A long-standing auto-ancillary player — once firmly rooted in traditional internal combustion engine (ICE) components — is now attempting a major course correction. The company, known for its backward-integrated manufacturing and legacy supply-chain strength, is retooling to build electric vehicle (EV) components, hoping to ride India’s shift toward electrification.
Historically, the company delivered reliable performance with conventional auto parts — leveraging its integration capabilities to control costs and secure supply. That backward-integration, which delivered stability under older demand cycles, gives it an advantage as it ventures into newer EV-related engineering, which demands tighter tolerances and quality controls.
Now, the pivot to EV tech marks a critical turning point. The company is reportedly developing components (some protected by patents) for a large battery-component enterprise — a collaboration that could scale substantially if EV adoption continues to rise.
But the transition is not risk-free. The auto-ancillary sector is in flux: as ICE demand declines, firms that don’t successfully migrate to EV-related portfolios — or diversify into non-automotive segments — may struggle. The article suggests this firm could emerge as one of the rare “multibagger” success stories — or, in a worst-case scenario, risk falling into trouble.
What to watch:
- How quickly the EV-component business ramps up orders and revenue.
- Execution — whether the company can maintain quality and meet EV OEM standards.
- Balance between legacy ICE business (which provides cash flows today) and new-age EV investments (which may take time to scale).
- The larger auto demand cycle, EV adoption rates in India, and OEM-supplier partnerships.
In short: the company is at a pivotal juncture. For investors with a medium- to long-term horizon and appetite for risk, this could be a high-reward bet — a legacy auto-ancillary potentially transformed into an EV-era supplier.
