Divgi TorqTransfer Systems Ltd (NSE: DIVGIITTS) Q3 2025 Earnings Call dated Feb. 17, 2025
Corporate Participants:
Jitendra Divgi — Managing Director
Sudhir Mirjankar — Chief Financial Officer
Analysts:
Mihir Vora — Analyst
Mahesh Bendre — Analyst
Manish Goyal — Analyst
Presentation:
Operator
Ladies and gentlemen, good day and welcome to the Q3 FY ’25 Earnings Conference Call of Divkey Talk Transfer Systems hosted by Equirus Securities Private Limited. As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star, then zero on your touchstone phone. Please note that this conference is being recorded.
I now hand the conference over to Mr Mihir Vora from Equirus Securities. Thank you, and over to you, sir.
Mihir Vora — Analyst
Yeah. Thank you,. Good morning, everyone. So on behalf of Equirus Securities, I welcome you all to the Q3 FY ’25 post-results call of Devy Transfer Systems. From the management side, we have Mr Jitendra Divgi, Managing Director; Mr Hirendra Divgi, Whole-Time Director; Mr Sudhir Mirjankar, CFO; and Deepakwani, CEO.
Without further ado, I now hand over the floor to Jitin for opening comments. Over to you, sir.
Jitendra Divgi — Managing Director
Yeah. Thank you, Mihir. And a warm welcome to all our participants — participating investors and other people, analysts who have joined this call. I’m going to break-up my brief introductory remarks into three segments. First, I’m going to talk about the Q3 quarter and the various elements that the developments that have happened. I’m going to then talk about certain key achievements that were — that took place recently in the last three to four months. And then we’re going to look at a little bit at future visibility and a quick update on the next-gen products that we have been working on.
So let me dive straight into the highlights of Q3 and the first-nine months of FY ’25. Now those of you who joined the last few earning calls may recall that we started the year-on a somewhat depressed note due to challenges faced in two of our two main business segments, which is the four-wheel drive transfer cases and our EV transmissions that we make at our new plant in Pune.
On the transfer cases, over the past 3/4, the volume offtake has been disappointing and lower due to two developments. One is the introduction of a low-cost variant without four-wheel drive and the transition that is underway a little bit at our largest customer here, Mahindra from the three door version to the five door version and that has involved a little bit of a ramp-up that was needed on the five door new model however the based on the forecasts that are coming in on schedules we are anticipating a slight improvement this quarter and certainly going into the first-quarter of the next financial year.
I should add that although the numbers were depressed, the per unit realization of on the — while on the transfer cases was significantly better. This is because of defense sales, which have a higher per unit price point and also the volume-based pricing plans and contracts that we have in-place. So while we are experiencing a temporary slowdown in this business, you know, our focus remains on getting value, strengthening partnerships with OEMs that and continuing sort of exploration of widening both market segments and product portfolio.
Looking ahead, we are confident that the expansion of the transfer case business into international markets, particularly with Japanese OEM — Japanese, Korean and American OEMs, along with the introduction of innovative new variants in the domestic market will drive medium-term and long-term growth. The globalization of our transfer case portfolio is underway with some significant new opportunities in the US aftermarket, which we believe will strengthen revenue streams. This has a recent development that has happened and we will have updates in this regard the ensuing quarters as we go-ahead.
As far as EV transmissions are concerned, this segment has been the most disappointing relative to the original business plans and letters of intent and capacity planning that was given to us by customers but we believe that a tipping point may be on the horizon with the introduction of new models that are coming in. Those of you who watch this industry, I’m sure are aware that Mahindra has introduced a new models with 500 kilometer plus range and that may very well turn out to be a tipping point. So to address the sort of headwinds, you know, we are widening our portfolio.
And I’m pleased to tell you that we have been awarded further contracts to widen our product portfolio beyond just the Nexon to include the long-range versions of the punch and the curve and also four-wheel drive options on the Harrier and Sapari at Tata. We have also quoted on significant new opportunities for component kits for at least three more OEMs and that work to try and acquire these new businesses is underway in right earnest. As far as the new product development on the current business portfolio is concerned, we expect revenue streams to start in the June, July timeframe with production ramping-up thereafter. So we are expecting a significant increase in FY ’26 as a result of this development, and the industry now has a strong focus on localization, which is what we are bringing in order to reduce the dependence on imports from China. So we are fairly confident that with this development, the first-half of next year will be significantly better in terms of our revenue coming from the EV transmission segment.
On components we have made considerable progress. I think overall the sales has almost doubled on components and it will continue to rise. It be driven primarily by export markets, where again there was — we’ve got approval for production approval for almost eight components, they total up to a million units a year at the RFQ volumes and have a revenue realization of almost INR90 crores. These are opportunities that are coming to us from China, Korea, Europe, a plant in Portugal, in Europe, the United States and Mexico. And additionally, we have active development going on both in terms of acquiring new businesses and developing new parts for markets in Japan, Thailand and again US and Korea. And this realization of this chunk of INR90 — about INR90 crores per year will start. It has actually already started in a modest way and we will see the results unfolding from Q4 onwards, but really making a significant impact from Q1 of FY ’26.
As I said, we have secured final production approval for all these parts and including export orders from China, we are expecting an additional jump of almost INR7 crores a month. This of course is subject to you know, the schedules that will come about, but we expect something in that range. We continue to deepen our engagement with Tier-1 — global Tier-1 suppliers across the world and particularly the US. So with a growing global footprint and increasing export volumes, I think we are on-track to generate a significant share of our revenue from international markets from next year.
By the end of FY ’26, exports are expected to contribute a double-digit percentage of our overall revenue and further sort of bringing energy and life on the global business expansion. I want to take a moment and talk about some significant achievements also while the financial numbers were not to our expectations, there have been some very substantial achievements that have strengthened our brand reputation and the proposition that we bring in India’s automotive industry.
Some of you may recall that in September of ’24, we won the Toyota Supplier of the Year award and I’m very pleased to report that we have now also won the proprietary powertrain commodity Supplier of the Year at Mahindra and Mahindra again. Again and this is the second time we have won this at Mahindra. We’ve also won this kind of an award two times at Toyota in the last five years. And in this year, winning back-to-back awards from two major OEMs who have a very, very strong position in sport utility vehicle and pickup truck segments reaffirms the quality of our products, our cost competitiveness and our execution — overall execution competence. I think it’s all — it’s a tribute to the unwavering dedication of our employees in understanding and executing the needs of giants like Toyota and Mahindra in the way we have executed work for them. This recognition marks a significant milestone in our powertrain systems journey.
I think it reflects our focus on innovation and delivering technology-driven solutions. You would agree that these accolades strengthen our brand position and reinforce our dedication to providing advanced technology to our OEM customers. We also had a very successful auto export and as we took stock of all that happened in those four days, we realized that the overall kind of revenue opportunity space that we generated from was almost INR2,000 crores with strong interest from leading Indian and multinational OEMs. I might add that there was a significant amount of interest shown by overseas OEMs in our systems solutions and follow-up meetings have been set-up over — and we are going to see a lot of things unfolding and of course, it’s up to us to convert the activity that this opportunity has thrown up into a concrete business. Some of you may be aware that in till 2016 we were part of a joint-venture with.
We took the decision to buy-out their share and then establish an independent Indian brand starting in the year 2016. This decision required us to modernize and upgrade our facilities while increasing capacity to support the growth. And during this time, we made significant investments to prepare for growth and broaden our product portfolio. After renegotiating a long-term supply agreement for seven years, so from 2017 to 2024, we have now signed a new agreement for technical marketing and supply-chain collaboration for another seven years with the Drivetrain Systems Group. So this reaffirms our long-standing relationship and strengthens our partnership, driving innovation, expanding market reach and enhancing our operational efficiencies for long-term competitive advantage.
This agreement is multifaceted. It includes technology, it enhances our ability to sort of build-on top of the brand promise of and gives us reciprocal supply-chain, global supply-chain opportunities in terms of being able to integrate state-of-the-art supplier based solutions from supply-chain and in-turn get for ourselves global opportunities to support across some 20 plants of their drivetrain division. This partnership also gives us regular access to the top decision-making management team of and generally gives us recognition and visibility at corporate headquarters in Boe so it sort of reflects our ability to build our brand globally by association with renowned brands like so that those were some updates I wanted to bring you up to speed on.
So as you can see there has been a lot of activity side-by-side with our steady-state revenue operations. Continuing this further, I want to take a few moments and give you some idea of future visibility and an update on our next-gen transmission development. I’m really pleased because there is an India, I can’t give you more details at this stage, but suffice it to say that we have signed an MOU with one of the world’s largest Tier-1 transmission manufacturers to do a feasibility study in India to produce over 100,000 automatic transmissions for localization for Indian, for the Indian automotive industry.
Over the past few weeks and months this initiative has undergone extensive evaluation including in-depth discussions, technical assessments and joint plant visits. The study is in its final phase and we expect a final decision sometime by the middle of March. In addition to this, we have signed an NDA with one of the world’s most prestigious OEMs in Europe are to do a feasibility study on the manufacture of an eight-speed dual-clutch automatic transmission. It’s interesting that this opportunity has come from Europe for a very, very state-of-the art product, some of you are aware that dual-clutch transmission is an area that we’ve been working on in terms of R&D efforts for the last eight or nine years.
This collaboration and this ability to forge a partnership of this nature highlights our expanding role in the global automotive sector and aligns with our commitment to bringing advanced transmission technology to India with deep localization. We are also engaged in active discussions with leading Japanese and Korean multinational OEMs and I must say this is very, very significant because it’s very unusual for a Japanese OEM to be talking to an Indian Tier-1 for an advanced electronically controlled drivetrain aggregate system and — but that’s what we are doing for the development and supply of an electronically controlled transfer case and six-speed manual transmission systems.
Now these opportunities this offers us opportunities for long-term collaboration and innovation in this segment. You know to become a Tier-1 supplier of this nature to Japanese and Korean OEMs means it’s a — it sort of gives us a long-term durable opportunity to build a long-term durable partnership with these renowned companies. And personally, I am very thrilled and excited as to where this will take us. Indications right now are that this will be concluded by March-end and we have been requested for prototypes in the September, October time-frame. So it is in an advanced state of discussions and hopefully by the next earnings call we will have a little more information to share with you so the other interesting update that I wish to give you is that we are also working on a very large opportunity to take-over about 150,000 manual transmissions from a major Indian OEM for a pickup truck application.
What all this is pointing to is, I think a vindication of the prognosis that we in ET has had about the future of industry, the automotive industry a couple of years ago that as the market churn happens localization and electrification technology. The pressure is going to come on OEMs to be fast and nimble and a little more desk at handling an increasingly complex vehicle product portfolio. And to become a nimble in this regard, they are — they will be compelled to farm-out a lot more work that traditionally they have been doing in-house and investigate opportunities to have — so where more work is given to a Tier-1 and both globally from what I’ve just narrated to you and in terms of what’s happening in our domestic markets the signs are very clear and obviously all of this affords very good growth prospects for us.
In previous calls you know, I have mentioned that we are actively exploring opportunities on next-gen transmissions that includes state-of-the-art automatic but also hybrid systems and they connect of course with a lot of things going on in electrification because that is the future and technology of this tank will take an increasing share of the portfolio as we go into the future. We believe that our infrastructure and the assets that we have invested in position us as a full-service systems provider equipped with established tools and the expertise for product development and manufacturing.
So I’m very pleased to report that we have achieved the first milestone of completing the first phase of our feasibility study for dedicated hybrid transmissions. The first — eventually the study is to try and understand the extent of improvement in fuel efficiency that can be delivered with this technology for customers in India. And towards that end, we have the first prototype of our dedicated hybrid transmission available with us with which further studies are going on. And I will have updates as we go-ahead in ensuing earnings calls. That about brings me to the end of my remarks.
But before I conclude, I would like to reaffirm what I think is our core message that what brought us to the market is something that we are committed to. Our focus continues to remain on what I believe are the key strengths that differentiate us, not just within India’s automotive supplier base, but on a global — on the global stage. As I’ve highlighted in my remarks, our achievements reflect our commitment to continuous innovation and invention, which are at the heart of our business. But I think true impact comes from complementing these good ideas with world-class product development and manufacturing, which are critical factors in delivering value to our customers. And the ability almost in a space of six months-to win from Mahindra and Toyota hopefully reflect that we are walking the talk.
So I hope this update has given you some insight. I know — I’m going to hand over the proceedings to our CFO to walk you through the numbers and then we are available for Q&A to talk about Q3 and what is it that we’ll be doing in the ensuing quarters. So thank you for your time and attention and I will now hand over the proceedings to Sudeer Miljankar, who will walk you through the financial numbers in some detail. Thank you again, and over to you, Sudhir.
Sudhir Mirjankar — Chief Financial Officer
Thank you, sir. Good morning to everyone on the call. Before presenting the financial numbers for the quarter and the first-nine months of FY ’25, I would like to highlight a few key points. The performance over the first-nine months remained subdued, primarily due to a decline in volume uptick in both the EV transmission and transfer case segment, each facing its own set of challenges. This had a negative impact on overall revenue from operations and resulted in lower operating profitability.
In the Transfer case business, the adverse effects are partially offset by improved price realization supported by volume-based pricing within the framework of our existing contracts, which included provisions for compensation in case of lower volumes. Meanwhile, in the EV transmission business, we broadened our scope and reinforced our presence by expanding coverage across all platforms of our existing OEM. Operating — operating profitability was further affected by lower fixed-cost absorption and higher expenditures related to tooling revenue. The decline in operating profit also weighed on profit-after-tax. Looking ahead, we anticipate some depreciation impact from plant and equipment modernization for expansion projects beginning in FY ’26.
So coming to numbers, our total income for the first-nine months of FY ’25 stood at INR176 crores, reflecting a 13% year-on-year decline compared to INR203 crores in nine months of FY ’24, primarily due to lower sales volumes. The revenue mix, the Transfer case business saw a 32% decline, while the EV transmission business achieved 13% year-on-year growth. Component business, this segment continued its strong performance, recording a 46% year-on-year growth with a robust order book from both domestic and international customers, we expect this momentum to sustain, positioning the segment as a key contributor to margin expansion. Whilst export contributions remain in single-digit at present, we anticipate a steady growth trajectory. With multiple business contracts secured, we are confident of achieving double-digit sequential growth in the coming quarter.
Gross margin — overall gross margin improved to 63.2% in nine months FY ’25, up from 61.1% in nine months FY ’24. This expansion was primarily driven by our volume-based pricing strategy in the core transfertive business, which optimized revenue realization despite demand fluctuations. These factors have significantly enhanced profitability, reinforcing our commitment to operational efficiency and sustainable financial performance.
EBITDA for nine months FY ’25 was INR44 crores, down 19% year-on-year from INR54 crores in Nine-Month FY ’24, impacted by lower fixed-cost absorption due to weaker volumes. EBITDA margins stood at 25%. Profit-after-tax on for nine months FY ’25 was INR19 crores, marking a 38% year-on-year decline from INR30 crores in nine months of FY ’24. PAT margin stood at 10.8%, affected by overall lower operating profitability.
So coming to Q3 FY ’25 performance, our total income for Q3 FY ’25 stood at INR57 crores, reflecting a 15% year-on-year decline compared to INR68 crores in Q3 of FY ’24. On a quarter-on-quarter basis, revenue remained stable. EBITDA for Q3 FY ’25 was INR14 crores, down 23% year-on-year from INR18 crores in Q3 FY ’24 and 18% quarter-on-quarter. The EBITDA margin for the quarter stood at 23.6%. So profit-after-tax for Q3 FY ’25 stood at INR5 crores, marking a 44% year-on-year decline from INR9 crores in Q3 of FY ’24 and a 33% Q-on-Q drop quarter-on-quarter growth. Our PAT margin for the quarter stood at 9.1%.
So that’s it from my side. And now we can open the floor for question-answers.
Questions and Answers:
Operator
Thank you so much, sir. We will now begin with the question-and-answer session. Anyone who wishes to ask a question may press star N1 on their touchstone telephone. If you wish to remove yourself from the question queue, you may press time to. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question comes from the line of Mahesh from LIC Mutual Funds. Please go-ahead. Please go-ahead, please go-ahead.
Mahesh Bendre
I’m audible?
Jitendra Divgi
Yes.
Mahesh Bendre
Yeah. So thank you so much for the opportunity. Sir, last few quarters, we have been reporting de-growth on quarter — probably almost every quarter. So how do you see the near-term quarter in terms of quarter-four performance? And if we are to look for FY ’26, any guidance you would like to give in terms of achieving certain revenues going-forward.
Jitendra Divgi
Yeah. Thank you, Mahesh. I mean I we are acutely sensitive and aware of what is happening and this is that this Q3 has been disappointing however you know what are the what I would request you to look at is what are the substantive corrective measures that are underway to address this state of affairs, okay? One is, excuse me, inherently in the contracts that are available, we are expecting some consolidation, stabilization and some incremental improvement in volumes as the Thar rocks at Mahindra stabilizes. We have a the Scorpio N model also going-in for exports over the next — so over the next 3/4, this business will show some incremental improvement. That’s our expectation. But it will not be enough to offset what has happened.
That brings us to the second — so let me first finish the four-wheel drive segment and then talk about other segments and then sort of summarize the whole thing. We are also working on, as I said, some global opportunities. Yeah, these are Japanese and Korean OEMs operating both in India and overseas, okay. The advantage is that we have been requested to leverage off our off-the-shelf offerings, which is what gives us the ability to have a relatively short lead-time to going into — going to the market. So the efforts that are underway are to try and diversify the customer-base and also the product base in our core four-wheel drive business.
The second one, which I think is a significant corrective action is the development of this bigger gearbox which the customer had sort of given its last priority, assuming that the lower-end version had to be localized first given the cost-competitive nature of the smaller segments. Unfortunately, the market kind of abandoned the low-end and went screening of course towards the higher range of the market where our customers were caught is still importing from China. But now that we have this successfully under development, this particular design, as I mentioned, goes on five different models as compared to three models of the smaller gearbox that we had. So we expect a some significant improvement, although the risks of the EV remain and the risks primarily come from the fact that there are other OEMs catching-up with the market-leader which is Tata Motors and so we will have to see how that plays out. But be that as it may we have now the presence on relatively fast-moving segments like the punch, the nexon and the curve immediately. So this is another corrective action which is underway.
And finally I’m sort of keeping the best for the last is the eight different export components where we have pulled off all eight projects right first time. And I think our team in the tin and the heat of the moment of these declining sales, this incredible achievement of our team should not go neglected. And what they have pulled off is quite spectacular. From China to Europe to the United States, to Mexico, four different international markets. We have put a export kind of a business package, which as I referred to earlier in my remarks, remarks has a revenue realization potential of about INR90 crores back on-track. And that I think is what will also propel our sales going-forward. So these are the main near-term, I think, tactical interventions we’ve succeeded in putting in-place.
The assets are — we’ve always said that they are fungible. We can sort of use our assets across four different verticals of our business and so the implication of these achievements, Manish is that the way we are looking at it is that FY ’25 will be seen as an aberration. The trajectory that we are focused on is the growth that we had promised starting FY ’20, okay. And we have not forgotten the promise of bringing the growth back on a trajectory of that 15% CAGR, 15% to 20%.
And I think there will be significant improvement of starting April, it may take a month or two, but certainly starting next quarter. We will see some impact of the export orders in this quarter itself. But the real substantial ones will come later on. I want to offer an explanation here that all the eight projects we have won and if you add-up the RFQ volumes, it comes to almost 1 million pieces a year. So we are talking more than 100,000 components being exported every month. All of this has come through the China plus One sourcing. These are not new developments per se, new to us maybe, but ongoing programs at OEMs and Tier-1s across the world, including 20% of this is coming from China. And that I think is another very, very, very significant achievement.
Now because this is China Plus One ongoing programs, the customer plants across the world have been sort of trying to figure out how to transition given the momentum of their own business from that source in China to Disney. So there has been a little bit of going back-and-forth in scheduling. So one particular customer of in the Midwest who has about 350,000 to 400,000 parts per year has kind of pushed out the whole schedule and the ramp-up to second to their second-quarter, which is the April to June quarter for us and that has kind of delayed the revenue booking at our end. But the approvals are in-place, we have stock tower warehouse in the United States and you know, it’s like that the arrow is in the at drawn ready to be fired. So that is what I would like to tell you. And based on this, you know, I think we will see 2025 as a sort of tactical aberration and the growth we are looking at ’26 with reference to FY ’24 and getting our growth back-in play.
Mahesh Bendre
Sure, sir. And sir, what is the current capacity utilization across our factories and what are the capex plans for next year?
Jitendra Divgi
Yeah. Thank you for that question. It’s a very, very pertinent one. Because of the way we were told to capacitize by our customers for transfer cases and EVs, our utilization is really quite low there. On transfer cases, it’s less than 50% and on EVs, it’s about 20%. So — and despite that, we are generating an EBITDA of 20% plus. So you can imagine what impact it will have if we have some significant improvement in the top-line. We are very, very clear about the cost structure and Sudhir, my colleague alluded to the gross margins that we are working with. We are very conscious when we quote, when we’re doing product development, there is an unwavering eye that is kept on our contribution margins on and therefore our EBITDA percentages and ultimately, of course, the ROI.
The ROI right now, I’m afraid is short to pieces given the utilization and the decline in the top. But our effort is to maintain, first the gross margin, the contribution margins, then take care of fixed costs so that the EBITDA margins are kept and that is how we approach the business. So in these two segments, we do not anticipate a significant investment, that is transfer cases and EVs. The capex plans will come are expected for the automatic transmission of business that as I mentioned, we are working on two different parallel tracks and one of them we hope to have some kind of closure March-April time-frame. It’s actually overdue, but because of certain constraints with our customer, overseas customer, they were not able to provide a certain amount of data that we had requested and it’s been delayed a little bit but please bear in mind that if we pull this off this deal will be kind of historic because it could end-up becoming the transmission story of 2025, not just in India but across the world because I don’t think anybody is attempting a transfer of technology and manufacturing of over 100,000 automatics in any part of the world right now. So that is what your company has reached now to be able to convince, persuade one of the world’s largest Tier-1s that is making several million units across the world and to convince them to come to India with us. So that is where I expect the capex to happen and which is why — because of this delay, there is that cash sitting on our balance sheet.
Mahesh Bendre
Sir, this — sorry, sir, last question, will this capex will be high? I mean, I mean, mean any ballpark in maybe INR50 crores?
Jitendra Divgi
No, it will be — it will be in excess of — between in capital investment and working capital, it will be well in excess of INR100 crores. It’s a big program. The automatic transmission program at a minimum will give a turbocharging boost of over INR500 crores for top-line.
Mahesh Bendre
Thank you, sir.
Operator
A reminder to all participants, please press star and one to ask a question. Thank you. The next question comes from the line of Manish Goel from ThinkWise Wealth Managers. Please go-ahead.
Manish Goyal
Yeah, very good morning, sir. Thank you for detailed update, sir. I have a few questions. First on the — just a clarification on RFQ what we have received for 150,000 transmissions, is it for manual transmission system or EV transmission. And is it for system or its components like if you can clarify that first sir. Thank you very much.
Jitendra Divgi
That’s a very good question because it gives me the opportunity to expand on this and clarify. We are very excited by this development and let me be very clear, it is a manual transmission for a pickup truck in India. It is not an EV. It is this opportunity is in addition to all that I’ve told you on EVs and automatic transmissions. And it is a reflection of the pressure that our OEMs are under to make a better use of their own capital as they wrestle with increasing complexity in their product portfolio. And the many years of preparation that has gone into positioning us proactively to take advantage of such developments. So I think our strategic foresight has paid-off and we are in a very good position to take-over this product-line and it is the very key part of your question is a set of components or systems. I can tell you very clearly the OEM is expecting us to deliver a full system-based solution.
Manish Goyal
Okay. And this is for the existing product or is it something which a new product developed by OEM and you are probably looking to provide this manual transmission?
Jitendra Divgi
It is it is an ongoing program the total volume is actually well over 200,000 but one significant portion of it about I mean I use the 150,000 as a sort of thumb it will be somewhere between 120,000 to 140 but we have been requested to plan a capacity of 150,000.
Manish Goyal
So ideally basically so it means that we are replacing some existing manual transmission.
Jitendra Divgi
No what is happening is this work is being the planning is underway to shift this out-of-the OEM so that space is made available for other next-generation stuff that the OEM wishes to undertake okay. And thank you, sir. And the other critical part of your question is whether this is a new vehicle or no, it is existing. So there is tremendous momentum in the — in the project and it has to be handled with a lot of very deathly without causing any dislocation in supplies. So which is why they are looking at us because we have a reputation for executing projects of this nature.
Manish Goyal
Sure, sir. And what would be the realization for manual transmission? I believe for BCT in past, you have mentioned about INR1 lakh something per system. So for this system, what would be.
Jitendra Divgi
The pickup truck segment is extremely competitive. So the manual transmission realization will be quite competitive. Because there is an NDA and it’s under negotiation, I wouldn’t like to hazard a number here, but it is significant. The opportunity is well over INR200 crores to the top-line.
Manish Goyal
Right, sir. And sir, on the absolute — sorry, for the exports, I really appreciate that the run-rate will pick-up going-forward. But if you can provide us with what could be the absolute number we’ll end-up in FY ’25 and what we could see in FY ’26 and when do you think we’ll reach the peak run-rate and probably each quarter month or something? Thank you.
Jitendra Divgi
Again, thank you for a very perceptive question. You know, we used to do about — and let me just sort of step-back a little and quickly give you some background and context. Historically, the best turnover we had achieved was like about INR80 crores. Yeah, but we have reached about INR80 crores export. And then for various reasons the Ukraine war, the China geopolitics, the life-cycle change going, all of that hit us together and we kind of plummeted down to like less than INR5 crores. But we knew it was sort of temporary because we had a lot of development going on. So from that less than INR5 crores, this year, we expect about INR13 crores.
Yeah, yeah. FY — we were expecting — our budget was actually about INR40 crores exports for this year but unfortunately because of this coming out-of-the China source and handing over to India and doing this, you can imagine that the customer locations are in this huge part of the United States, which itself is a huge country and then you are switching from a source in China to a source in India. So logistics is extremely is complex and it has to be very carefully orchestrated. So that has taken a little bit of time.
So instead of doing the 40 in this quarter, it will end at around 13. And as I mentioned, the total value of this, so remember what this is, we have got all the production approval, which means the production lines are in-place, the mobilization has happened, there is material sitting in our warehouses, the schedules are coming in. That’s why it’s like going into steady-state even as we speak. And it will start maybe with around 6 crores to INR7 crores a month and then at its peak will go to INR8 crores to INR8.5 crores a month. There are a couple of products where the customer is talking about a sharp spike coming in next second-half of this year, but we are waiting for how that thing will consolidate. These are still early days. So to answer your question, it will start at around INR6 crores a month and then go to about INR8 — about INR8 crores at the peak. And all this is — this is going to unfold in FY ’26. So we are expecting about INR80 crores to INR90 crores in that range. That’s the expectation for next year.
For the entire year, INR80 crore to INR90 crores in exports. Yeah. And so parallelly like how are domestic components doing, sir and what is the outlook for that? Domestic actually is showing thanks to a extremely robust performance by and we are very proud of the achievement of Mahindra. I want to take a moment and tell you, give you a very striking market insight, which I think a lot of the industry observers may not have noticed. One of the things we track is the top-20 models that make-up the bulk of the Indian automotive industry, okay. And till like 18 months ago, the Japanese and Koreans used to dominate the top-20 models, and Hyundai and it is a matter of great pride to tell you people that between our Tata and Mahindra, they have fought back and they are now increasingly dominating this space.
The latest data we have shows that among the top-20 models, while Bharuti continues to be the leader, the number two guy now is not any other Japanese or Korean, it is Mahindra and Mahindra has five blockbuster products in this top-20 okay Tata has about 2 and then of courseundai and make-up the rest. There’s no American no European player in this — in the top-20 models. So, and we are, as I mentioned earlier, the proprietary powertrain supplier of the Year award from Mahindra has come to us. So and we are also helping Tata Motors in indigenizing the transmissions that go into their EVs. So this is an enviable position to be in. And that is why I say that the domestic, we are extremely optimistic about the domestic business. We are also working with — doing a lot of discussions that are going on with Isuzu, these are some other brands that we are working with.
So given the circumstances and given what has happened in Q3, I think this is a good position to be in to try to remedy our medium-term and long-term. Long-term. So this is how I look at the domestic. On overseas, you know, we have a — we continue to — the total number of RFQs that we have quoted on is in excess of INR600 crores. And a lot of hard work is underway to try and convert. So we may have further announcements every quarter as we accomplish new business acquisitions. A very interesting update that is on our overseas is we are uncovering an unearthing opportunities in the American — four-wheel drive recreation and general utility market where which segment is almost the size of India’s SUV industry? And next week, my brother Hiren, who is on this call travels to the US to pursue and look at how we need to position our products in that — and that is all transfer cases at which I think we are the most competitive in the world. I have no hesitation in saying that, which is why also the Japanese are talking to us now.
Hiren, can you if you are on the call, you wanna make a comment on that? Mister Digvi, please go-ahead. Are you muted? You may need to unmute.
Manish Goyal
Can everybody hear me?
Jitendra Divgi
Yes okay yeah so you know the four-way market is true in the world and let me introduce let me give just a very brief snapshot at what possibly we can so in India we had the kind of a close to a monopoly position because of our 21 years joint-venture with in bringing the most best technology in the world but India remains a kind of so we have systems in India as a news market and what we felt as a management is that we need to first locate ourselves in the fastest-growing markets in are into cognizance the changes that are happening in the drive train systems because of the influence of electrification and we that we have an approach that we are working on that enables us to another what I should call a blue ocean market for us where the global competition like, Magna iPhone are not looking at these are more competitive markets in, in on a slightly lower-volume, more difficult to handle applications that I think we are being plugged into the Indian ecosystem can handle this market much better and having a presence in the US we can kind of meet this market requirement much better. So this is a process under investigation and as we make progress, we will keep talk.
Manish Goyal
Thank you so much, sir.
Operator
Ladies and gentlemen, that brings us to the end-of-the question-and-answer session. I would now like to hand the conference over to the management for the closing comments.
Jitendra Divgi
Yeah. This is Jiten here. In conclusion, I just want to reiterate and reaffirm the sort of promise that we had given investors. I know Q3 has been disappointing. The real solution, I think to our state of our business is to correct the top-line. We have a solid fundamentals and as we discussed in our remarks and in answering questions, hopefully, you’ve got a flavor of what are some of those opportunities that we are working on short-term, medium-term and long-term. And in subsequent quarters as we have these exchanges, we will have the opportunity to talk to you and update you on our progress.
So in conclusion, I want to thank you for your support through these difficult times. And I’m quite optimistic and confident that we will not disappoint you going-forward. So thank you very much.
Operator
Thank you, sir. Ladies and gentlemen, on behalf of Equirus Securities Private Limited, that concludes this conference. You may now disconnect your lines.