ZF Commercial Vehicle control systems India hosted a conference call on Oct 31, 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 Q2 FY24, company witnessed growth in all segments supported by strong replacement demand, increased Government spending and falling raw material prices.

Aftermarket segment registered 14% YoY growth in Q2 FY24 driven by good demand in mining area. Trailer segment has also clocked strong growth.

Exports registered Rs 323 crore of sales in Q2 FY24, driven by launch of new BMW model and ramp up volume of exiting products.

Company intends to focus on margin accretive products to increase profitability.

With improvement in infrastructure and express highways, the need for higher capacity engines and higher gear ratio transmission has increased, this opens up opportunities for automated manual transmission controls in heavy-duty segment.

Company is taking sustained efforts to increase revenue through the introduction of new products for OEMs, fleets, and aftermarket thus creating an increase in vehicle content, better technology penetration, and foraying into new domains for commercial vehicle technology.

Shifting trend of sourcing from India from EU customers like Volvo, BMW, Daimler to help exports continue to grow ahead.

Company expects new business from sale of electronic stability control system to buses, electronic braking system applications, electronic compressors and driver assistance systems.

Company expects ESC regulation to come in truck segment also, which will further provide tailwinds to company’s products.

Utilization of trucks has been increasing and fuel efficiency is improving.

Management indicates that global economic slowdown is expected to intensify.

Ms. Swetha Agarwal will be joining as Chief Financial Officer of the company from 10th Jan 2024.