The auto ancillary sector is a network of companies that design, manufacture, and supply essential parts and components to automobile manufacturers. It is a crucial part of India’s manufacturing value chain, closely connected to auto Original Equipment Manufacturers (OEMs).
Auto ancillary companies produce a wide array of products, from basic nuts and bolts to complex engine and braking systems.
Following are the two auto ancillary stocks with a high order book and revenue projections:
1. NDR Auto Components Limited
With a market cap of Rs. 1,597.5 crores, the stock surged nearly 2.3 percent on BSE to hit an intraday high at Rs. 689.8 on Thursday.
Product Developments: The company plans to introduce seat inserts designed to support airbag deployment, particularly in seats with two airbags. This innovation is expected to generate a revenue of Rs. 100 crore by FY28 with an estimated payback period of 2.4 years on an investment of Rs. 21.89 crores, with commercial production targeted to begin in July 2026.
EBITDA Projection: The company aims to achieve EBITDA margins of 11 percent for FY26 and 12 percent for FY27, driven by existing initiatives, without the need for backward integration.
Revenue Growth Expectations: The company anticipates a revenue increase of Rs. 250-300 crore in FY26 from new business segments, including key clients like Kia and Maruti. Ongoing discussions with Kia are expected to result in further orders, with a strong focus on ramping up production volumes.
Order Book: The current order book stands over Rs. 400-450 crore, with an additional potential Rs. 100 crore from the Toyota collaboration, bringing the total to around Rs. 500-550 crore.
NDR Auto Components Limited is primarily engaged in the business of manufacturing, fabricating and assembling every kind of automotive component including seats, spare parts and components for the seats and it deals in each and every kind of activity associated with the manufacture and trading of any kind of components, whether directly or indirectly or whether in India or abroad.
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2. Talbros Automotive Components Limited
With a market cap of Rs. 1,460.8 crores, the shares of an auto component player with a diversified portfolio of gaskets, heat shields, forgings, suspension systems, antivibration products & hoses, surged nearly 1 percent on BSE to hit an intraday high at Rs. 279 on Thursday.
Management Guidance: The management is confident in achieving a revenue target of Rs. 2,200 crores by FY27, driven by increasing business from Indian OEMs. EBITDA margins are projected to stabilize between 16.5 percent and 17 percent moving forward.
Additionally, utilization rates are strong across segments, with the Gasket division at 85 percent and the Heat Shield division at 90 percent.
Management Outlook: The company expects growth in commercial vehicles and a rise in demand in FY26, despite current sluggishness.
Order Book: The company secured new orders worth Rs. 980 crores in FY24, with significant new orders totalling Rs. 1,475 crores in the first 9 months of FY25.
Execution of these projects has already begun, with contributions expected in Q2 and Q3 of FY26. A significant portion of the order book is attributed to electric vehicles (EVs), indicating a strategic shift towards EV components.
Talbros Automotive Components Limited, the flagship manufacturing company of the Talbros Group, is engaged in the manufacturing and forging of automotive & industrial gaskets. It is a market leader in – two-wheeler, agri & off loaders, HCV & LCV segment.
Written by Shivani Singh
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