Mohindra Fasteners Limited (MFL), a manufacturer of high-tensile fasteners, faced a challenging FY 2024–25, with revenues declining by ~6.9% and profits dropping ~7.6% YoY, primarily due to weakening export markets. Despite global headwinds, the company maintained resilient profitability, underpinned by cost control, stable raw material prices, and operational efficiencies.
Exports contribute ~70% of revenues, but dependency on international markets has exposed MFL to risks from inflation, tariffs, geopolitical tensions, and logistics disruptions. Management is actively rebalancing toward domestic sales, leveraging its BIS certification and foraying into the industrial after-market segment.
Business: Manufacturer of High Tensile Fasteners used in automotive and engineering sectors.
Established: 1997
Employees: ~400
Listing: Metropolitan Stock Exchange of India (MSEI) – Unlisted in public markets.
Clients:
OEM: Hero MotoCorp Ltd.
Tier-1 vendors: Supplying to Maruti Suzuki, Hyundai India, and Tata Motors.
Manufacturing Base: 3 plants located on Delhi–Rohtak Road, Haryana.
Revenue from Operations: ₹165 Crores (Previous Year: ₹177 Crores) - a decrease of ~6.9%.
Net Profit Before Tax: ₹20 Crores (Previous Year: ₹2 Crores) - a decrease of ~7.6%.
Reason for Decline: Primarily due to a substantial drop in export sales
Domestic Market Growth: Actively taking steps to increase domestic sales to create a healthier balance with exports.
BIS Certification: A key achievement that helps compete against cheap, low-quality imports.
New Business Segment: Started selling in the industrial after-market segment on an all-India basis.
Internal Improvements:
New ERP system implementation.
Replacing old equipment and building a new warehouse.
Standardizing processes for future operational efficiency.
Joint Venture (JV): KK Mohindra Fastenings Pvt. Ltd. (Pune-based JV with Germany's Keller & Kalmbach) is progressing, with efforts to add new customers and leverage BIS requirements.
Quality & Compliance
Certifications: Holds BIS, ISO 9001:2015, IATF 16949:2016, ISO 14001:2015 (Environment), and ISO 45001:2018 (Safety).
📉 Insight:
Domestic Sales (29% of Revenue): ₹51 Crores (slight decrease from ₹52 Crores).
Customers: Hero MotoCorp Ltd and Tier-1 vendors for Maruti Suzuki, Hyundai, and Tata Motors.
Raw Materials: Prices stabilized and followed a downward trend; supply was good.
Export Sales (71% of Revenue): ₹114 Crores (down from ₹125 Crores).
Reasons for Decline:
High inflation and economic slowdown in Western economies.
Impact of new tariffs from the Trump administration (US).
Geopolitical issues: Ukraine/Russia war, Israel-Palestine conflict, and Houthi attacks in the Red Sea disrupting shipping.
Future Hope: New German government's €500 billion infrastructure plan.
Overall Profitability: Stable but Stagnant
Flat Bottom Line: PAT has been stuck at ₹15-16 Crores for three years.
Peak & Decline: FY24 was the best year (₹27 Cr EBITDA, ₹16 Cr PAT), but FY25 saw a drop in operational profit (EBITDA down to ₹23 Cr).
Resilient Margins: Margins (OPM ~14%, NPM ~9%) were defended in FY25, showing good cost control.
✅ Margins remain robust despite revenue decline → strong cost control & lower raw material prices.
Aggressive Growth & Investment: Significant ₹9 Crore increase in Fixed Assets in FY25. This represents Capex in new machinery & plant to expand capacity.
Strong Internal Finances: This expansion is being healthily funded primarily from internal profits, not debt. This is evidenced by a steady ₹24 Crore growth in Reserves & Surplus over three years (from ₹89 Cr to ₹113 Cr), while Borrowings remained flat at ₹37-38 Cr.
Potential Working Capital Pressure: A note of caution is the increase in Inventory to ₹32 Cr in FY25. This build-up could indicate preparation for future sales growth, but it also warrants monitoring for any signs of slowing inventory turnover.
Negative investing CF → heavy capex (new warehouse, equipment).
💡 Operations still generating positive cash to partly fund investments.
FY24 Dividend Paid: ₹5/share (50%)
FY25 Recommended: ₹4.5/share (45%) → reduced due to weaker results.
Share Capital: No change; no DVRs or sweat equity.
Market Data (Unlisted):
Price: ₹295/share
Market Cap: ₹174 Cr
Valuation Ratios: P/E of 11.59, P/B of 1.35, Debt/Equity of 0.32.
Board Changes:
Appointed: Mr. Vivek Arora (Independent Director)
Resigned: Mr. Vinod Kumar (Independent Director, tenure completed)
Key Management Personnel:
Mr. Deepak Arnneja (MD & CEO)
Mr. Ravinder Mohan Juneja (MD)
Mr. Sunil Mishra (CFO)
Market Size (2025E): ₹7,706 billion
CAGR: 6.5–7%
Growth Drivers:
Automotive & construction boom
Government’s Make in India push
Infrastructure investments, urbanization
Challenges:
Price volatility in raw materials
Lack of product differentiation
Digital adoption gaps & supply chain inefficiencies
Key Players: Deepak Fasteners, TorqBolt, Jyoti Engineering, Big Bolt Nut, Kova Fasteners, Kaloti Group, Singhania International, etc.
Market Size: $85.8 Bn (2023) → projected $125.9 Bn (2032).
CAGR: 4.3–4.6% (2024–32).
Regional Split: Asia-Pacific holds ~36% share (2023), expected to reach 45.5% by 2025.
Drivers:
Infrastructure & industrialization
EVs & aerospace demand for lightweight fasteners
Smart fasteners & additive manufacturing
Challenges:
Fluctuating input costs
Supply chain disruptions
Competition from alternative joining technologies (welding, ahesives)
Mohindra Fasteners Limited is a financially stable, moderately growing, and strategically agile company in the high-tensile fastener industry. Despite FY25 revenue and profit pressures, MFL has maintained healthy profitability, low debt, and consistent shareholder returns.
The near-term challenge remains export dependency, but management’s push towards domestic expansion, operational improvements, and diversification (after-market, JV) provides strong growth levers. With supportive industry tailwinds in India and globally, MFL is well-positioned for long-term, sustainable growth.
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