Sansera Engineering - Targeting 20% RoCE Amid Executing Growth Capex: ICICI Securities

Exports and aerospace growth on track as guided.

<div class="paragraphs"><p>Sansera Engineering’s heat treatment facility. (Source: Company website)</p></div>
Sansera Engineering’s heat treatment facility. (Source: Company website)

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ICICI Securities Report

We interacted with the management of Sansera Engineering Ltd. to get mid-year update on its business execution and outlook ahead. Following are the key takeaways:

  1. Revenue is on course to meet the target of ~40% growth in exports in FY24, including ~50% growth in aerospace segment;

  2. supplies to Triumph and Harley for the newlylaunched indigenised models would add to two-wheeler segment revenue growth along with continued premiumisation of overall two-wheeler market;

  3. Ebitdam is on track to be at 17-18% in FY24 and inch up potentially higher in FY25 driven by the rising mix of exports/aerospace;

  4. despite capex of Rs 2.8-3 billion per annum, Sansera is confident of crossing ~20% pre-tax return on capital employed by FY25.

We retain 'Buy' on Sansera with an unchanged target price of Rs 1,133, implying 20 times FY25E earnings.

Click on the attachment to read the full report:

ICICI Securities Sansera Company Update.pdf
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