Based in 1963 and primarily based in New Delhi, Shriram Pistons & Rings Ltd. is a distinguished producer of automotive elements, specializing in pistons, piston pins, piston rings, and engine valves. The corporate provides to each home and worldwide Authentic Tools Producers (OEMs) in addition to the aftermarket phase. It holds the excellence of being the biggest producer of pistons, rings, and engine valves within the nation. Past the automotive sector, it additionally serves industries resembling railways, gensets, industrial tools, and defence. As of 30 June 2025, the corporate operates 9 manufacturing items and 5 meeting vegetation, exporting to over 45 international locations throughout 5 continents.
Merchandise and Providers
The corporate’s core product portfolio includes pistons and piston pins, piston rings, engine valves, electrical motors and motor controllers, in addition to precision injection-moulded elements. It additionally presents a variety of extra merchandise, together with cylinder liners, crankshafts, connecting rods, gaskets, and extra.
Subsidiaries: As of FY25, the corporate has 4 subsidiaries and no different three way partnership/affiliate firm
Funding Rationale
- Efficiency of core enterprise – The corporate’s core providing encompasses pistons, piston pins, piston rings, and engine valves tailor-made for the Inside Combustion Engine (ICE) phase. The corporate maintains a powerful and resilient place within the ICE elements market with longstanding relationship with main automotive gamers resembling Maruti Suzuki, Hero MotoCorp, Bajaj Auto, Hyundai, Ashok Leyland, and extra. The ICE enterprise stays a powerful money generator, offering the monetary spine for the corporate’s diversification into rising applied sciences and sectors. Its has long-standing technical collaborations with business leaders resembling KS Kolbenschmidt (Germany) for pistons (since 1965), Riken Company (Japan) for rings (since 1977), Fuji Oozx (Japan) for valves (since 1990), and Honda Foundry (since 1993). Complementing these strategic strikes, SPRL continues to innovate by its state-of-the-art Expertise Centre, specializing in different gasoline applied sciences resembling CNG, LNG, hydrogen, ethanol blends, and hybrid methods, alongside EV elements.
- Diversification methods – The corporate has strategically diversified its enterprise past the standard ICE phase, positioning itself to faucet into future mobility and multi-sector alternatives. The corporate has made focused acquisitions to scale up capabilities in high-growth, future-focused areas. The acquisition of Karna Intertech Pvt. Ltd. has strengthened in-house die-casting mould capabilities, supporting the manufacturing of high-precision elements and enhanced synergies inside SPRL’s provide chain. Equally, the acquisition of SPR-TGPEL Precision Engineering Ltd. has considerably expanded SPRL’s footprint in precision injection-moulded components throughout automotive, electrical, shopper items, and medical sectors – broadening its market attain and technical depth. SPRL additionally entered the EV element house by its acquisition of SPE EMFI in FY23, doubling income from the phase and investing in a brand new Coimbatore facility to fabricate electrical motors and controllers, with manufacturing anticipated to begin by Q2/Q3 FY26.
- Q1FY26 – Throughout the quarter, the corporate generated income of Rs.963 crore, a rise of 15% in comparison with the Rs.837 crore of Q1FY25. EBITDA improved by 16% YoY to Rs.223 crore. Web revenue stood at Rs.135 crore as in opposition to the Rs.117 crore of Q1FY25, a rise of 15%.
- FY25 – The corporate generated income of Rs.3,550 crore, a rise of 15% in comparison with FY24 income. Working revenue is at Rs.836 crore, up by 15% YoY. The corporate posted web revenue of Rs.516 crore, a leap of 18% YoY.
- Monetary Efficiency – The corporate has generated income and web revenue CAGR of 46% and 20% over the interval of three years (FY23-25). Common 3-year ROE & ROCE is round 23% and 26% for FY23-25 interval. The corporate has a strong capital construction with a debt-to-equity ratio of 0.21.
Business
India’s auto element business is experiencing sturdy momentum, pushed by beneficial demographics, rising incomes, and the restructuring of worldwide provide chains. Authorities initiatives such because the PLI scheme, push for EV adoption, and deal with native manufacturing are additional accelerating development. Because the world’s third-largest automotive market and a frontrunner in 2W and 3W manufacturing, India is rising as a worldwide sourcing hub, supported by its strategic proximity to key worldwide markets. Rising automobile demand, particularly within the two-wheeler phase, together with elevated localization by world OEMs, is creating vital alternatives for home element producers throughout each standard and electrical automobile segments.
Development Drivers
- 100% FDI is allowed beneath the automated route for auto elements sector.
- The discount within the tax burden within the 2025-26 Union Funds is predicted to spice up spending among the many increasing center class inhabitants.
- Rising working inhabitants and increasing center class.
Peer Evaluation
Rivals: Sona BLW Precision Forgings Ltd, Bharat Forge Ltd, and so forth.
In comparison with its listed friends, the corporate demonstrates regular income development, superior return ratios, and powerful earnings potential, reflecting its monetary stability and skill to generate earnings and returns from invested capital effectively.
Outlook
SPRL presents a compelling funding proposition rooted in its twin energy: steadfast management within the ICE elements market and a multifaceted diversification technique for future mobility. The administration has given a steering of 15% development sooner or later years. SPRL’s ICE elements phase stays a powerful pillar – characterised by market management, constant development, margin resilience, and powerful profitability. The phase’s monetary robustness and operational integrity present the strategic flexibility essential to broaden into rising mobility applied sciences and diversify the corporate’s development trajectory.
Valuation
We consider the corporate is nicely positioned to maintain its development momentum over the medium to long run, supported by strong growth plans and powerful model recall amongst main OEMs. We advocate a BUY score within the inventory with the goal value (TP) of Rs.3,111, 22x FY27E EPS.
Observe: We additionally encourage sustaining a stop-loss at 20% from the entry value to handle potential draw back danger successfully.
SWOT Evaluation
Recap of our earlier suggestions (As on 22 August 2025)
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