ZF Commercial Vehicle control systems India hosted a conference call on Feb 3, 2023. In the conference call, the company was represented by Mr P Kaniappan – Managing Director and Mr RS Rajagopal Sastry – Chief Financial Officer.

Key takeaways of the call

In Q3 FY23, growth was largely driven by improvement in economic activity, government infra push and increase in penetration of CNG/LNG Vehicles.

During the quarter, company achieved 13.9% YoY growth in aftermarket division driven by various initiatives by management and new products.

In Q3 FY23, exports was Rs 282.6 crore.

There are some light duty vehicles where company is having a small portfolio however; company is trying to expand this in the aftermarket space.

Company's engineering team is working on launching hydraulics system going forward.

Growth of electric mobility also opened up opportunity to provide high value content products such as electric compressors. Company has commenced production of electronic compressors.

Company has applied for PLI scheme for certain new products. This would potentially help in increasing content value.

Commercial vehicle registered 41% YoY growth in Q3 FY23.

E-commerce will be a key driver that will drive the demand for commercial vehicles going forward. Connectivity and digitalization is expected to open up new opportunities and avenues for the auto industry.

Company is striving to introduce new business and revenue models through e-commerce.

The company is looking at ramping up its sales, service, and distribution network to effectively cater to fleets and customers across the country.

Company expects increased penetration of newer technologies like Electronic Stability Control (ESC), Advanced Driver Assistance Systems (ADAS), Reverse Parking Assistance System (RPAS) and Driver behavior monitoring system (DBMS).

Regulations mandating high tech braking products is expected to provide tailwinds to company's tech product portfolio/solutions.

Company is planning capex of Rs 250 crore in FY24.