Sona Koyo Steering held a conference call on 13 August 2015. Mr Sanjay Kapur, MD took the queries in the call.

Key Points of the call:

Auto component major Sona Koyo Steering Systems reported a 15.9% increase in its consolidated net profit to Rs 4.14 crore for the first quarter ended June 2015. The company had a consolidated net profit of Rs 3.57 crore in the same period last fiscal,.

Sona Koyo's total income from operations on consolidated basis was up 5% during the quarter under review to Rs 374.67 crore as against Rs 357.26 crore in the same quarter, last year.

During the quarter, the Indian automotive sector grew 1.2% in terms of domestic sales.

The PV segment grew 6.2% yoy with volumes of 653,000 units with growth coming mostly from the passenger car industry.

The CV segment was up 3.6% during the quarter.

The company feels that monsoon should revive rural demand.

The company also sees more sales as the festive season comes along.

The company is bullish as Maruti has reported good set of numbers and other OEMs are also coming with new launches.

The company's EBITDA stood at Rs 43 crore, a decline of 2%. This was mainly due to rise in employee cost.

For M&M's new UVs, the company will be present in majority of platforms. It will provide the entire steering systems.

Quarterly contracts with a lag of one quarter is the norm for fixing raw materials prices.

EPAM revenues for the quarter stood at Rs 79 million as against Rs 73 million in previous quarter.

The company sees improvement in EBITDA margin in the coming quarters. Q1 has shown some improvement. Though the company is not extremely bullish, next 3 quarters should be better than first quarter.

The company expects to get maximum market from manual steering as it tries to get it converted to electronic steering market.

There will be some new products for Escorts tractors in EPAM segment. If well received it will take 15% of market in next three years.

In terms of market share from OEMs, Maruti stands at 49%, M&M at 10%, Renault at 9%, Honda at 9%. Exports stand at 5%.