Automotive Axles Limited said it will add capacity beginning in the first quarter of FY27, with full expansion expected by the third quarter of FY27, aligning with an industry outlook of around 500,000 medium and heavy commercial vehicle (M&HCV) units. The company said current capacity utilisation stands at around 80 percent, providing near-term flexibility to meet demand.
“We are investing it and starting from Q1 FY ’27 and by Q3 FY ’27, we would have added all the capacities that is required for the outlook of somewhere around 500,000 M&HCV segment,” said Nagaraja Gargeshwari, President and Whole Time Director.
The expansion follows a quarter in which the company reported revenue of INR 5,620 million for Q3 FY26. Including other income, total income stood at INR 5,709 million. Earnings before interest, tax, depreciation and amortisation (EBITDA) were INR 725 million, representing a margin of 12.9 percent. Profit before tax was INR 512 million, while profit after tax was INR 388 million.
Management said new product introductions are contributing to volume momentum. The MS185 axle has begun gaining traction in the higher tonnage tractor-trailer segment. “Our new product, what we have introduced, MS185, that volume is getting traction,” Gargeshwari said.
In addition to MS185, the company has introduced a 394 brake system that entered production at the end of December and a new-generation tipper axle that is moving into pilot production this quarter. Kishan Kumar, Whole-Time Director at Meritor HVS India Limited, said, “The second product is — it’s for the tipper market, which is where our strength is. And this is also going into production this quarter.”
The company is also evaluating the impact of a regulatory mandate requiring 9-plus metre city buses to adopt low-floor architecture from October 2026. “We are really evaluating this, what does it mean to the new product that we are — we have in the pipeline,” Kumar said.
Industry volumes in Q4 are expected to be 5 to 10 percent higher year-on-year. “The momentum is going forward. So we are expecting it to be better than last year, at least by 5% to 10%,” Kumar said.
Export revenue, which typically ranges between 15 percent and 25 percent of total revenue, has declined in the range of 5 percent to 15 percent, moderating overall growth relative to domestic M&HCV trends.
The quarter included an exceptional item of approximately INR 119 million related to the implementation of a new wage code. “The new wage code came into effect on 21st November. So we assess the impact based on the new wage definition and basis our feedback from our SAT auditor, so we have taken the impact of about INR119 million,” said Raman K., Interim Chief Financial Officer.
Automotive Axles Limited manufactures axles and brake systems for commercial vehicles, serving domestic M&HCV original equipment manufacturers and export markets, with additional presence in defence and off-highway segments.
