Note: This is a preliminary transcript and may contain inaccuracies. It will be updated with a final, fully-reviewed version soon.
Jtekt India Ltd (NSE: JTEKTINDIA) Q4 2026 Earnings Call dated May. 20, 2026
Corporate Participants:
Rajiv Chanana — Director
Yusuke Fujiwara — Director
Analysts:
Tushar — Analyst
Aman Vora — Analyst
Madan Palladia — Analyst
Kevin Gandhi — Analyst
Presentation:
Operator
Ladies and gentlemen, good day and welcome to the Q4FY 202526 earnings conference call of Jtech India Limited. As a reminder, all participant lines will be in the listen only mode. There will be an opportunity for you to ask questions after the presentation concludes. Should you need any assistance during this conference, please signal for an operator by pressing STAR and then zero on your touchstone telephones. Please note that this conference is being recorded. I now hand the conference over to Mr.
Rajiv Chanana, Director, Jtech India Ltd. Thank you. And over to you sir.
Rajiv Chanana — Director
Good afternoon ladies and gentlemen. Let me introduce the team here from Jtech India site. We have with us Mr. Yusuke Fujiwara Sen. He is a full time Director. We have Mr. Daminje Rao. He is a technical advisor and part of the MD office. Mr. Ashish Singh is Divisional Head Strategic Division. He is responsible for sales and marketing as well. He is chief Financial officer of the company and I am Rajiv Chana, full time director. I will hand over the call to Mr. Fujiwara Sen for the opening requirements.
Thank you.
Yusuke Fujiwara — Director
Good afternoon everyone and welcome to the JITECT India Limited Annual earnings call. My name is Joske Fujwala, full time Director of the JITECT India Limited. I would like to thank all participants for joining this call and the organizers for the FY2526 passenger vehicle segment achieved sales of 5.54 million units compared to 5.07 million units sold in FY2425 thereby achieving annual growth of 9%. This was an unexpected achievement particularly considering the fact that during the first half of the year the passenger vehicle segment registered a growth of only 1.6%.
In September 25, the Indian government announced a major indirect taxation in reform which lowered the GST rate from 28% to 18% for smaller vehicles and from 50% to 40% for larger ones. This change improved vehicle affordability particularly for the small size segment. In the second half of FY2526, the passenger vehicle segment registered a growth of 16.7% which was quite significant. Now I’d like to discuss with you the company’s financial result. During the financial year 2526, Jitect achieved a sales growth of 11% compared to passenger vehicle market growth of 9%.
The growth in sales at Jtech was supported by SOP of EBITataras and Victoris by Maruti Suzuki where we are supplying demand for the certain vehicle like Auto mcgear, CEPS and cvj. Due to reduction in JGST rate, there was increase in demand for the certain vehicle like Arto, Jimny, Bareno, Etiga and Briza where jtech is supplying components to Maruti Suzuki. Okay. Further, our sales to Mahindra, Mahindra and Tata also increased by 17% with the improvement of sales. The EBITDA margin for the second half to a level of 8.48% compared to 7.71% achieved last year.
Despite this improvement, we are shot by 0.1% as the full year margin declined from 7.60% last year to 7.5% in the current FY25 26. Jtech continues to exercise strict control of fixed costs. In the category of the employee cost and administration cost, we achieved a saving of 0.28% as percentage of sales. Variable cost was higher by 0.38% mainly due to product mix increase, the rate of state electricity, power and reciprocal tariffs paid on export to the U.S. As we conclude, I wish to convey my deepest gratitude to our shareholders.
Your trust and support have been instrumental in making our maiden Lights issue during the year a great success. Our promoters JDEX Corporation Japan and Maruki Suzuki participated fully in the light issue and the participation from our public shareholder was overwhelming. With appreciations exceeding twice the number of the chair offered. With this, I’d like to thank you for your participation and open the conference for questions. Thank you.
Questions and Answers:
Operator
Thank you very much, sir. Ladies and gentlemen, we will now begin with a question and answer session. Anyone who wishes to ask a question may enter STAR followed by one on the Touchstone telephones. If you wish to withdraw yourself from the question queue, you may enter STAR and two participants are requested to please use only handsets while asking a question. We will wait for a moment while the question queue assembles. The first question is from the line of Tushar from Peace Wealth. Please go ahead.
Tushar
Yeah. Hi. Thank you for the opportunity. Sir. My first question is regarding the gross margins. We see the gross margins from last two years. They have been continuously declining from 29 to 27%. Now can you just highlight what are the key factors behind this and how should we see the gross margin from here on? That is my first question.
Rajiv Chanana
Sure. Prashant, thank you for attending this conference call and asking the question on margins. Yeah, we are equally concerned about that. So let me take little time to explain the change point which has happened over the last two years. I will not be restricting myself to the current year. I will try to correlate it with a year before that also. So you are aware that 202526 it started with a weak note. You know we saw passenger vehicle market growth just 1.6% in the first half. Now this is lower than expected sales and EBITDA margins for the first half of 25:26 declined to 6.3% compared to 7.6% which we achieved first half of the previous year.
So as the sales improved due to reduction in gst rates in September 2026, the margins also started improving and the second half was 8.48 compared to 7.71. Despite this improvement like we touching 8.48%. Still when we look at the full year margins, they were down by 0.1% from 7.5% previous year to 7.6% in 2546. Now let me start my explanation with analysis of the fixed cost. Jtech, you know we always mention continues to exercise strict control on fixed cost. Employee cost as a percentage of sales declined by 0.18%, almost 0.2% compared to last year.
Similarly, admin cost as a percentage of sales declined by 0.1%. This reduction in admin cost was particularly important for me to mention because during the year we had a rights issue and the rights issue expenses were also booked which was about a good amount of 8.2 million. This explained management focus on exercising strict control on cost which are controllable and at our end and thus fixed cost reduced by 0.28% as a percentage of sales. Now coming to variable cost there was an increase compared to reduction of 0.2% into 8% in fixed cost.
0.38% was increase in the variable cost and this include as you said margins. Material cost was up by 0.18%, manufacturing 0.1 and selling 0.1 and that altogether this resulted into reduction in our ebitda margin by 0.1%. So let me explain the change point in the variable cost segment. Material cost as I said was high by 0.18%. So there was a mix of positive and negative factors which resulted into the net change of 0.18%. So let me explain the positive factors. First the positive impact was as high as 0.38% and this was due to improvement in our business condition which impacted us very badly in the previous financial year which I’m talking about 2425 where the margin felt very very in a very high manner about 1.4% was declining our margins when we compared last year 2425 vis a visa previous year.
So one major improvement point was increase in exports during 2526 we were able to increase our export sales by 20% from 551 million to 664 million. And this improved our margin by 0.15%. However, when we compare these export sales with 2324 which I am trying to compare two years back, two years back our exports were 867 billion. So we are still below our benchmark level of 867 million by as high as 22%. And this is still impacting our profitability during 2526. We expect this should improve in future.
So now further, there were some other factors which were positive like which impacted us in 2324, like in World trade cost. You recall we mentioned about the Red Sea issue. There were a lot of testing happening because we were moving into several vehicles like Evitara Victoria and one more MPV which is now under launch. So we were doing a lot of testing jobs for new product development and the new lines were being installed. So we had two manual gear line installed at our two facilities, CPS line, CVG line.
So all these lines were getting established. So the testing charges are very, very high. And then the settlement of provisions, you know, which we mentioned last year. So these improvements gave us during 2526 compared to the previous year, we improved by 0.23%. So overall there was an improvement in margins by 0.38%. Now coming to the negative factor about which impacting our profitability. Sorry, the positive was 0.23%. Now coming to the negative factors. You know, these negative factors was about 0.56%.
There were two major reasons for these negative factors which we faced during 25:26. The first reason was change in the product mix due to major decline in sales to Honda which was about 33%. Sale to Renault Nissan for the export models which was about 16% and a small decline in Toyota also by about 4%. Now the profit margins for these customers are better for the sales which we do to them. On the other hand, we saw a lot of change in the business mix where sale of steering systems to Maruti, Suzuki Forecast like Alto, Jimny, Baleno, Altiga and Briza that increased primarily because of the GST cuts which gave them a positive impact.
Margins in these models are slightly lower. When we compare with Honda, Toyota, Renault, Nissan for export models I think the margins are slightly lower. And and this change in mix costed about 88 million which is approximately 0.33% impact on the margins. Now we expect that the Honda sales in the future Years will improve. We are waiting for the launch of another vehicle which is an SUV EV by Honda which will be launched from their Tapu Kera plant during maybe around December 26th. Now, just to reconfirm, you know, I think the point which is relevant for you to note is that the raw material price settlements with customers are back to back, albeit with some time gap.
So thus reduction in gross margins happen only when we have a product mix which is negative for us or when there are some other factors like inward fade changes or there is an increase in the new product development cost. You know, the new product development cost is taken as part of the material cost as per the accounting norms. We do not, we add, just simply add it into the manufacturer to the material cost. So this is one major reason which impacting our profitability during 2526. The second reason which is more of an accounting issue.
If you look at my financial results which we have published, you will notice there was a big foreign exchange gain of about 26 million or so, 62 million or so. This when we realized this positive foreign exchange at the time of payment to our overseas suppliers. So you know, when the effective payment for our imports were actually lower compared to the liability that we booked at the time of purchases. So what happens is that when you record the liability for import, you record it at a certain forex rate and when you make the payment you pay at the actual rate.
In fact, the material cost should be booked at the actual forex rate. Unfortunately, that’s not the accounting practice which we have to follow. We need to record any forex gain on purchases as other income. So therefore imports were booked at a slightly higher price which costed about 62 million 0.23%. So 0.23% of forex and point which is and 0.333% of product mix. These two together costed 0.56 as a negative factor which offset our improvement of 0.38% which we achieved compared to the previous year.
And therefore there were net negative impact was 0.18%. Now these factors both are factors which I’ve just mentioned are looks in my opinion are temporary and we should not be getting hit by the same kind of a drastic product mix change next year or we will not get any forex even though it was an income getting added into income, but will not have this kind of an accounting issue in future. So considering that these are the temporary factors now coming to. Just to explain a little bit on the other category of variable cost, manufacturing cost was higher by 0.1%.
This was mainly because of the power tariff change during the year. And then you know another major factor was that increasing power utilization for the new production lines which are under trial and implementation. Again this is one time factor. So once our lines are ready, we don’t have to incur additional power cost in trial and implementation of these lines. Coming to this was an impact of 0.1%. So coming to last impact which is selling cost again 0.1% impact. And this was mainly so again there was a positive and a negative factor.
The positive factor was that we had a positive warranty cost change. The warranty cost was down just to sell. Just to inform you again we had a recall situation in the earlier year. This year the warranty was much under control. So warranty cost was almost down to half. And that gave us a positive of 0.15%. However, you are aware about the US tariff. You know the reciprocal tariff and penalty tariff which US imposed on our importance on our exports that costed us about 63 million which was 0.24%.
So together positive 0.15% and negative 0.24%. There was a net negative of 0.1%. Again this is one time tax curve. You are aware that the order of Supreme Court this tariff has been now withdrawn in US So futuristic little bit. We expect some improvements in business situations. Number one is that reduction in US tariff from 50% to 10%. We expect UX exports will increase and further these export will be at a lower tariff and thus will help improve profits as well. Second, we expect sale of new models of Maruti Suzuki where Gin has started supplying during 2526 will increase.
Martha Suzuki is expected to launch another MPV which is EV from Gujarat plant expected in October 26th. And we expect that this will help us to increase our revenue and improve margins again for this model we are supplying all complete steering Ms. Gears, EPS as well as cbj. Cost of testing as I just told you will reduce in future and this will help us because Most of the SOPs will not start export to Brazil will start. We told we informed in our previous meeting is that we got a net purchase order from Brazil and this I’m happy to announce that we will be starting this batch from this month.
From May month we’ll be starting dispatch and this volume will continue to grow up to maybe 5 lakh unit. We expect this will grow. And lastly our efforts to continue to maintain fixed cost under control. So these are the various things where management will be working to Continuously improve the margins in future years. I hope I have been able to answer your question.
Tushar
That was very helpful, very detailed. Thank you for that. Really appreciate it. Sir.
Rajiv Chanana
If
Tushar
I can go to my next question. Sir, my. My next question is regarding the Toyota plant. So as we know they were putting up a third line in Badili and that was to be commenced this year itself. And from what I have been reading in the public articles is that this has already commenced. Can you just confirm this if that has commenced and if yes then how should we see the revenue mix from Toyota for us which has been traditionally about 12%. Can this go to 15, 16% in the near term?
Rajiv Chanana
Sure. So let me tell you about the breakup of our sales. So Toyota was 12% last year and was 10% this year. And one of the reason why Toyota Slightly declined by 2% because Martha Suzuki went up from 56% to 60%. Others were more or less same. Honda declined from 8% to 5%. Mahindra and Mahindra and Tata remained together at 10% level. So and exports slightly improved from 2% to 3%. So this was a somewhat breakup of our sales to different customer. Coming to your question about Toyota. Toyota is you are aware is that part of the group of Jtech they hold about 20% equity in Jtech Corporation Japan.
And Jtech Corporation Japan is the largest promoter of Jtech India Limited so we are connected with them. So in India we are involved with most of the developments like for example like all the current manufacturing is happening using our steering systems. And one of the reason our moving to western reason was is to. You know, because we are aware that Toyota possibly will be setting up new facilities in Maharashtra. We are hoping that these facilities set up as early as possible because we will be ready for that.
And that was the main reason for our setting up a plant in Gujarat primarily to support Suzuki which already has plant and they are expanding in Gujarat and we will we expect Toyota to expand in Maharashtra. But these are all new things. We do not have the exact information at this point of time and normally we will not even if this happen, if this will happen sometime in 28 and 29 in our understanding the about the Toyota thing which you are saying will happen some sometime in 28 and 29 as per
Tushar
Plant which is their existing plant where they were putting third line with an investment of 3300cr where they were increasing the capacity by another 1 lakh. I think that has already commenced,
Rajiv Chanana
Right? No, no, that has not already commenced. The new facility in our understanding is that to begin in 1H29 which will increase their capacity to about 1 lakh vehicles per year. This is our understanding.
Tushar
Yes, that is for Maharashtra. But for Badiri where their existing plant is housed. There also they expanded that capacity by 1 lakh. It’s okay sir. I’ll maybe check on that later on with you.
Rajiv Chanana
The most important thing is that we are attached with Toyota for all their steering requirements. And you are aware that we are supplying for hydride or etc. For CVJ also. We are already supplying to them. So we are the only supplier at this point of time for them. And we hope that will continue to be the only supplier for Toyota in future as well.
Tushar
Yes, just a follow up question on that. Since now Toyota is also putting up a plant in Maharashtra. They’ve officially announced this. So on the driveline segment of jtech Corp. As I understand there are multiple products that are there and not just CBJ or hub unit bearing that we do. Hub is something that we will do. But other than that also there’s a whole catalog of different items like drive shaft, drive plates and there is this LSD IT and flex plates. So is there any plan for jtech Corp. To you know give these products also under jtech India on the line?
Do we have any intent of doing that other than CBJ or hub unit bearings?
Rajiv Chanana
So you know this. These new products like for example when we introduce CBJ constant velocity joints into the Indian market. This was actually a step towards company aspiration to increase product portfolio. You’re rightly so. And we always wanted to gain the share of important driveline segment of auto components. So while steering we have the complete assembly, complete system supplier. But we are not a system supplier when it comes to driveline products. So our aspiration is to keep increasing our capacity in this particular segment and keep introducing more projects.
However, you know, it takes time. You know, we need to see that we first reach to a certain level of growth in CBJ. We told in the last meeting is that our first level target is to touch about 15% market of CVJ. So just to give you little bit more information on cvj. So during the current financial year, you know we. The second CVJ line came into operation from November 25. And this has increased our production capacity by 7.54 lakh units per annum which is equal to 3.8 lakh vehicles. Because CVJ is supplied in sets and 25, 26.
The total sale was about 1300 million only. That was just about 67 or 65% of the total capacity utilization. So what’s happening is that the third vehicle of Maruti Suzuki which will be launched now and we will start supplying and we expect that the capacity utilization for that will increase to 90% and this sale will touch about say 250 crores or more than that. Currently we are only supplying for Grand Vitara and Toyota Highrider. And then in August 25th you are aware that we started supplying for Evitara and Victoris which Marty Suzuki introduced.
And so you know, so idea is that we need to capture the market of which is a huge market and can be bigger than a Ms. Gear market which we are currently serving in the steering category. We are competition is there NTN and other people are already there. They already have more than GKN got more than 60% of the multi business. So we need to enter that area. There’s a huge competition and we are targeting that business to reach to a level of at least 15% to begin with. The third line we will be will start working now.
So CVJ third line will give us about a production capacity which can help us to touch about 15% market share. And then when we move to Gujarat we will expand further in the, in the CVJ category. So this is one area where we have just introduced and we are still working very hard because there are various versions and various specifications which we need to cater over long bigger vehicle and a smaller vehicle. We call it a long stem technology. So many, many things we have to do in this particular area.
So give us some time. I think you will be the first person to know whenever we plan a similar activity in future. Yeah, we have inside a few things but nothing at this point of time which has crystallized because we need to do a lot of work on CVJ first and maybe then move to another, another segment.
Tushar
Okay, my last question sir now is about this JTAG Brazil order that we got was the first of its kind from jtech Group. Do we, are we in discussion with other jtech entities also do we have a plan in future to cater to other jtech entities?
Rajiv Chanana
Yeah. So if you recall during its presentation to investors while announcing its financial results for 2425 Jtech Corporation Japan they expressed its intention about strengthening Indian sites by promoting India as a global site. You know this was not just a statement because when jtech Corporation Japan is informing something to the investor they have a lot of weight behind it. And we expect that to strengthen our operations to meet the expectation of our group entities. So this, this activity of Brazil will Now start and we expect that about 70,000 units will be supplied during the current year.
The first shipment will happen this year, this month itself, May we will start supplying to them. And this business can be huge. We already set up, as we informed you, we already set up a line, manual gear line, reconfinnial line at our Chennai unit with an installed capacity of approximately 4 lakh units. And this will. This business will go very fast as per our understanding. Because there will be many, many variants which will be launched by Stellantis in Brazil on the same platform. And we have few details that this business can rise up to 5 lakh units per annum.
And one, once we are able to establish ourselves with the group entities by performing well, supplying on time, supplying the best quality products at the right cost. Once we are able to establish ourselves, I think there will be more business waiting for us. We just have to be little patient, keep working hard and then see that the next order will come.
Tushar
That’s great. Very heartening to know sir. Thank you so much. Before I wrap up sir, are we supplying to Dustar also? Are we supplying for Dustar also or not?
Rajiv Chanana
No, we are not supplying to Dust. Most of the model which you are supplying to Renault, Nissan is on the export models, Sunny and all those models, that’s where we are mostly.
Tushar
Okay, thank you. Thank you so much sir. And all the best.
Rajiv Chanana
Thank you Tushar. Thank you so much.
Operator
Thank you. The next question is from the line of Aman Vora from Premier Capital. Please go ahead.
Aman Vora
Hello.
Rajiv Chanana
Yes, I’m
Aman Vora
Audible. Yeah, hi. Yeah, first of all many congratulations on a strong fourth quarter performance. I actually just wanted to get some understanding from you on our revenue trajectory. So in the previous quarter you had explained that by F27 we would look to add about 1000 crore to top line. Because of these all the new capacities that we have commissioned in the last six to nine months. So given. So could you just update us on that? Where are we on that guidance? And also given all the initiatives around the new capacities from all our clients, the opportunity of export to the promoter group as well as the CBJ ramp up, can we look to double our revenue in the next three to four years?
Rajiv Chanana
So let me explain you, where are we now? Future, I will leave it for you to decide. So I will explain you where we are. So let me start with 25, 26 that just completed financial year. So Jtech India as Poojiwara Sen in his opening remarks mentioned that we touched a growth level of 11% compared to the passenger vehicle market segment growth of 9%. So we performed better than the market. So now out of this 9%, when we look at the overall passenger vehicle market growth of 2526, the share of market Suzuki and Toyota was 5%.
So when we say that the passenger market vehicle grew by 10% market Suzuki and Toyota grew by 5%. Now these taxation reforms you are aware about, GST reduction, etc. Etc. This actually sparked optimism and we saw a significant increase in demand for several models of Martha Suzuki where we are present like Alto, Jimny Baleno, Altiga, Breza. Because of our presence in these models during the last two quarters, we were able to get a huge business from these. And therefore, as I told during my previous answering the previous question that our share with Maruti increased from 56% to 60%.
Again the new business of Maruti Suzuki Vitara Victoris, they gave us an additional sale of 173 crores. 174 crores. Because we are supplying almost every product. Like we are supplying manual gear, we are supplying CPS and we are supplying constant velocity CVJ joints also. Still this was not good enough, you know, because there was a huge delay in the SOP of these models. We expected these models to start from June and then they finally started from August and then mainly for export models. And then launch in Indian market was further delayed till possibly October, November.
So what we expected for these models, we did not achieve that. But still despite that, just few months and then we touched about 200 crore kind of a sale turnover from these two models. And now we are waiting for the third model which Marcus Suzuki will be launching. This is a MPV EV from Gujarat and we are again a complete supplier for all the three products. Manual gear, CPS and constant velocity drain. So we expect that this can give us good business. Now coming to the negative points, you know, we had a negative growth of approximately.
If you look at the impact on the market side first that gave a 1% negative growth, you know, to the market like Honda and Nissan, these people. So when we look at Honda standalone, their business in the passenger vehicle segment declined by a massive 30%. And we are, you know, we are almost 100% supplier to Honda and this negative growth impacting our overall sales. However, and that that was a major reason. Otherwise our sales could have been even maybe we could have touched 12 to 13% compared to 11% which we actually touched.
Now again for the Honda we are optimistic is that once they will be coming up with their new SUV which is an EV and we expect that they will be able to capture part of the market which their people have lost. This business is expected to be around. On the optimistic side about 40,000 numbers which Honda is planning and this can be 100 crore business for us. If everything materializes good, this can be a good business for us. Now coming to CVJ as I said we’ve been supplying to Vitara Toyota Highrider.
We will not we started supplying to. Sorry we were supplying to Grand Vitara and Toyota High Rider. We will not start supplying to Evitara in Victoria. And this you know sale which is about 130 crore this year will touch about 250 crores on a full two line capacity which we are very hopeful that once the MTV EV or Maruti Suzuki will be launched in October 26th we will touch 90% capacity utilization of over two CVJ lines. And we are now working on the third line. We already started working on the third line now coming to Brazil.
This is a start and small 70,000 and we will start touching about next year. We will touch about may say 1 lakh to 1 50,000 which can be about 50, 60 crore kind of a business. And then it can touch 5 lakh units over a period of time. So this is something the direction of export like you know one thing is that we are getting business where we are now supplying. Not only steering, we are supplying driveline products as well. Our export will continuously increase. We expect US exports to improve. We expect export to Brazil to improve.
We expect Honda business to come back to some reasonable levels. They have lost a lot of market share. I think they should come back and the product mix will be positive. Now if you have seen the presentation which we filed on stock exchange yesterday, you know we have put a our new capacities which we have set up and we mentioned about the capacity utilization in 2526. So if you look at CVG Line 2 which was set up in November 25th with a capacity of around 3 70,000 this is just 27% utilized today.
CVJ Line 1 which was installed previous year is about 83%. Ms. Gear Line 5 Daru Hera which we installed last year is already touched 106% capacity utilization. However the new 6th line Ms. Gear line is just 21% utilized at this point of time. Similarly MSGL line 4 which we have set up at Chennai for export business is the SOP has yet to start so practically not utilized. Similarly CPS line 4 line 3 at Bawel is about 50% utilized. So when you look at the capacity which we have already created in the last one year over 25, 26.
Because the most of the models like Vitara and Evitara and Victoria started in between the financial year. Therefore these lines could not be fully utilized. So over a period of 2526, the utilization, for example the CPS line was just 50%. But now with the new models coming in and now for the full one year production of EBITDA and Victorious these production capacities will be fully utilized. So we expect that whatever capacity we have set up will be 100% utilized over the next one year or maybe one and a half year depending upon the market.
So I have given you all the data which I already have. What I’m trying to tell you is that we are the market growth. You know, at the end of the day, if the market grow, we will grow better than the market. And that’s what we have demonstrated over the last three years. So let’s see, you know, if your projections about the market are 20%, I can assure you that we’ll also grow by 20%. But let’s wait for the market to shape up in the next three, four months. I think we’ll have a better picture emerging.
And you can link my growth with the market growth very easily. Because I have production capacities which are not fully utilized. We have already created committed for additional production capacities. And we are all ready now to capture any new share of business, you know, which will we will get from our customers.
Aman Vora
Yeah. No sir. So when you mentioned that over the next 12 months we will move to full capacity utilization on these new capacities that are added. How much revenue can we get on full utilization from the current capacity? Let’s like, it’s difficult to pinpoint 12 months or 18 months. But once this current capacity is fully utilized, how much revenue would be able to get? Would it be thousand crore of incremental revenue? 800 crores? 1200 crores. Already got 300
Rajiv Chanana
Crore increase this year. So from 2300 crore to 2600 crore, 300 crore we already got in this year. Export will be additional. Suppose whatever market growth next year, say you know, let’s talk theoretical. Let’s not talk. You know what my numbers will get me? I give you a different way of calculating my growth is that suppose the market grow by 20 by 10%. Okay. So we will be able to grow by 400 crores. And if we are able to grow our export by say 100 crores, we can get another 500 crores. We got 300 crore this year.
500 crore next year. So we will be touching about 800 crore additional. You are seeing 1000 crores. I’m saying conservative. 800 crores.
Aman Vora
Got it. Sir, I will not be
Rajiv Chanana
Able to share my next year business plan. I’m sorry for that. We don’t share that.
Aman Vora
I can give you
Rajiv Chanana
Some way of calculating it. Yeah,
Aman Vora
Yeah. So if you see your financials, our return on Capital employed was 16% in F24 which is now down to 10%. This is because we’ve done about 800 odd crores of capex in the last three years. At the same time my fixed asset, our fixed asset turnover is down from 4 plus to about 2.2. So we have added significant capacity in the last three years. Now if we have to improve our ROCs which is the mode of adding these capacities or get back to where we were originally, we have to have a revenue ramp up and as well as improve margins.
So that is where I’m coming from. How we see this ROCE trajectory moving back to our historic levels of F24 where we were doing 16, 17% which will be a factor of revenue growth as well as margin improvement. That is where I’m coming from. Not a specific guidance for next 12 months, maybe for next three years the trajectory.
Rajiv Chanana
So we are 100% aligned with what you are saying. We have exactly the same thinking which you have. We have a capacity and we need to utilize that. And I think as I said, we expect that our capacity will be 100% utilized within a year and a half. That’s what our understanding is based on the new orders which we have. So just coming to your return on capital employed thing, you know, maybe you do not have the balance sheet with you at this point of time. It will be published in the next few days time.
Our CWIP which is the assets which are not yet operationalized is about 411 crores. So if I simply remove it, you know, because these assets are at this point of time not generating any revenue. So if I remove that the return on capital employed improves to more than 11% from whatever number you just told. So that, that’s where we are is that you know. But then yeah, once the full capacity utilization is achieved, this, this, this return will further improve because the profit will improve. New numerator, numerator will improve.
Denominator will remain the same. So this is again touch back to the same numbers as we touched about two years, three years back.
Aman Vora
Just last question from me sir. CWIP
Rajiv Chanana
Is a major thing which you must keep in mind. So you are in an analysis. So I would always request you that whenever you read my balance sheet please continuously read the CWP where that will continue to impact my ratios for the next maybe one year or two years. Yeah
Aman Vora
Right. Got it sir. So just last question from me. So this year we’ve done close like a 400 crore plus capex. What would be our guided or like expected capex for F27. We’ve seen a slight increase in debt also. So any, any, any guidance on the capex for F27.
Rajiv Chanana
So definitely because most of the expenditure on line setup has already been completed. The one activity which is currently going on is the setup of our Gujarat location plant where again we have already we have committed about 250 crores for that particular unit. And we have already spent about 112 hours above from the rights issue and maybe some money from our own pocket. So maybe 130 we have already spent. So overall capex for that particular location is about 250 crores. So maybe another hundred crores for that location and then other normal capital expenditure it will not be as huge as we have done in the last two years.
But yeah Gujarat is one location where we need to spend some money going forward over the next one or two years.
Aman Vora
Perfect. Thanks a lot sir. Thank you for my. Thank you for the opportunity.
Operator
Thank you. The next question is from the line of Madan Palladia from MKP Securities. Please go ahead.
Madan Palladia
Hi sir. Thanks for the opportunity. I have two questions for you. One on again following up from what the previous participants were saying if on the driveline side you could give us some more color on what other products are in the near term launch pipeline. Secondly how our margins or when you say fix the set turnover, how does that differ? And as to the 750 crores of capex that you’ve done I understand that your previous assets were well depreciated. So I just want to understand what sort of fato you can look forward to going from here when you make new investments as well.
Rajiv Chanana
Okay, good. So I think on the other driveline product which was your first question. I think we have already explained our CVGS strategy. Our aspiration to touch market share of 15% and maybe you know long term will include our, you know further increasing this capacity. So from Gujarat location. So currently at our existing Dharwara location we already have two production lines with a capacity of around 7.54 lakh units which translate to about 250 crores kind of a volumes of value, sales value and we will be up about 90% capacity utilized.
When we will be will get the third EV model of Maruti Suzuki which will happen sometime in October, say October 26th. So this is where we are for our existing. There are the four models where we are supplying. As I said, Grand Vitara 20, Toyota High Rider, EBITDA line, Victorious and then on the fifth model will be added and we are up and running. You know the next challenge will be that moving to other customers. Once we are able to establish ourselves with Martha Suzuki and Toyota, the next challenge will be to move to other customers and establish our product with them.
So this can be huge business. This is a driveline business and can be huge business which can be equal to or more than the manual gear business which we currently have. You know we have more than 40, 45%, 40 45% share of the manual gear business and we can continuously would like to increase the CBJ business also in the same direction coming to other product. You know we will not be able to inform at this point of time because there is no concrete plan which has already been finalized along with jtech.
This will happen but not immediately. We will, it will take time because we first need to stabilize our in the CVJ market which is a huge market and we know that there are opportunities also to supply overseas also those certain parts of CVJ, the surgeon force part etc. There is a big opportunity that we can supply. We can export to our group entities also. So this is a big strategy which we have and we will keep on reporting back to you as and when we take more actions on that. It was a year out, year and a half to concrete our strategy on CV side.
Maybe then will be the right time to move to the next strategy. Maybe introducing another product in Indian market. This is one thing. So coming to your next question about investments which we have done. So I think if you have seen the. If I would request you to see the presentation which we submitted to Stock Exchange yesterday which talks about all the capacities which we have built. So when you look at the target ratio, you know, for example, if I just give you an example of cps the fixed asset turnover ratio for CPS can be as high as 2.5 to 3 times.
When it comes to manual gear the the ratio can be say 2.2 to 3, 2 to 2.5 times. CVG can be lower. You know CBJ can be 1.5 times. So it depends on the capital expenditure which is required for setting up that kind of a line. So fixed asset turnover Ratio will be different from product to product. But the target which we always take is three times. So we been doing more than three times in our past and we hope that once these capacities are fully utilized we should touch at reasonable level which should be upward of three times.
So that’s what is our estimations are. But then it will depend on product to product as will be having more CVJ in our product line. The capacity, the fixed asset turnover ratio may be slightly lower side compared to. But that does not mean that the profitability will be low. So these products have good profitability. Just I think we informed last time also is that CVJ is one product where we have a almost 100% localization. It’s all local products. There’s absolutely nothing which is imported at this point of time.
We’ve been able to There was certain part which were being imported earlier but I think we’ve been able to localize all those parts and so this can be a good model for us. As you know that as we’ll be moving towards lower depreciation over the period of few years I think these can be very good profitable products for us. So this is where we are. I hope I have answered your question. If I miss any part of your question, you can repeat it please.
Madan Palladia
So you answered most of my questions. Thank you again. As far as the FATO is concerned, just one clarification I’d like from you. When you say fato, what is the fixed asset number you are taking? Because you have a number that goes into the factory and there is a balance of materials, EPC, etc.
Rajiv Chanana
Everything I consider furniture and fixtures, office equipment, CWIP. I think this is a balance sheet number only. So I ideally I should have removed CWIP because that is not generating any revenue at this point of we don’t do that. So whatever number we have published yesterday is on a gross assets basis covering every asset all
Madan Palladia
Directly. Understood, sir. Thank you. And just on the CBJ margins, if you would tell us how they’re different from the console margins.
Rajiv Chanana
So better than what we get on manual gear. Good thing is that as I said is a 100% localized product. EBITDA margins are better than even most of the Ms. Gear product. We have Ms. Gear, you know, over a period of time there have been huge competition and we feel that CBJ is one product where we can perform where we can have little competitive edge. It’s a very good product which we have seen set up with lot of innovative design and lot of quality parameters we have. I think the testing etc. Took almost 2 years time to develop this product for the Indian conditions.
We are very sure that we will be able. There may be little hiccups. It’s a start for us and we are just maturing in this area. But we are very sure that over a period of time there are a lot of opportunities for backward integration also. For example forging, etc. So many, many opportunities to keep strengthening our supply chain, strengthening our production facilities and performing better than other products which we are supplying. So margins are good,
Madan Palladia
Right? Thank you for answering all my questions.
Rajiv Chanana
Thank you so much.
Operator
Thank you. The next question is from the line of Kevin Gandhi from Cap Grow Capital. Please go ahead.
Kevin Gandhi
Hello. Hello sir. I hope my voice is audible.
Rajiv Chanana
Just one minute. We are almost completed time. So we take it as a last question if you kindly permit. Yeah,
Kevin Gandhi
Yeah, yeah. Thank you sir. I just wanted to understand that sir, how much would be the total sales estimate at total sales potential once the entire capacities are utilized? And just to follow up that like on that question that how much is the business that you are expecting from the Maruti EV guys which is going to get released? So that’s the first question. My second question was that the CWIP of 400 cr. So where would that be used for like how many lines or CVJ and msg. So
Rajiv Chanana
Those
Kevin Gandhi
Are the two questions and I would ask subsequently as a follow up.
Rajiv Chanana
So the sales side. Now I think I’ve already answered that question to my. To the previous. You know we should not. There are two things. One is the capacity data which I already submitted with you. This was part of my presentation which talks about all the new production line which you have set up. So for example at Daru Heral 2 facilities we have set up the 6th manual gear line. So capacity is around 3.5 to 4 lakh per line. You know that that’s the overall capacity which we have for the MSK airline
Kevin Gandhi
CPS.
Rajiv Chanana
We have set up the third line. Now at Bawal capacity is around 5 lakh units per line. You know CBJ we have set up the second line so capacity is around 373 per unit. So these are the three main products. I’ve given you capacity number and based on that you can estimate little bit on the sales side. But now coming to. Coming. Let me repeat the answer which I gave to the previous caller is that this year we were able to achieve a 300 crore extra turnover which was from coming from the new capacity which we set up.
For example the line number five which we set up at Aruheda and CBJ line which you set up at Dharvara. So mainly the production came from that. The sale came from that. Now coming to the next year. What I told the previous caller is that suppose we consider a 10% growth. This capacity which we already set up is good enough to cater to that 10% growth for the next year. Which means here another 400 crore business. If we add to our sales and another maybe 75 to 100 crores of export we can touch about 500 crore additional sales.
Based on our existing setup the production facilities already have at Chennai and at Darwela and Bawal we can cater to approximately 500 crore which means 300 crore of this year and 500 crore of next year. We can touch. We can easily cater about 800 crores of extra business from this. So my answer to the question was that we just need to wait for the market to shape up in the next one or two months. I think we’ll have more clarity as to where are we heading. Currently it looks good. There are good numbers for April and they are good forecast for the month of May in terms of sales by passenger vehicle segment.
And we expect that if the market grows like this this number is achievable. What I told you on a theoretical basis this is one thing. Now coming to your second question about. So we already have Ebitara which was the first model launched by Marcus Suzuki and we got the entire system which means Ms. Gear, CPS and CVJ and the new vehicle which Marcus Suzuki will not be introducing sometime in October which is MPV which is a multi utility vehicle which is again an EV model. We are again there again we will be supplying the complete set like manual gear, CPS, CVJ.
So our line CBG the second line will be 90% utilized. So entire 7 lakh 40 thousand capacity which we have for the first two line will be fully exhausted once we have this new business. So this is where we are. So we are currently supplying to 100% of multi EV business at this point of time. I hope we have answered your question.
Kevin Gandhi
Okay sir, got it. And so just, just, just like one little kind of clarification on the Ms. Gear line 6 that shall be utilized once the Maruti EV car comes, right? If I’m not mistaken. So
Rajiv Chanana
Line now which is set up, you know we. This could cater only for partial of year because this we got the. This Ebitara and Victorious Venus started in between the year it was not for the full year. So the current capacity utilization of this line which is about say 30% will increase to 60% and then, then the new model will be added. So we’ll be touching about 80 to 90% of this line.
Kevin Gandhi
Okay, sir, got it, got it. And sir, my last question was that like what do you see? Like, like what as a company do we see the potential of expanding into the areas of US and Europe Because GTD Corporation, Japan, they are actually making losses there. So there might be potential of us supplying there or exporting there. So what is the strategy which companies actually forecasting for those regions? Because that’s a huge market as compared to India.
Rajiv Chanana
We are moving in that direction. I think India has the capability to cater to the world market. We will be strong starting with Brazil. I think this is a big order which we have got even though we’ll be supplying with say 70,000 units this year and maybe one like 50,000 units next year. But it’s got a huge potential to continue to supply. So Stalentis model and Stalantis will be supplying in Brazil as well as nearby countries. And we expect that this once we are able to establish ourselves as a good quality delivery supplier at a competitive cost, I think then you know, we can expect another order coming up very fast from other.
So let’s wait. You know, we are moving in the right direction. You know, we’ve been waiting for this opportunity from the global entities for almost two, three years and now that has materialized. Now we need to demonstrate that yeah, we are the best suppliers from the world market. I think we are very hopeful for that. And we have the brand new Chennai line ready and people are emotional and people are very, very, you know, ready to take this challenge. And we hope that this will establish ourselves with our overseas.
Overseas other. Other OEMs.
Kevin Gandhi
And sir, just one last thing. Sir, on the.
Rajiv Chanana
We are out of time. You just call me please. I’m sorry. Okay,
Kevin Gandhi
Sir. Okay. I’ll take this offline. Yes, not an issue.
Operator
Thank you
Rajiv Chanana
By 10 minutes.
Operator
Sure. Ladies and gentlemen, that was the last question. I now hand the floor back to the management of jtech Tidya Limited for closing comments.
Yusuke Fujiwara
Okay, again I’d like to thank everyone for joining this call. I hope we have been able to respond to your question adequately. We are really positive about growth in automotive sectors and that would continue with our effort to expand to meet industry requirements. Thank you very much. Stay safe, stay healthy and thank you once again for joining us.
Operator
Thank you very much on behalf of jtech India Limited. That concludes this conference call. Thank you all for joining us. And you may now disconnect your lines. Thank you.