Rico Auto Industries- Strong Engineering Capabilities To Ensure Double Digit Growth In Near-Term: ICICI Direct
Order book as on H1 FY23 was at ~Rs 1,350 crore of lifetime order wins with annual peak sales of ~Rs 260 crore.
BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.
ICICI Direct Report
We recently interacted with the management of Rico Auto Industries Ltd. and were impressed by the new order wins at the company by marquee original equipment manufacturer names like BMW and Toyota largely driven by its strong engineering capabilities.
Rico started as a 100% ancillary to Hero MotoCorp Ltd. gradually expanded into passenger vehicle space with Maruti Suzuki India Ltd. It is now serving more than 30 domestic, global customers across all categories. Hero MotoCorp, however, is its largest client.
Also, Rico has developed paper based friction material for two-wheeler clutch applications.
Content/vehicle in two-wheeler typically ranges from ~Rs 2,000-2,500/vehicle, which has increased to ~Rs 4,500 primarily including a pair of alloy wheels. Currently, alloy wheel capacity is pegged at ~3.5 million units that is being expanded to ~4.5 million units with peak revenue potential at ~Rs 500 crore.
The management said it was single source supplier for a set of products to most foreign OEMs for its domestic as well as export demand.
Click on the attachment to read the full report:
This report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime.
Users have no license to copy, modify, or distribute the content without permission of the Original Owner.