Samvardhana Motherson International Ltd (MOTHERSON) Q1 FY23 Earnings Concall Transcript

Samvardhana Motherson International Ltd (NSE:MOTHERSON) Q1 FY23 Earnings Concall dated Aug. 08, 2022 

Corporate Participants:

Vivek Chaand Sehgal — Chairman

Pankaj Mital, — Chief Operating Officer and Whole Time Director

Laksh Vaaman Sehgal — Director

Kunal Malani — Chief Financial Officer

Analysts:

Siddharth Abhiram — Nomura — Analyst

Joseph George — IIFL — Analyst

Saurabh — Ambit Capital — Analyst

Chirag Shah — Edelweiss — Analyst

Dhawal Doshi — Pinpoint Asset Management — Analyst

Arvind Sharma — Citigroup — Analyst

Hitesh — CLSA — Analyst

Jinesh Gandhi — Motilal Oswal Financial Services — Analyst

Ronak Sarda — Systematix — Analyst

Presentation:

Operator

Ladies and gentlemen. Good day and welcome to the Q1 FY ’23 Results Conference Call of Samvardhana Motherson International Limited. [Operator Instructions]

I now hand the conference over to Mr Vivek Chandra Sehgal. Thank you, and over to you Mr Sehgal.

Vivek Chaand Sehgal — Chairman

Thank you very much. Good evening, ladies and gentlemen. The Board approved the first-quarter results and very happy to explain to you that this is the highest ever. Sales in the quarter. Including earlier it up task of multiple systems and very, very pleased to tell you that the demand is very, very strong and robust. We are on our toes to keep up with the changing demand of the customer because of certain challenges on components and things like that. These challenges are basically multiple movement of currency and things like that. It also logistics and there are some forces agreement side people are a bit dated because it would be the high inflation et cetera in those countries.

Operator

Ladies and gentlemen, the line, from Mr Vivek Chaand has got disconnected request you all to please stay online. While we reconnect the line. Thank you

Ladies and gentlemen, thank you for patiently waiting, over to you, sir.

Vivek Chaand Sehgal — Chairman

Thanks. The good news is that the customers are very willing to support the cost pressures only they are requesting for valid proofs and that takes time there’s multiple moving parts and challenges, which looks better and better as the world grapples to solve the challenges and demand for the higher value cars August even better for us. Thank you, and over to you for your questions. I have Pankaj Mital here I have Kunal here, I have Rajat Jain and Laksh Vaaman Sehgal to answer your questions for you. Good day. Thank you.

Questions and Answers:

 

Operator

[Operator Instructions] First question is from the line of Siddharth Abhiram from Nomura. Please go ahead.

Siddharth Abhiram — Nomura — Analyst

Hi, sir. Thanks for the opportunity. Sir, My first question is on this reporting structure. So you have this time the credit reported in a format. So there is some clarification required for example in the consolidated reporting numbers. If we look at the revenues as per SEBI and prosper PPT while the revenues are similar. There is a difference at the EBITDA level. So if you can just help us clarify that. Why is that different both for console as well as standalone numbers.

Vivek Chaand Sehgal — Chairman

Thank you. Kunal can you take that please?

Kunal Malani — Chief Financial Officer

I’m presuming you’re referring to slide 24.

Siddharth Abhiram — Nomura — Analyst

Yes.

Kunal Malani — Chief Financial Officer

Right. And the revenues there, if you were to look at the safety reporting global find that in the segment accounts so the segments will look exactly the same as what you have in 24 if you can highlight where the gap is

Siddharth Abhiram — Nomura — Analyst

Okay. So basically, when we just as per the SEBI reporting format, the EBITDA comes to at about INR1,077 crores, but as this slide, it is 1151 crores. So I was trying to understand why is this gap

Kunal Malani — Chief Financial Officer

As per SEBI format. If you look at there is interest as one I mean, I don’t know how you’re treating the other income portion, but if you look at the segments, again you will see two line items, which says interest income and other income those are the two lines that we are excluding from the computation of EBITDA to reach 1151, you may have taken the whole other income out of it. Because there are some portions of the income which is still more operating in nature, but classified under other income and hence, that portion is still getting included in EBITDA. But the, specifically the interest income and what is really other income is what is getting excluded which is in the segment accounts.

Siddharth Abhiram — Nomura — Analyst

Okay, got it. So basically that is not coming in the revenues while that is coming more at the EBITDA level.

Kunal Malani — Chief Financial Officer

That’s right.

Siddharth Abhiram — Nomura — Analyst

Okay. And second, sir. I mean dividend possible to indicate the revenue like you have been doing for the past results also for the S&P SMR NPKs

Kunal Malani — Chief Financial Officer

Look we are highlighted this all the way back in January that we will be moving into this new format. You will get a little bit of flavor of what you’re asking for in the SMRT results, which should be up pretty soon. But, and then the last appendix of the presentation, you would also see the historicals for each of the divisions. So we wanted to move to this to this new format in case there are any specific aspects that you want to discuss on the new format. We can do so, but now the COD and as per the accounting side has already changed into this new format.

Siddharth Abhiram — Nomura — Analyst

Okay, understood. Okay, sir. Thanks. I’ll come back in the queue.

Operator

Thank you. [Operator Instructions] The next question is from the line of Joseph George from IIFL. Please go ahead.

Joseph George — IIFL — Analyst

Thank you. I think the one question then SMRT reports its numbers. Well, the segment will be split into SMP will it be Vision systems and modules and volume is in line with your consolidated reporting

Kunal Malani — Chief Financial Officer

It will be Vision systems and module and polymer. So as you would expect the erstwhile S&P would largely be aligned to Mannville polymer and the erstwhile SMR would largely be aligned to Vision vertical do, there’ll be some minor differences but largely I would say it’s aligned with those

Joseph George — IIFL — Analyst

Understood. Thank you. That’s all I had.

Operator

Thank you. [Operator Instructions] Next question is from the line of Saurabh from Ambit Capital. Please go ahead.

Saurabh — Ambit Capital — Analyst

Hello, hi, sir, good evening, sir. Just like you helped us understand the SMP and SMR break up. So would it be possible for you to help us reconcile the revenues from various entities into division-wise. So basically, I just want to understand well, how have you compile the data division wise, which was, while being reported as per the entity wise. So, just help us understand how is the revenue flowing now so that we can kind of align our estimates, according to the division-wise going forward

Kunal Malani — Chief Financial Officer

So simply put what was erstwhile SMR is now part of Vision systems. What were erstwhile S&P is part of module in polymer and what is erstwhile PTC as part of wiring harness so that’s the simplest way to look at it. Obviously, now you’re getting a full picture view of what is wiring harness even beyond PKP which in our earlier disclosures used to end up being in others. And hence our acquisition that we had done in WFSI is also part of wiring harness MSV as part of wiring harness our wires business is part of wiring harness and so on and so forth, so this provides a much more comprehensive view of the entire decision and all its subcomponents that add up to which was not there earlier when it was just a legal structure disclosures that’s a good.

Similarly on the module and polymers, besides our other international businesses whether in South Africa. Hungary or our India businesses are also part of this same applies for the vision side our India businesses are also now. Now, part of it. The others. Hence you would imagine, is now a smaller number to what was being disclosed earlier though, if you add the family portion, the numbers again started looking larger, but that’s the inclusion that has happened, which then has business here last normal the metal side levels technology and so on.

Saurabh — Ambit Capital — Analyst

Got it. But keeping aside the entity division wise breakup. So when I was looking at the standalone figures. So basically, there has been some disconnect in the current presentation as compared to the presentation shared in the 4Q FY ’22. So, could you please highlight if there is any a disconnect on this end

Kunal Malani — Chief Financial Officer

The presentation given in FY ’22 was under the old format of SMR SMP BKC it was not under the new format. So sorry, I’m not sure which one are you referring to

Saurabh — Ambit Capital — Analyst

So basically what I’m saying is excluding the SMR BKC business. I’m talking about simul standalone business. So basically in the 4Q FY ’22 figure standalone figure was 1,611 rupees while currently in the first quarter, we reported it as 1,618, sorry 1,631. So the difference over here. Similarly, for EBITDA margin as well. So basically in the fourth quarter you had reported 18.2% as EBITDA for 4Q FY 22 while currently it’s growing as 14%. So there are multiple disconnect. So if you could help us understand how has been how have we transformed dose because end this figure. So that will help us get some clarity on the accounting part at least

Vivek Chaand Sehgal — Chairman

So EBITDA one I can quickly tell you the 14.2 that you’re referring to has a note, where we have completed the margin, keeping the exceptions out of the 14%. We have kept the margins keeping the exceptions. If you remember, in quarter 4. We had highlighted this 65 crores of rental income for the nine month period that we had received given the demerger was affected in that last quarter. So that’s how the 14. So the like to like comparison was between 14 and the current quarter. That’s why we changed that 18 to 14 just to make sure that it is a like-to-like comparison, but the actual number will still remain 18%. If you include the 65. So hope that clarifies the revenue part.

So if you see up till now in the earlier construct. We would be seeing something called Revenue from Contracts with Customers which included, which did not include some of the operating income, which is the line item. If you would see called other operating revenue. Now just to avoid that confusion and to take the entire operating income into account, we started disclosing the revenue from operations as the total revenue. That’s the difference that you’re seeing. Again, there is a note on this regarding the presentation as well.

Saurabh — Ambit Capital — Analyst

Understood. And sir, if I may continue asking questions, so I have a few. Couple of questions as well. Regarding the wiring harness business so as addressed in the presentation, it says that we have developed to some high voltage solutions for electric vehicles. So if it if it is possible for you. Can you please elaborate more on the product and when will we start commercial production for the same.

Laksh Vaaman Sehgal — Director

These are the high-voltage wiring harnesses required for electric vehicles and these are now already in, SOP. One of the customers for some, they will be coming into soon.

Saurabh — Ambit Capital — Analyst

Okay. And sir, there was some business question as and just want to get some clarity on the business part. So as we know that there has been increasing focus for weight reduction and an in order to accommodate higher mileage. Right. So basically, so with increasing features premiumization electrification. We all know that the wiring harness content is expected to rise exponentially. Right. So in order to fit higher gardening a wiring harnesses content into an EV where there is a requirement for lower weight. So how is an industry RV trying to solve this problem are we coming up with improved technology or is it possible that we might come with alternative solutions.

Vivek Chaand Sehgal — Chairman

In this Pankaj, if you can answer that but I would just like to add one thing that These are new technologies, which are available with us in the commercial vehicle side in the passenger vehicle side Sumitomo is also a great feature in this particular case, we have multiple options but Pankaj explained

Pankaj Mital, — Chief Operating Officer and Whole Time Director

Sure sir. Also, not just into the wiring harness but what the carmakers are looking at it as lightweighting the whole vehicles because it’s understood that when EUV come into play. There are more batteries, which are coming into the vehicle, which adds to the weight and also these much more figure wires, for charging connections. So while the adjusting more and more circuits into the vehicle. There have been more and more compacted cables and other electronic solutions, which have emerged over a period of time, which we already support our customers with, but also our polymer division has done a lot of work to lightweight, the products which we have been supplying. So it’s on the overall vehicle side, if you look at it, that’s how the carmakers approach.

Saurabh — Ambit Capital — Analyst

Got it. I have a few other questions as well. But I’ll fall back in queue.

Operator

The next question is from the line of Chirag Shah from Edelweiss. Please go ahead.

Chirag Shah — Edelweiss — Analyst

Thanks for the opportunity. Sir, just one question I had in the standalone business. If you look at it, there is a sharp jump in raw material to sales so is it an ideal sequentially. Also there is a significant jump. So, is it purely because of pass-through arrangement or this is, this is a steady state number from mix perspective, if you can help us understand

Vivek Chaand Sehgal — Chairman

So Chirag that’s what I’m trying to say there are so many moving parts that the customer needs needs to be satisfied their auditors there is costing people and all that they need to be satisfied. So the work for our companies is huge and that’s what we did is, whatever factual numbers that are given to you. We have not made any provisions for peak. The amount that the customer has asked us to have agreed to so till the money comes in. We will not accept that. So maybe in the coming quarter. The one, two, three months up ahead. We are going to be in a better position to recover all the costs but Pankaj you can probably answer this question for all of us, maybe

Pankaj Mital, — Chief Operating Officer and Whole Time Director

So Chirag you’re talking about higher material costs and consolidated level or standalone level

Chirag Shah — Edelweiss — Analyst

In standalone business. So I presume it could be either because of the mix which or lead lag because of the pass-through arrangements with BOE and there would be some lag effect I just wanted to understand what is the driver of the sequential sharp jump.

Kunal Malani — Chief Financial Officer

Maybe I’ll give you a little a flavor Chirag number one, when you are looking at it from a historical perspective Specifically quarter 4 of last year, you should adjust the income levels for the one-offs that were there. The INR65 crores that we spoke about the rental income that came and hence that’s artificially depressing the raw material cost on total revenues if to look at it. The second, as you rightly said, there is a path arrangement on the wires business which has a lag effect and as the copper, especially in the light of funds came down that lag effect will take into account only next quarter.

Chirag Shah — Edelweiss — Analyst

Okay. Secondly, sir. Slightly broader question, especially from demand in Europe. Any thoughts given the wage inflationary pressure and the various media articles that indicate at the end consumer level there seems to be some pressure coming across, because some of the other companies who are exporting to Europe indicating some kind of destocking undertaken at district the dealer level. So any communication. We are getting from your venue customer about potentially slow down for a wonderful quarter on volumes side or there would be a volume

Vivek Chaand Sehgal — Chairman

As far as our information and our reports go, there is a marked improvement from April to June June numbers are ready phenomenon all over the customer doesn’t give you kind of a letter telling you what is demand is actually working on the electronic they seems to the kind of push that we’re getting from the customer for demand is huge. So I do not know how to answer that question for you. Well, our seeing is that the numbers are very robust. The demand is very strong. I do not know what the other companies. You’re talking about, that’s their problem. But we are getting a very strong demand, basically Kunal. If you want you can add to that.

Kunal Malani — Chief Financial Officer

Just one, but you may want to just assess this from the pipeline of production that we saw in the month of April to June, which highlights the strength of the demand. I’m presuming the OEMs only producing if the demand is not looking like. I understand the inflationary pressures. But as of now with whatever the insights and that we have from our OEMs. We are not seeing any decline on demand side.

Chirag Shah — Edelweiss — Analyst

This is helpful. Thank you very much. And all the best.

Vivek Chaand Sehgal — Chairman

Thanks. And this is the highest ever you’ve done in the quarter. We would have been last saying is true, but on other numbers that doing the talking.

Chirag Shah — Edelweiss — Analyst

Thank you very much.

Operator

[Operator Instructions] The next question is from the line of Dhawal Doshi from Pinpoint Asset Management. Please go ahead.

Dhawal Doshi — Pinpoint Asset Management — Analyst

Hello, sir. Can you just, just provide us some insights amount what is the kind of pass-through, which is still pending. As you said you’re working with the customers and you’ve got certain approvals but till the time we don’t get that we are not likely to book, can we get some sense in terms of what that quantum could be how material that amount could be and how do we see things going forward in terms of given coke prices have corrected. So that’s once again will start reversing right. So just wanted some sense about the overall quantum for this.

Vivek Chaand Sehgal — Chairman

I can understand that you would like to know some numbers over there, but that would be forward-looking statements and we can make that. So keeping ourselves under the guidance of what SEBI and all the big guys tell us to do so that’s why we have been kind of Mercantile accounting if the money is in the bank has we taken into our books. But yes, we are discussing with all the customers negotiating, they are of course offering certain numbers, which we may not be happy with. There are certain number, which we think they should give more they should take significance of certain things in that area, which are relevant to our, so really very difficult to quantify. I can give it to you. And also I think by law, we are not allowed Kunal. Can you help me out on that.

Kunal Malani — Chief Financial Officer

As you rightly said, we can’t give you a view on the exact numbers and they are being fairly conservative about it is, what I can tell you. And Mr Seghal was mentioning, want to make sure all of this is a well-documented written form cash to see the sector before we to book any of these. But given our discussions that have been occurring. We are at least positively inclined towards it and hence, we feel comfortable that we should see improvement going forward.

Dhawal Doshi — Pinpoint Asset Management — Analyst

So at least in terms of timing, can we expect this to happen in the current quarter.

Kunal Malani — Chief Financial Officer

Look, can’t predict in Delhi.

Vivek Chaand Sehgal — Chairman

We are trying our best, but just have a little bit of thought for our teams. The marketing guys, the finance guys with so many issues and of course for them, they would like to have the money into our banks as soon as possible so that they can book it, but please bear with us. We can’t really make any statements on that.

Dhawal Doshi — Pinpoint Asset Management — Analyst

Thanks a lot, sir.

Operator

Thank you. The next question is from the line of Arvind Sharma from Citigroup. Please go ahead.

Arvind Sharma — Citigroup — Analyst

Good evening, sir. And thanks for taking my question. Just one question on the segmental revenue for the standalone business. There is a big wiring harness Jeremy to elaborate exactly. What are the consequence of the semi market 61 crores.

Kunal Malani — Chief Financial Officer

I’ll paraphrase and correct me if I heard it wrong. You’re asking what is the wiring harness and stand-alone

Arvind Sharma — Citigroup — Analyst

Right. Sir, the wiring harness resin standalone what are the consequences.

Kunal Malani — Chief Financial Officer

So when we demerged the the domestic wiring harness business, it still retain the export business, which is there in as well as the wires business which is there in

Arvind Sharma — Citigroup — Analyst

All right. Is there any revenue is inter-party transaction between and medicines, barring some business

Kunal Malani — Chief Financial Officer

That is right. There would be buyers that would be moving between simul and MSL, for which we had sold the shareholder approval as well as you know

Arvind Sharma — Citigroup — Analyst

Sir. Is it possible to share that quantum.

Kunal Malani — Chief Financial Officer

It’s that as part of this year [Indecipherable].

Arvind Sharma — Citigroup — Analyst

Thank you.

Operator

Thank you. The next question is from the line of Hitesh from CLSA. Please go ahead.

Hitesh — CLSA — Analyst

Thanks for taking my question. Kunal. My question is on this, just wanted to clarify again because of the reporting in wiring harness we have this export business out of India MSW while 100% consolidation and BKC right and then you are netting it off the wiring harness MSW stake from the, from the lessons from them removing that from the JV piece. Right. So that is how accounting is done right, am I right

Kunal Malani — Chief Financial Officer

That is right. So it will include also our businesses that we have in other parts of the world, which we’re all lying in others. As I mentioned earlier, which included our US agricultural equipment business under and WFSI our Middle East business and so on, so hence, those are getting reclassified from others to wiring harness as well.

Hitesh — CLSA — Analyst

Okay and in modules business we have S&P plus India Polymer business right

Kunal Malani — Chief Financial Officer

Plus, there are other international business. As I mentioned in other parts like Czech Hungary, et cetera, which was at 100% again other it was lying in others whichever then moved into module and pulp

Hitesh — CLSA — Analyst

And sawmill would be largely, right. That’s how we will look at

Kunal Malani — Chief Financial Officer

That’s right.

Hitesh — CLSA — Analyst

So that’s the breakup. Right. Can you give us more clarity how should we look at the others the sawmill piece of revenue. Right, I mean from a perspective of next two, three years, because this is like something which we don’t have any clue. I mean, we will keep on doing acquisitions and maybe growing this revenue and this is becoming an important piece that. So can you give some color on how should we look at this segment and how you’re trying to scale it up.

Vivek Chaand Sehgal — Chairman

If were looking at slide 22, 23. We’ve given you a little bit of flavor of what others contain among the many divisions. We’ve given you a split of how this is across these divisions lighting is the largest division constituting around more than 40% of the 1600 odd crores that is there and in others. It continues to have very strong order growth. It’s the largest LED player and it’s. So one of the few, which has been able to cater to creating unique products, both on the shock absorber as well as on the electronics and Lighting piece for the EV segment in India.

So, the business continues to go from strength to strength and that’s how you are seeing both the growth on the topline and bottom line and the other segment where lighting has a fair amount of share to contribute. Similarly on the precision and last normal side the last number has an inherent advantage in India and there is a fair amount of export potential that we are trying to tap into, we should see again a decent amount of expansion on that business going forward and interestingly even beyond automotive we seem to be getting a good amount of traction on the non-automotive side as well.

Aerospace where we’ve announced they are close to completing the acquisition of tools on April 6 when we announced this transaction, the order book was 1500 crores today The order book is about 2,500 crores. So that’s a 70% increase in order book and that is what we had anticipated. That was the purpose of this acquisition where by bringing medicine in together with the same promoters, we should be able to position the business much more differently in front of the customers and that’s what got achieved and directionally that’s how you’re seeing the order books fill up.

And then finally on the technology piece, which was an internal piece and up till now where we are trying to now expand those revenues to non-group side. Year-on-year. You have seen a doubling of revenues. So are some of the key highlights at least for these divisions. And our view remains that we should be able to see significant amount of growth given there is a large amount of untapped potential in many of these divisions. Also from an acquisition perspective just the knowledge of these would enable us to, look at many opportunities in this space.

Hitesh — CLSA — Analyst

Okay, thank you. And finally on capex, can you give us the consolidated capex for this year and how should we look at debt number, I mean this quarter it has gone up because of working capital, but will there be release of working capital in second half, can you shed some color on that.

Vivek Chaand Sehgal — Chairman

Yes, I think our focus has always been to be debt free but Kunal whatever we can share. Please go ahead.

Kunal Malani — Chief Financial Officer

So you would look at the current capex for the quarter just about 350 odd odd crores which is sizably lower than what we have typically expanded and that’s part of what we had done to make sure we’re keeping our liquidities and keeping our business type the volumes there were erratic and volatile and hence we decided to conserve capital. Our guidance as we had given last time around was 2500 plus, minus 250. We want to keep the guidance where it is given at least we see that the next few quarters, could be strong from a production perspective as some of the supply chain issues ease up.

So we are keeping the guidance where it is right now, obviously will calibrate is calibrated as you saw in this quarter as well, depending upon how the actual volumes throughout. On the working capital side, you’ve seen the debt expand on account of increase safety stocks inventories etc. that we have to keep much depends on how the supply chain plays out right now. The demand is there and customers have been asking us to keep the safety stocks in place just to make sure we are able to supply the material in time to the customers.

Obviously as the supply chain situation recedes we should see some amount of working capital decrease and hence decline and the related debt associated with it, but difficult to frankly predict when where. How it will happen, but we are carrying additional working capital and hence additional working capital debt on that count at some point for sure has to normalize when is an unknown animal.

Hitesh — CLSA — Analyst

Great, thank you.

Operator

[Operator Instructions] The next question is from the line of Jinesh Gandhi from Motilal Oswal Financial Services. Please go ahead.

Jinesh Gandhi — Motilal Oswal Financial Services — Analyst

Hi, I have question regarding wiring harness business. So just a clarification given that now. We didn’t get BKC is separate performance so issues which BKC faced in last few quarters regarding meeting higher expenses due to meeting customers. We launched project is that behind us, and the 7.9% EBITDA margins for the quarter without such expenses, if you can clarify on that.

Kunal Malani — Chief Financial Officer

Sure, I’ll let Pankaj take the credit for that, but I want to also inform you guys as you have seen the annual report in the web. We have opened our manufacturing and quality control plant in Hamamatsu first directly now supplying this is exciting Japan that has been covered in our annual report but Pankaj go ahead all credit to you the BKC improvement go head.

Pankaj Mital, — Chief Operating Officer and Whole Time Director

Yeah Jinesh all the ramp ups, which we were doing, there have been a smoothened out and we continue. So as we had said that there were two customers whose ramp up come together. One of the customer example completed and other customers ramp-up will continue as more and more modules get added to it.

Jinesh Gandhi — Motilal Oswal Financial Services — Analyst

Okay. So this quarter there is hardly any there will not be much impact and because of that.

Pankaj Mital, — Chief Operating Officer and Whole Time Director

See, this is a consolidated number. So when we look at the consolidation it has gotten consolidation of all it’s the company’s 100% businesses as well as all the joint ventures and so if you look at it on an overall basis to three macro things is, of course there has been inflation for which we have had a mixed successes so far like Mr Sehgal mentioned that we can book till we finally achieve our goal, which we believe should be the right thing to do, as to how much. So that’s mitigation through recoveries from customers has happened to some extent, but then this is a very important work in progress.

There have been like for what we export from India you in this quarter, currencies like the yen and euro depreciated and also China is still the Q1 was heavily impacted because of COVID as well as the commercial vehicle industry was weak. It was coming through recovery but Q1 became even further impacted so few factors which are there more or less otherwise seems to have gotten really very all across because we know that there have been so many challenges to the whole industry with material suppliers and other things that start to stop volumes up and down, mix changing and the most important thing for us is to satisfy our customers demand and continue to keep improving.

Jinesh Gandhi — Motilal Oswal Financial Services — Analyst

Just a clarification on what Mr Sehgal talked about setting up plant in Japan. So this is for wiring harness to Suzuki is that water to start or for PVC.

Vivek Chaand Sehgal — Chairman

Well so these are very light commercial vehicles, which will be manufacturers there as you would. Remember, we had started exports to them because of supply chain issues, which were happening and then that was a time when support was soft. So we manufacture these in India and export them now directly to Suzuki

Jinesh Gandhi — Motilal Oswal Financial Services — Analyst

Got it. Thanks a lot.

Vivek Chaand Sehgal — Chairman

Jinesh just a, just a point. We started with technology from Sumitomo in Japan, but it to India, they’re all over the world now. It was great pleasure and honor that we could with Sumitomo knowledge come into Japan start supplying from that. So it’s a kind of a full circle there

Operator

Thank you. [Operator Instructions] Next question is from the line of Ronak Sarda from Systematix. Please go ahead.

Ronak Sarda — Systematix — Analyst

Hi, I have a question on the reporting Kunal if I have to understand. Now, what would be the standalone wiring harness profitability, so that is difficult to diagnose effort from the presentation right because the overall wiring harness revenues which you have shared. And if I remove the JV Part of it. The eliminations that won’t be the right way, because it would include multiple JVs, which are beyond the wiring harness division so I’m referring to the slide 24

Kunal Malani — Chief Financial Officer

So if you’re referring to Slide 24, that’s on a consolidated basis for I thought you referred to something on standalone you said so standalone profitability is there in the Clause 41

Ronak Sarda — Systematix — Analyst

So that’s the revenue and EBIT which I which I have for the standalone business.

Kunal Malani — Chief Financial Officer

That’s the revenue and EBITDA

Ronak Sarda — Systematix — Analyst

Sorry. Where should I look for this number. Revenue and EBITDA, plus 41 in

Kunal Malani — Chief Financial Officer

The segment reporting the standalone

Ronak Sarda — Systematix — Analyst

Okay. Yeah. Total EBITDA. And, and for, let’s say, if I go back, go back to the slide 24 breakup. When we remove the JV is consolidated by the equity equity method. This would include, now the Mitsumi rising last multiple JVs, which would, we would have in the Vision system and your China JVs in the SMR and SMP business as well. And some of the sawmill businesses.

Kunal Malani — Chief Financial Officer

Yeah, absolutely.

Ronak Sarda — Systematix — Analyst

Okay. And when we say EBITDA is net of intercompany transaction pure profit of those entities

Kunal Malani — Chief Financial Officer

That’s right.

Ronak Sarda — Systematix — Analyst

Okay, that’s it from my side. Thank you.

Operator

Thank you. [Operator Instructions] As there are no further questions from the participants. I now hand the conference over to Mr. Vivek Chan Sehgal for closing comments.

Vivek Chaand Sehgal — Chairman

Thank you. I think if it helps. What we have done this, we have booked all our expenses, all this is done, the number that we just come back from the customers for this period will actually go straight to the bottom line, and that is why we feel that the future is good, strong and the numbers are only going to get better. We believe that the demand is very robust. Our customers are time and again ensuring that we guys are focusing on what is important and that is to be on not to supply to them what to meet these matters of price negotiations, and getting all the instruments and all that is a matter of time, which we would rather make sure that it happens earlier than data. But with that, I think…

Operator

Ladies and gentlemen, the line, from Mr. VC Sehgal has got disconnected request you all to please stay online while we reconnect them. Thank you.

Ladies and gentlemen, thank you for patiently waiting, over to you, sir.

Vivek Chaand Sehgal — Chairman

Thank you very much. Actually I was going to hand it back to you and if no more question, we are okay, thanks a lot. Thank you very much, and please stay safe and healthy.

Operator

[Operator Closing Remarks]