Sundram Fasteners rose 1.20% to Rs 974.60 after the company announced that it secured a $250-million contract from a leading global automobile manufacturer for supplying sub-assemblies for its electric vehicle (EV) platform.
The company said plans to invest Rs 200 crore to support the new orders under the six-year long purchase package involving the supply of shaft sub-assemblies and drive gear sub-assemblies.
The company will ship the parts from its powertrain divisions located at Mahindra World City in Chengalpattu, Tamil Nadu, and Sri City in Tirupati district, Andhra Pradesh. The parts will be serviced from the company's warehouse in North America.
The deal is one of the largest won by a supplier in India for this range of products for an EV platform. The company has estimated an annual sales peak of $52 million in 2026 with a supply of 1.5 million drive unit sub-assemblies per annum.
The sub-assemblies will be used in the EV models like MHEV/PHEV/BEV, covering various segments including mid-size trucks, SUVs and sedans. The launch of the new vehicles is planned from the North America platform in 2024.
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Arathi Krishna, managing director, Sundram Fasteners said, "We are extremely delighted to win this prestigious award that marks a significant milestone in our Company's history. The $250-million supply contract, one of the largest in India, is a further testimony to our commitment to manufacture and supply high-quality industry-leading products such as sub-assemblies, which are used widely in various segments of the EV sector. The win underscores the trust and confidence reposed in us by our clients both in India and globally. Going forward, it will spur expansion of our global business as we continue to work on our strategic roadmap for the future."
Chennai-based Sundram Fasteners makes high-tensile fasteners, powder metal components, cold extruded parts, hot forged components, radiator caps, automotive pumps, gear shifters, gears and couplings, tappets, iron powder, powertrain components and sub-assemblies.
On a consolidated basis, net profit of Sundram Fasteners declined 5.87% to Rs 115.29 crore on 12.83% rise in net sales to Rs 1401.65 crore in Q2 September 2022 over Q2 September 2021.
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