 crore CapEx budgeted for FY27 and Rs. 500 crore planned for FY28, funded through internal accruals, with a comfortable debt-equity ratio of around 0.5.
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EV revenue contribution increased to 5.9% in H1 FY27 from 4.8% in H1 FY26, and the company supplies to key EV makers like Ola, Aether, TVS, and Bajaj.
Negative Points
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EBITDA margin percentage appears lower at 11.8% in Q2 FY27 due to the denominator effect from pass-through of significantly higher alloy prices, despite absolute EBITDA growth of 30% YoY.
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Volatility in alloy prices may continue to affect margin percentages, as the company has limited control over raw material price fluctuations.
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Other expenses increased due to a 35% wage increase in Haryana and other states, impacting contractual labor charges.
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Trade receivables increased in H1 FY27 due to higher sales and increased aluminium prices, which may impact working capital.
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The company's EV revenue mix is only 5.9%, and one of its main EV customers, Ola, is not performing well, which could dampen EV segment growth.
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Geopolitical situation remains a concern, with potential impact on export growth and overall business environment.
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The company faces a higher base in Q3 and Q4 of FY26 due to post-GST 2.0 reforms, which may affect YoY growth comparisons in H2 FY27.
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The HPDC alloy wheel business is currently limited to one Japanese customer, with additional Indian OEM supplies expected only in the next financial year, delaying broader revenue contribution.
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The company's guidance for high-teens net revenue growth in FY27 is subject to risks from geopolitical conditions and alloy price volatility.
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Passenger vehicle segment growth, while strong at 79% in Q2 FY27, is still a smaller part of the overall business, and the company remains heavily dependent on the two-wheeler industry.
Q & A Highlights
Q: With H1 FY27 export revenue already at roughly Rs. 109 crore, up 74% year on year, can exports cross Rs. 200 crore for the full year, and have there been any new export order wins? A: Chairman and Managing Director Kuldeep Singh Rathi said the company had earlier guided exports to rise from about Rs. 145 crore to Rs. 180 crore, and management is confident of crossing that guidance. He added that exports are expected to grow more than 25% year on year on average, with even faster growth expected next year, though a clear FY28 guidance will be given in the next quarter.
Q: What is the ramp-up plan for HPDC alloy wheels with the Japanese and Indian OEMs, and what revenue is expected in FY27 and FY28? A: Rathi said regular commercial supplies to the leading Japanese customer began on August 3, 2026, and are continuing daily. The company expects about Rs. 80 crore of alloy wheel revenue from this customer in the current year and orders worth up to Rs. 240 crore next year. The Indian OEM program is in the final stages of testing as it is a safety item, with additional supplies expected only in the next financial year.
Q: What is the CapEx guidance for this year and next year? A: Rathi said the company has budgeted about Rs. 700 crore of CapEx for the current year, though some spending could slip if equipment arrives late. It plans a further Rs. 500 crore next year. He also said the 19th plant, for friction material and brakes, has been commissioned, and the 20th plant is expected to be commissioned around January 14-15, 2027, becoming the fourth plant in Bangalore.
Q: What is the outlook for EBITDA margins, given the impact of higher aluminium prices? A: Rathi said the reported margin of 11.8% in Q2 FY27 is depressed by a denominator effect from pass-through alloy prices. Adjusted for the sharp rise in aluminium prices, margins would be about 13.5% or slightly higher. He stressed that absolute EBITDA grew 30% year on year, in line with net revenue growth, and that margins should be viewed on an absolute basis rather than percentage alone.
Q: What is the current EV revenue mix, and how does kit value compare between EV and ICE vehicles? A: Rathi said EV revenue is currently 5.9% of the mix, up from 4.8% in H1 FY26, partly because one large early EV customer, Ola, is not doing well, though the company has won breakthroughs with other EV customers. Overall kit value is about Rs. 950 for ICE and Rs. 1,250-1,300 for EV, including ALPS, implying a 1.3x-1.4x multiplier. He expects EV to reach about 20% of the two-wheeler market over the next two financial years.
Q: What were the key drivers of the 69% year-on-year growth in the ALPS segment in Q2 FY27? A: Rathi attributed the growth to close association with OEM customers that are outgrowing the industry, as well as sustained investment of at least Rs. 500 crore on average over the last four years, funded by reinvesting profits. He said the company is now reaping the benefits of those investments and that any customer with capacity expansion is awarding business to ASK.
Q: How is the company funding its large CapEx program, and what is the outlook for debt? A: Rathi said ASK has been a cash-generating company for 32 years and is funding this year's CapEx largely from internal accruals. He said debt repayment is not a concern, as the debt-equity ratio is consistently around 0.5 and the company aims to keep debt at about one year of EBITDA. H1 FY27 EBITDA of Rs. 348 crore provides ample cash generation to support the investment cycle.
Q: How should the two-wheeler industry and ASK's growth be viewed in FY28 after a strong FY27? A: Rathi declined to forecast FY28 precisely but said customers are currently very bullish and expanding capacity. He expects industry growth to normalize from the current 20%-plus pace to around 10%, while ASK, as a core supplier, will expand capacity alongside its customers. He added that liquidity in the economy should keep two-wheeler demand intact.
Q: What is the outlook for the passenger vehicle business, and how is ASK positioning itself beyond two-wheelers? A: Rathi said the passenger vehicle business grew 79% in Q2 FY27 and 67% in H1 FY27. He said the company is growing fast in this segment and that its recent investments are fully utilized and profitable, supporting the case for continued expansion beyond two-wheelers.
Q: Why did other expenses rise in Q1 and Q2 FY27, and are they expected to remain elevated? A: Rathi said the increase was mainly due to contractual labor charges following a sharp rise in minimum wages, including a 35% wage increase in the Haryana region. The elevated cost base reflects these statutory wage revisions.
Q: What is the margin profile of the braking systems (ABS) segment versus the ALPS segment? A: Rathi said EBITDA margins are very close across each of the company's segments, effectively similar between ABS and ALPS.
Q: What is the contribution of the independent aftermarket channel, and how is it growing? A: Rathi said the aftermarket business is growing in line with the company and generally outgrows the brakes segment. It typically constitutes about 11% of overall revenue.
Q: Why did trade receivables increase in H1 FY27? A: Rathi attributed the increase in trade receivables to higher sales as well as the increase in aluminium prices.
Q: How is ASK's relationship with Honda evolving as Honda expands capacity and launches new models, and what is the wallet share? A: Rathi said ASK is associated with Honda across all models and will grow in
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
