The company has a positive outlook on the global business due to new contracts even though the automotive segment remains largely stagnant.
The company is targeting profit margins of 12-13%, founder and chairman K Ajith Kumar Rai said.
He said the Controls Division, which accounts for 47% of the business, is expected to grow by 7-8% by the end of the year.
Suprajit recently acquired a €40 million business, which will increase its revenue.
However, it will take some time before this acquisition translates into positive earnings before interest, taxes, depreciation and amortization (EBITDA).
Read also | Suprajit Engineering’s automotive business thrives globally with major contract wins
In early September, BMW announced a reduction in its FY24 forecast due to sluggish demand in key markets such as China.
BMW is not alone in this; several other global original equipment manufacturers (OEMs) have also adjusted their forecasts for the year.
Read also | BMW cuts forecasts: Indian carmakers’ exposure to German giant
Rai believes that as interest rates ease in the US and Europe, the situation is expected to improve within a year.
However, it could take a year or two before the full impact of lower rates is visible, he said.
He said the fight is more intense for smaller competitors, while strong and valuable suppliers like them are gaining market share.
There is consolidation taking place in the sector, from which they are benefiting, which contributes to their growth and improves their margin profile.
“The automotive industry itself is in a tough spot, at least for another year, as I see it in the global market,” Rai added.
The market capitalization of Suprajit Engineering is around ₹7,362.19 crore. Its shares have gained nearly 27% in the past year.
To watch the full interview, see the attached video
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