Lumax Auto Technologies Ltd

Message from the Management

Historic Highest Revenue and Profitability

For the Company in FY 2023-24.

Dear Shareholders,

We are thrilled to announce that FY 2023-24 marks the most successful year in our Company's history in terms of financial performance. This remarkable achievement highlights our strong commitment to delivering high- quality, diverse automotive technologies and solutions to our customers.

The global automotive market, with its intricate web of supply chains and technological advancements, has faced significant challenges over the past year. Supply chain disruptions, inflationary pressures, and geopolitical tensions have tested the resilience of businesses worldwide. Yet, in the middle of these hurdles India managed to navigate challenges with remarkable efficiency, demonstrating resilience and adaptability.

The country's robust economic policies, coupled with a proactive approach to managing external shocks, have been pivotal in sustaining growth. India's economic resilience is particularly evident in the automotive sector, which has shown a strong correlation with the nation's overall GDP growth. The Indian economy has benefited from several strategic initiatives aimed at fostering industrial growth and development. Government policies and incentives have provided significant support to various sectors, including the automotive industry. This has created a favorable environment for businesses to thrive, even in the face of global economic headwinds.

In the ever-evolving landscape of the automotive industry, change is not just a constant—it's the driving force behind progress. As automobiles become increasingly sophisticated and integral to our daily lives, the quest for innovation and excellence has never been more vital.

Imagine a world where automobiles are not just modes of transport but marvels of technology, seamlessly integrating with our modern lifestyles. Moreover, the growth of the automotive industry is closely tied to the country's GDP growth, presenting a multi-decade opportunity for expansion.

There is a growing demand for high-end vehicles, particularly in the passenger vehicle and 2-wheeler segments. This trend presents a valuable opportunity for LATL to increase our content per vehicle and enhance our market presence. Consumers are increasingly inclined toward high-end features and cutting-edge technologies in automobile.

The increase in working population, urbanization, improved infrastructure, and higher incomes have significantly boosted demand for automobiles, as more individuals seek personal mobility solutions. Additionally, supportive government policies and incentives have played a crucial role in this growth trajectory, providing a strong foundation for the expansion of the automotive sector. Additionally, India's emergence as a global hub for auto component sourcing, has strengthened the industry's growth prospects. The strategies, aimed at diversifying supply chains away from China and Europe, have made India an increasingly attractive destination for global manufacturers.

This will provide substantial benefits to LATL, allowing us to seize the growing global demand for high-quality automotive components. Our strong market presence, robust technological backbone, investing in sustainable practices, strategic locations near key automotive markets, and comprehensive portfolio positions us well to leverage these growth opportunities and enhance our market leadership.

Additionally, our business model is robust, with healthy margins of more than 14% and strong operating leverage, positioning us for sustained success and growth.

Our joint ventures have consistently demonstrated exceptional growth, significantly enhancing our overall performance. These partnerships have not only fortified our market position but also allowed us to broaden our technological capabilities and product offerings. We are particularly enthusiastic about the potential of these joint ventures to drive our future growth. As they gain momentum, we anticipate they will play a vital role in bolstering our market presence and expanding our reach.

These collaborations are well-equipped with the resources and expertise necessary to seize emerging opportunities within the automotive industry. Furthermore, our strategic emphasis on joint ventures enables us to harness synergies and optimize operations, thereby enhancing our competitive advantage.

We are excited to share that Lumax Cornaglia Auto Technologies Private Limited (LCAT), our joint venture with Cornaglia S.p.A., Italy, inaugurated a new state-of-the-art manufacturing facility in Chakan, Pune. This plant is equipped with a cutting- edge R&D lab and serves as a comprehensive solution for vehicle emission products across all segments. In line with our commitment to innovation, the facility features advanced European precision machines and will produce a diverse range of products, including Air Intake Systems, 3D Blow-Molded Ducts, and Urea Tanks. This plant for the first time is also manufacturing Plastic Fuel Tanks for commercial vehicles.

This integration has enabled us to expand our offerings to include Advanced Plastics, Structure and Control systems, and Mechatronics, positioning us to address our customer's evolving needs with increased efficiency and innovation.

The Aftermarket boasts of 8 products categories and continuously aim to enter growing categories offering a large basket of products solutions to the consumer.

With a network of over 575 channel partners and approximately 30,000 retail touch points, the aftermarket segment is targeted to become one of the top player's in Indian automotive industry.

FY 2023-24 has been the most successful year for us, marked by record-breaking achievements in both revenues and profitability. With a robust foundation and a forward-looking approach, we are well-positioned to sustain and build upon this momentum in the coming years.

The consolidated revenue for FY 2023-24 stood at Rs. 2,822 Crore, marking a 53% increase over FY 2022-23. This significant growth reflects our robust business strategies and our ability to capitalize on market opportunities.

During FY 2023-24, our EBITDA reached an all-time high of Rs. 413 Crore, with margins of 14.6%, registering a remarkable improvement compared to an EBITDA of Rs.224 Crore with margins of 12.1% in the previous year. Our PAT before non-controlling interest grew by 50% year- on-year (Y-o-Y), reaching Rs. 167 Crore in FY 2023-24 with a margin of 6%.

During FY 2023-24, our capital expenditure (capex) was Rs. 111 Crore, including Rs. 33 Crore allocated to leasehold assets. Therefore, the actual capex amounted to Rs. 78 Crore. We are also in a strong liquidity position with a healthy free cash reserve of Rs. 396 Crore, providing us with the financial flexibility to invest in future growth opportunities. With the successful acquisition of IAC, we are confident and well-equipped to pursue further acquisitions and business expansions

At LATL, environmental stewardship is ingrained as a core value. We have proactively implemented comprehensive Environment Management Systems (EMS) to systematically manage and mitigate our environmental footprint. Our commitment extends beyond environmental stewardship to encompass

We extend our heartfelt gratitude to our dedicated workforce whose commitment and hard work have been instrumental in our success. To our shareholders, we deeply appreciate your continued support and confidence in our vision.

Our commitment remains steadfast in driving sustainable growth and delivering superior value to all our stakeholders. Together, we look forward to navigating future opportunities and challenges, guided by our shared goals of innovation, excellence, and responsible corporate citizenship.

Warm regards, robust initiatives aimed at fostering sustainable development and social well-being. LATL actively supports the achievement of the United Nations' Sustainable Development Goals (UN SDGs), particularly SDG 3 (Good Health), SDG 4 (Quality Education) and SDG 5 (Gender Equality). Central to our CSR strategy is a focus on transforming lives within communities surrounding our plant locations through Quality education and Good Health interventions. We prioritize initiatives that provide education, impart life skills, and improve health outcomes, thereby promoting a better and healthier life for children, youth, and the elderly. By investing in education, we empower individuals with the knowledge and skills needed to thrive in a rapidly evolving world. Additionally, our efforts towards gender equality aim to create inclusive opportunities that empower women and ensure their active participation in at workplace.

Looking ahead, we are optimistic about the growth prospects for the upcoming fiscal year and beyond. Our strategic focus remains on carefully monitoring the order book, and we expect margins to improve.

With a particular emphasis on electronics and mechatronics, we aim to position ourselves at the forefront of these technological advancements. This focus will not only diversify our product offerings but also cater to the growing demand for innovative and sustainable automotive solutions.

In addition, the acquisition of IAC has instilled the confidence needed to pursue further acquisitions, enabling us to increase our market share and drive revenue growth.

Chairman

Managing Director

Director