Steel Strips Wheels Ltd. (NSE: SSWL) Q4 2025 Earnings Call dated May. 16, 2025
Corporate Participants:
Unidentified Speaker
Naveen Sorot — Chief Financial Officer
Analysts:
Mumuksh Mandlesha — Analyst
Gautam Rajesh — Analyst
Saurabh Jain — Analyst
Ritesh Gandhi — Analyst
Aditya Khetan — Analyst
Kedar Kailaje — Analyst
Jyoti Singh — Analyst
Saket Kapoor — Analyst
Karthi Keyan — Analyst
Ankur — Analyst
Presentation:
Operator
Ladies and gentlemen, good day, and welcome to the SteelStrip Wheels Limited Q4 FY ’25 Earnings Conference Call hosted by Anand Rathi Shares Stock Brokers 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. Mumuksh from Anand Rathi. Thank you, and over to you, sir.
Mumuksh Mandlesha — Analyst
Thank you, Sagar. Good afternoon to everyone on this call. On behalf of Anand Rathi Shares and Stock Brokers, I welcome you all to Q4 FY ’25 earnings conference Call of SteelStrips Wheels Limited. We are pleased to host the senior management of the company.
Today, we have with us Mr Diraj Garg, Managing Director; Mr Naveen Sorat, Chief Financial Officer; and Mr Pranav Jain, Deputy General Manager of Finance. We’ll start the call with the initial commentary from the management and then we’ll open the floor for the Q&A.
Now I hand over the call to management team. Over to you, sir.
Unidentified Speaker
Good afternoon, everyone. I hope everyone is doing well. I hope everyone had an opportunity to go through the financial results and investor presentation we just sent out this morning.
So let me start with Q4. Q4 FY ’25 has been a standout quarter for SSWL. It has grossed the highest sales ever in our history. And this is also the quarter where we had two months of back-to-back highest-ever monthly sales. And so quarterly revenues reached INR1,233 crores, up from INR1068.7 crores in the previous year, same quarter, reflecting a growth of 15.5%. EBITDA stood at INR134.5 crores, representing a 21% growth Y-o-Y.
Profit before-tax has grown from INR67.8 crores to INR83 crores in this quarter, which is a growth of 22.5%. I think this is a key metrics people should look at because there were tax anomalies in the last year that probably reflect a lower net profit this year. But that is the quarter — this quarter’s net profit has come to INR61.7 crores, slightly higher than INR60.4 crores last year. This modest PAT growth is primarily due to the transition to the tax — new tax regime, wherein tax payments for the previous 3/4 of FY ’24 were deferred and accounted for earlier.
On the export front of the quarter, we witnessed a significant revival, especially following the conclusion of the US elections, which brought stability and clarity to one of our key international markets. Export revenue grew by 22%, rising from INR129 crores to INR157 crores in this quarter. So basically in this quarter, we’ve had exceptionally high sales in exports. In fact, all the — all the segments of our business have stood out in this quarter.
Coming to the full financial year, in terms of revenue, it has been flat and this was anticipated and communicated in previous calls and this primarily reflected a slowdown in the Indian domestic market in the first-half, especially in the CV wheels. And the CV wheels was a big sales growth reason why 2024 — 2023, ’24 had its highest sales. So it was an exceptional year the previous year, but this year in the first-half, it sort of reduced and that really brought our growth down. We had a growth — negative growth of 3.5% in the CV segment. So this is the only segment that caused us to have a flat sales growth. Had it been a good growth number, we would have done much better than what we are showing this year so-far. So despite these external headwinds, the company has recorded revenue of INR4429 crores, INR4,429 crores, reflecting a modest growth of 1.7%.
Our EBITDA for FY ’25 stood at INR486.8 crores, marking an increase of 4.6% year-on-year. Notably, EBITDA margins improved by 30 basis-points, arising from 10.7% to 11%, supported by our continuous focus on higher realization business like alloy wheels and exports and tractors. They’ve all done well. It’s barring the small degrowth in the CV sector. On the debt side, we’ve been able to reduce our long and short-term debt by INR193 crores. And this has — this has happened in-spite of the fact that we undertook some capital expansion for our brownfield expansion in aluminum wheels and knuckles. In-spite of that, our debt has come down.
And so-far as the profit-after-tax is concerned, the profit-after-tax in FY ’25 stood at INR210 crores compared to INR219 crores last year, INR220 crores almost last year. This margin decline is primarily attributed to higher finance costs and increased depreciation. So depreciation has increased by around INR15 crores and interest cost has gone up by INR10 crores. The increase in depreciation is because of higher capital expenditures for the expansion of capacity across facilities. We have expanded our facilities in Jam. We have expanded our facilities in Masana and we’ve also done some brownfield work-in our facility. Our finance cost going-forward is going to go down because the debt — is a reduction in debt as well as transmission of reduction in repo rates.
Coming to the Alloy Wheels segment, this year we had a revenue of INR1436.5 crores, which was by — from a volume of 33 lakh units. This is up from 30 lakh units in the previous year. So this has been one of the main reasons why our margins have improved this year. And we continue to remain very optimistic about this segment. In fact, we hope to do a double-digit growth this year in the alloy Wheel segment. Tractors again was our best-in the tractor segment. We had annual sales volume exceeding 17 lakh units.
And so going-forward, we still — we also continue to feel that there will be growth this year, maybe in single-digit, but last year we grew about 16%. So maybe this year will grow sub 10%, but still a solid growth over a very solid base. I already spoke about the CV segment. The CV segment showed a decline of 3.5% and that’s the only reason why our sales growth did not perk up as much as it should have. Exports again were a late riser, just like the CV segment.
In the second-half, we experienced better export volumes and especially after the conclusion of some kind of a trade war that’s undergoing at the moment right now, but still we’ve got relief on that front. And this year, we did a turnover of INR561 crores and this of course, is less than last year, but due to various factors like geopolitical factors, mainly with tariffs, but also some market-share competition that sort of — although we expected this to be in the same range of INR50 crores to INR600 crores, but I feel that we will do much better going-forward. Now given the fact that there is a lot of clarity on tariffs at least for the foreseeable future, for at least for the next 120 days, there is clarity and perhaps beyond.
Lastly, I would like to touch upon the Knuckles business that we started this year. This year, we’ve been able to generate a revenue of INR11 crores and at the moment, we are running at a capacity utilization of about 70% given the expansion that we did of 2.5 lakh units. And we hope to reach 100% in this whole year. I think we should be very close to 100%. In fact, we would be looking to augment our capacity and that I can speak to you in the question-and-answer session.
So that’s it from my side, we can start the Q&A.
Questions and Answers:
Operator
Thank you very much. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star than one on their touchstone phone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. Again, to register for a question, please press star then 1.
Our first question comes from the line of Gautam Rajesh from Everflow Partners. Please go-ahead.
Gautam Rajesh
My first question was, are you seeing any changes in-demand in exports with duties imposed on China being higher than that of India? Is that resulting in better traction for you?
Operator
Sorry to interrupt. The management was not able to hear you properly. If you can just…
Gautam Rajesh
Yeah. Yeah, yeah. I will do. Yes. So are you seeing any change in the demand scenario in exports with more duties being imposed on China than India? Is that resulting in better traction for you?
Unidentified Speaker
Okay. So I will try to answer this question very comprehensively. And I’m sure other people have similar questions or different questions for the same in the same subject. So what has happened is India has a reciprocal duty of 10% in addition to what was there earlier, earlier it was 3% that still remains. There’s 10% added down to Indian exports. Whereas our competition, Vietnam and Thailand have duties at 36% and 46% respectively. So we have a notable advantage assuming — assuming — so let me correct myself. So right now, it’s 10% for everyone.
But going-forward, going-forward, the duties of Thailand and Vietnam are going to be higher than India. That is our assumption and belief and that’s what our customers are telling us that they’re shifting business to us because they anticipate higher tariffs for Vietnam and for Thailand. So earlier when the tariffs were announced, we had an advantage of, let’s say, 10% with Vietnam and 20% with Thailand. But now — but now since America has reduced duty to 10% for everyone for 90 days. Even then when we have the same duties, going-forward, the customers are aware that Vietnam and Thailand will be taxed at a higher-rate than us.
So that is our belief that we will continue to enjoy a competitive advantage over Thailand and Vietnam. Vietnam in the customer’s wallet share. So that we are very confident on. But of course, we’ll have to see maybe the duties on India will get reduced further from 10%, that will again be a bigger help for us. So we are very confident our biggest market in America is safe vis-a-vis or competition. But I also must like to add here beyond tariffs that we are seeing very good traction in Europe for our business. And that is because of our competition in Europe coming under financial strain and bankruptcy.
So we are seeing a lot of traction from the OEM side in our CV exports as well as passenger car wheel exports for steel as well as well as aluminum in Europe. So going-forward, we are very hopeful to have a very robust order book and we are hopefully going to target INR1,000 crores exports in the next financial year. It’s not this financial year, but next financial year, we should be all set to cross INR1,000 crores in exports, let’s say, one year-one year from now?
Gautam Rajesh
Okay, sir. And sir, my next question was, is the EBITDA margin revision from the legacy contracts that you have earlier spoken about largely done or is that — is it expected to come through over the next few quarters as well? What sort of margin profile also do you see — do you expect going ahead?
Unidentified Speaker
Okay. So if you recall, this year — last year our EBITDA per wheel was 253. And this year we have closed at 261. And if you look at the 4th-quarter, it’s at 270. So it’s about a 15% — it’s about 5% increase if I — how much was increase was ought to be? 17 minus 253 so it’s a 7%, 6.5%, 7% growth over last year in the 4th-quarter. So I think that’s an indication to everyone that our margin profile is going to increase. For the whole year, it’s a 3% increase.
But if you look at the 4th-quarter versus the year before that, full-year before that, 2023, ’24, there is a 6.7% increase in EBITDA percentage per wheel. So going-forward, I think 270 is a new norm for us and anything about INR70 should happen maybe in the third or 4th-quarter. So I think for the whole year, I don’t want to give you a number, but it will certainly be a very healthy number.
Gautam Rajesh
Understood. And regarding the legacy contracts, do we —
Unidentified Speaker
Have been negotiated — renegotiated with one of the big OEMs in India. And going-forward, whatever quotes we are making for new businesses, the margin profile is much superior because there is a consolidation globally now. I mean, there are a couple of companies closing down in Europe and Europe is certainly going to have a vacuum. And we are very well-positioned because of our legacy history with the OEMs in Europe and that is helping us increase our export business going-forward. That’s what I’m saying.
The financial year, let’s say, ’26, ’27 should see a INR1,000 crore top-line in the exports. And this is all coming with a higher-margin — and the profile of the margin is going to increase in our case. And also domestic. So all the domestic businesses that we are quoting that are going to come into play from, let’s say, 2026, ’27 onwards, they are with remarkably different margins. This I’m talking about Pass car steel wheel, which is majority of my business. Business. Majority of my business is Pascar steel wheels domestically, domestic Pascar steel wheels and that is going to see a complete change, a very good change, very positive change on the margin profile.
Gautam Rajesh
Yeah. And sir, you won’t be able to that? Can you?
Unidentified Speaker
I won’t, because we have to — we haven’t calculated what the weighted-average EBIT margins would be going-forward, but they will be — you will see a number close to 300 plus when we talk about 2026, ’27.
Gautam Rajesh
Okay. Yes. Okay. Thank you.
Operator
Thank you. Participants, you may press star then one to ask a question. Our next question comes from the line of Saurabh Jain from Sunidhi Securities. Please go-ahead.
Saurabh Jain
Many congratulations, sir for the wonderful set of numbers. And I have a few questions. So you mentioned the tremendous growth opportunity we are looking at from exports and alloy wheels also. So would it be fair to assume that we can definitely grow in double-digits for next couple of years looking at the recent trend, especially steel wheels have also showcased a good growth in Q4. And you know, the base was also low in the first 3/4.
Unidentified Speaker
So I think it’s a great question, sir. You know, this year, we are forecasting at least a 15% growth. And now the year-after that would definitely be in double-digits. I cannot quantify yet whether it would be 20% or whether it would be 25% or 15%. So anything between 15% to 25% should be the new normal for this company going-forward in the next foreseeable three years. So we are very bullish because we have a lot of traction in all our businesses. In fact, the CV segment have been talking a lot about it that the first-six months, first-nine months or first eight, seven, eight months were a real dud, but the last six months or four months, I mean, they have been tremendous.
In fact, our CV sales are the second-best in the whole history of the company. So I really don’t see any other — any segment going down in our portfolio. We have pole position in the EV two-wheeler business. That’s also a very good business for us and we are perhaps the only one having such a market-share maybe more than 80% market-share. Exports, as I told you are already growing to INR1,000 crores next financial year. The CV business, we feel that will show growth from what we are hearing from our customers like Tata Motors and Ashok, they are extremely bullish. In fact, this one should see our highest sales ever in the CV segment. So I mean if all the good wipe that we are getting from CV, from tractor, from exports, from alloy, from Knuckle, from EVs two-wheeler, I could have asked for a better setup for my company.
Saurabh Jain
Great. That’s helpful, sir. And to touch upon, you have already mentioned that EBITDA per wheel, we have reached INR268 in the last quarter. And at the same time, I was looking at the realizations, realizations except steel wheels, alloy wheels and exports have gone up really well, like on a Y-o-Y basis in Q4, alloy Wheels realization was up 21% and export also was up around 7%. So, but at the same time, gross margins were down from 34% to almost 33%, like almost 100 basis-points of you know contraction was seen in gross margin. So and probably that’s why there was like flat EBITDA, how do you see gross margin going-forward? I think over the next couple of years? Yeah.
Unidentified Speaker
Yeah, gross margins are also kind of a double-edged sport because then the prices of aluminum go up, they start looking lower. And when the prices go down, they start looking better. But I can tell you on the general observation of this business that this business is getting competitive, but we have been able to win all the main businesses, barring. We just got an entry into Maruti. But if you exclude Maruti and Toyota in this whole discussion, we have got all the new models and all the new businesses and they are — and they are at prices that weren’t — want at such competitive — such excellent EBITDA value that they were five years ago or four years ago. Of course, they have come down, but we are able to operationalize higher capacities, which results in stable EBITDA margin.
So I wouldn’t sort of go out on a limb and tell you that we will have better margins in aluminum wheel business. I think the margins in the aluminum wheel business have peaked, but for the next leg of business that we’re doing in the export market. So that will be the leg-up that you will see in 2026, ’27. In fact, this year itself, we will start exporting a lot of wheels to the European market. And — but the full — the next filip in this business, aluminum — alloy wheel — wheel business will come in 2025 — ’26, ’27. But this year, the margins will increase from last year.
So I’m answering a very specific question, the margins in alloy will increase from last year, but on — with a small — small increase. But yes, margins are not the same that they were five years ago or four years ago because there has been no competition, but luckily, we have been able to beat all competition. And in fact, grow our market-share. Every year we are increasing our market-share. But it has come at a slight cost, but that cost is negligible compared to the growth in volumes and now the positioning we have in the exports market. So I will talk about this more in maybe next quarter’s call once all these flows start moving into the European market.
Saurabh Jain
Got it. So that explains the EBITDA. Realizations at these levels of INR4,700, INR4,800 are is sustainable?
Unidentified Speaker
This is a function of aluminum prices. We have not much to say in this. Every quarter adjusted. If you can look at global aluminum price trends, you will get an idea as to why this is changing. Got it. And also you have to realize that the weight of the wheels has gone up. The weight of the wheel has gone up. So what we were doing earlier when we started the business was at 15 inch wheel. Today, the average size is 17.5 inches in our portfolio. And the bigger the size, the higher the weight. So the value of the wheel will go up in this regard.
Saurabh Jain
Right, with the share of SUVs, UVs going up, so this is likely to go up only.
Unidentified Speaker
It’s a new norm bigger sized wheels.
Saurabh Jain
And yeah, sorry.
Unidentified Speaker
Go-ahead.
Saurabh Jain
So I was looking at-the-market share. Of course, you have talked about CV segment, but in MHCB, our market-share has — during the quarter has come down from — come down to 54% from 61% and OTR also has come down from 70% to 35%, although it might be a small thing or — but can you explain which are the customers dropped or added? Because in two-wheelers, we have increased from 30% to 37%. So just — I was looking at the share of businesses from Ashok and Tata Motors also, it has come down our share of business. So can you just explain what has happened?
Unidentified Speaker
I think there is some error in your competition. I think overall, the OTR business has come down because we — the production of equipment that we don’t supply into has gone up. So for example, we don’t do the chained — chain equipment that JCB makes and they don’t use our kind of wheel. But the segment in which we operate in, the segment which we operate in, we are maintaining a share of business. In fact, we would have increased it marginally. But on an overall picture, it’s because of the product mix that the customer in the OTF segment that you find this drop.
And with regard — and with regards to real heavy commercial vehicles, I — our share of business — our share of business has been more than two-thirds of their spend if you average out. So I don’t understand why — why we see a number in decline in MHCV because I have increased my share of business in also. So — and, I have increased over the previous year. So I don’t see why we are seeing a decline in your books.
Saurabh Jain
Sir, it is mentioned in our presentation only and after a long, long-time there has been a change in the market-share in MSCV and we have shown a decline in share of businesses and market-share as well. Anyway, yeah, you have kind of explained it. Just last couple of bookkeeping questions from my side. So payable days have gone up from 77 days to 96 days. So how do you think —
Unidentified Speaker
I would address anything, why don’t you take it on?
Naveen Sorot
So it is just a play of mix. So there is no — any changes from our end in terms of the payment days. This mix changes with respect to with whom we are lifting material as they determines the overall average. There is nothing specific that we have done on the payable side to make it increase. But if you look at overall in terms of working capital cycle, I guess we are still hovering around the same 50 52 in terms of overall days.
Saurabh Jain
It has in fact improved, yeah, but I was just looking at the payables. Yeah, got it. And any light on debt levels and capex for next couple of years for FY ’26 and FY ’27, what kind of capex are we looking at and any debt repayment plans or net-debt levels.
Unidentified Speaker
Okay. So this year — this year we have quite an interesting set of ideas to implement. And mainly they apply to the alloy wheel business, they apply to the knuckles business. And so we are — we are contemplating — evaluating expansion of our alloy wheel business. We are definitely going to increase our capacity in Knuckles. And so in the next two years, we have something about INR600 crores of capex intentions to cover alloy and knuckle.
Saurabh Jain
And that would be fully distributed in both the fiscals or how it is going to be?
Unidentified Speaker
Right now, as I said, we are in the evaluation process and our capacities are filling up from — and actually we are slow — a little bit slow to ramp-up our existing capacities and we have a lot of orders, but we are now implementing that expansion that we undertook last year, implementing that expansion that we took last year. So depending on how — how the market behaves, but yes, we are committed to spending this expansion in next — so I can’t give you a figure that —
Saurabh Jain
Got it, sir. That’s all from my side. Thank you and wish you all the best. I’ll come back-in the queue.
Operator
Thank you. Thank you. Again, if you have a question, please press star and one to join the question queue. Next question comes from the line of Ritesh Gandhi from Discover Capital. Discover Cap Capital. Please go-ahead.
Ritesh Gandhi
Hi, sir. Sir, just had a question. You know, when we look at, I mean steel wheels, there was really — I mean a few players there where we were able to gain a very strong market-share. As we move into alloy wheels, I understand EBITDA per wheel is higher, but obviously, the competitive intensity is also higher given the number of players competing is higher. So as the industry is moving away from steel to alloys. How do we see the potential implications of one higher EBITDA per wheel on the other share — on the other side, higher like competition for wheels?
Unidentified Speaker
So you’re saying that aluminum wheel business aluminum wheel gives you a higher EBITDA per wheel or on an absolute basis, that is correct, yes. And yes. So what is the — what is your point?
Ritesh Gandhi
No, the question was that is that while the EBITDA per wheel is actually higher, is there like comparative intensity higher where our — where our market-share in alloy wheels will be — will be lower. So if there is a shift from steel towards alloy, we may ultimately lose overall share. Is that accurate or am I looking at the wrong way?
Unidentified Speaker
So we won’t because overall, if you look at our volumes, our volumes have increased on an absolute basis, both aluminum and steel put together. So this year’s about ’25 volumes have been the highest in our history. So close to 1.9 crore wheels and which is probably the second-highest in the world as — so — and we foresee about a growth of close to 21 million-plus this year, so 2.2 crores and 10 lakhs. So — and the steel wheel business is also slated to grow in this process. It’s not that the steel wheel business is not growing. But yes, the steel wheel business is going to grow at 4% a year, let’s say. The aluminum business will grow at 12% for the industry. I’m talking about on an industry-level basis. So there is — there is cannibalization. There is cannibalization of — by the alloy wheel business into look into steel, but yet it’s the steel continues to grow also.
Ritesh Gandhi
No, but the question was if our market-share in steel is higher than in than in alloys, are we ultimately a net beneficiary of this move towards alloys? Are we neutral or is it slightly negative for us?
Unidentified Speaker
We are a net beneficial. You can see it in the results. You can see it in the EBITDA margins. It’s all because of aluminum wheels that we are able to more than offset the loss in the volume of steel wheels.
Ritesh Gandhi
Thank you.
Operator
Okay. Thank you. Thank you. A reminder to all the participants, you may press star N1 to ask a question. The next question comes from the line of Aditya Khettan from Institutional Equities. Please go-ahead.
Aditya Khetan
Yeah, thank you, sir, for the opportunities. Sir, my first question is onto the steel wheels volumes. Although, sir, we understand that the shift is largely towards the alloy wheels, but sir, the steel wheel volumes have seen almost a flattish volumes over the last, you can say three to four years. Sir, what is the outlook over there? Like the industry would be focused only onto the alloy wheel side or the steel wheels also like would be —
Unidentified Speaker
Yeah, yeah. So what has happened in the last few years, we have purposely dropped businesses that are — were not giving us enough margins to make money. And so that has happened. But going-forward, there is a realization in the industry that prices need to be corrected, the prices need to be corrected and it has started to happen. So as I said in my introductory statements that we foresee a great future in the steel wheel business going-forward with regards to EBITDA margins and we will continue to enjoy from a flattish growth to again flattish plus growth going-forward. So we are not — we are quite excited about this next few years. Starting from ’26, ’27, you will see a remarkable shift in the EBITDA per wheel. As I said, INR300 plus from 270 now. So we foresee that definite reality happening from support by the domestic steel wheel business. Besides the export —
Aditya Khetan
So this capacity addition of 65 lakh wheels into the steel side, what sort of volume growth you’re expecting for FY ’26 in steel wheels and for the alloy wheels also?
Unidentified Speaker
So I have told this in several other meat calls. So I — I will tell you again that acquisition of INR65 lakh wheels was a strategic move and it was meant — it was done at a very low-cost of INR140 crore. Out-of-the INR140 crores invested, around INR100 crores worth of equipment has been shifted to other factories. For example, I will tell you that we have been able to increase our sales by about 350,000 wheels — production by 750,000 wheels, which is close to INR160 crore INR170 crores revenue in by moving equipment from from the AMW facility.
So I don’t think one should read too much into that investment to get you more sales revenues directly from that factory. But yes, we will be utilizing that factory. It is part of our discussions to start with those facilities to make OTR wheels, but that is something that we haven’t given a green signal on. But of course, we can talk about it in the next call.
Aditya Khetan
Got it. Sir, just would like to know, is there any material difference in the cost structure between a steel wheel and then LOV? Like in terms of the raw materials, is there any specific difference which you can highlight?
Unidentified Speaker
Well, let me correct you — let me correct myself. This year, you know the domestic steel wheel business has grown by 3.5%. So although it is still flattish, but we are in this range of growing. So next question was whether what is the difference between aluminum and steel prices?
Aditya Khetan
No, sir, on to the cost structure, like what is the difference in the cost structure between a steel and alloy?
Unidentified Speaker
Cost structure of what? Capex or for manufacturing?
Aditya Khetan
Manufacturing — manufacturing cost.
Unidentified Speaker
About four times. It is about 4 times.
Aditya Khetan
It is about four times. Okay. Okay. And sir, on to the business, I believe you had given some numbers that we are looking for INR110 crores of top-line. Sir, what would be the market size for this business and what operating levels we are looking in FY ’26 and FY ’27?
Unidentified Speaker
So FY ’26, as I totally will be at 100% based on the investment we made-for 2.5 lakh. But going-forward, I think this market is an evolving market and it’s a growing market. And I can tell you that this is a new — a new era business for India because a lot of OECD countries are using aluminum knuckles. India is the reverse. So just like we saw that experience with aluminum wheels, we should see this same traction in aluminum knuckles. So you can figure out the market size. It’s going to be quite reasonable.
Aditya Khetan
Got it. Got it. Sir, just one last question. Sir, on to the — so geography mix for the full-fiscal FY ’25, the European Union share has been around 32% as compared to around 20% 25% over the last few years. So this jump is led by your increasing presence, increasing visibility, higher volumes or is it —
Unidentified Speaker
A decline in US? It’s a decline in US?
Aditya Khetan
Okay. But sir, the European Union like the — as a country as a whole, they are not on a growth path, like they are already on a declining phase for the last two to three years. So what has led to this growth?
Unidentified Speaker
So I think it’s a relative — I haven’t looked at the exact numbers, absolute numbers for Europe. One second. What is the exact number for Europe? What is the sales value? Sales. So it’s about flattish. It’s not really grown from INR160 crores INR178 crores, it has grown.
Aditya Khetan
Okay. Got it, sir. Thank you, sir.
Operator
Thank you. Participants, you may press and 1 to ask a question. The next question comes from the line of Kedar from Non Partners. Please go-ahead.
Kedar Kailaje
Yeah. Thanks for the opportunity. Am I audible? Come again. Am I audible? Hello? Yeah. Yeah. So my first question is pertaining to your market-share in steel and alloy wheels. So firstly, for steel wheel, I can see in your 2022 presentation that your passenger vehicle market-share for steel wheels was 50%, but in FY ’25, in your latest presentation, it’s 37%. So you have lost market-share or you’ve let go of that business or what has happened over there?
Unidentified Speaker
Our Head of domestic marketing can address this question with regards to all your name is Mr Sushil Gupta. Okay. Hello. Hello. Yeah. Hi, hello. Good afternoon to you. Yeah, good afternoon, sir. As far as this question which you have asked on passenger steel wheel, market-share, one of the reason is if you really look at it, there’s a lot of transition which is taking place from steel wheel to alloy wheel. Yeah, okay.
So what has happened is overall demand, I would not say it has come down, but our market-share come down is because there are programs which every five years, a program changes. So what will happen, you will see next year or very next year that I run two programs more from Maruti. So you will find this number going up. So it’s important. If you really ask me, there are only three players in the Indian market. So it depends upon if an OEM makes a rollover of the current wheel, the market-share of the existing player will go up. In our case, there are two programs where just their wheel RIM has been changed and the numbers will increase when the new model comes in. There is no such we have lost the business anywhere.
Kedar Kailaje
Okay. Got it. It. And in terms of alloy wheel market-share, I think it’s not mentioned in your PPD, but what is your market-share alloy wheels? And over the last two years, have you gained market-share and yes, then how much market-share have you gained?
Unidentified Speaker
You have definitely gained the market-share, exact numbers I can give you. We are in terms of this, if you really look at it, we — you want customer wise or you want otherwise, I can share it with you.
Kedar Kailaje
This overall industry level is also fine. I don’t —
Unidentified Speaker
Industry level we are at a market-share of 32%. No, sorry. 37% to 38%.
Kedar Kailaje
Okay. And what would be that number two years back.
Unidentified Speaker
Two years back this number was into Hamara what we have sold lakh. Overall market overall market percentage. I shall come back to you because we have gained our market-share, we have come down to, if you say three years back, it would be close to about 24% if you really ask me. Now it we are at 37%.
Operator
The next question comes from the line of Jodi Singh from Arihant Capital Markets Limited. Please go-ahead.
Jyoti Singh
Yeah, thank you, sir for the opportunity. Just one question on outside, like earlier mentioned INR600 crore capex. It’s in two years on aluminium business or overall, sir?
Unidentified Speaker
As I said very clearly, it is in the aluminum wheel business and knuckle business.
Jyoti Singh
Okay. Thank you so much.
Operator
Thank you. All participants, you may press TR to ask a question. The next question comes from the line of Saket Kapoor from Kapoor Company. Please go-ahead.
Saket Kapoor
Yeah., my apologies for joining late in the call. So any repeated question. I just heard you mentioned about capex target of INR600 crore for the coming — for these coming two fiscals. That is what you mentioned. INR600 crore capex?
Unidentified Speaker
Yes.
Saket Kapoor
So sir, if we take our last two years capex or the plant purchase of fixed asset that has been also to closer to March ’24 was INR380 crores and for the last fiscal, it was INR212 crores. So if you could just elaborate or throw some more light on-top of these two capex is up closer to INR600 crores, which we have done for the last two fiscals. And the commensurate revenue has not yet been reflected in our turnover profile.
So if you could just allude to us how that — how has this trajectory been looking up? And to an earlier participant, you were also maintaining that 20 — you were saying that ’23, ’27 would be the year when there will be a shift in terms of the profile. So if you could just allude that is the same again, right?
Unidentified Speaker
I think the participants have heard all what I I’ve said. So this year, we are targeting a minimum growth of 15%, it could be higher. And I think the new normal for us is to grow at these two double-digit numbers for the next three fiscals. So all the expansions that we are doing at the moment and what we have done in the past is coming to provision now. So if you see the growth has come in this quarter. So we are running at a run-rate of INR4,800 crores or maybe INR5,000 crores in this quarter that has just ended.
So in this particular quarter that we are speaking in right now and the quarter subsequent to that, we should see further sequential growth, mainly coming from exports and from the domestic aluminum industry. So you should see — see commensurate growth in revenue-based on the capex that was done in the last two years. Okay. We didn’t come immediately on capex completion, but there is a lag of six months — six to nine months. There I agree that there has been no commensurate growth. But now we are on the right track. And so — and our assets will be utilized 100% going-forward. I mean, this year we should hit a very-high capacity utilization and with better profile of margins versus the last year as a whole.
Saket Kapoor
Yeah. So when we look at your closing balance for CWIP, it was closer to INR288 crores. So for this financial year, which of the project and the amount is going to be capitalized? Can you throw light on which of the projects are yet to be commissioned and will be capitalized for the current financial year.
Unidentified Speaker
So if you look at, I guess for last two, three years, there have been two major capex that we have undertaken. One is the increase in the capacity for our Loy Wheel plant wherein we had raised our capacity from 3 odd million to already at 4.2 million and we are increasing it to 5.3 million sometime around H1 end. Again, this is the capex that we have been doing and we have been sharing it with the market as well in terms of the quantum of capex that we have done in last two years. I think the second-biggest capex that we had undertaken in last one year at least is on the knuckle side, wherein we had shared with the market that there is a new product that we have entered into with and it has a potential of almost INR2,000 crores in terms of top-line over next few years. And the transition towards aluminum nuckle could be as steep as the transition that we saw on the steel wheel side.
Unidentified Speaker
Aluminum wheel.
Unidentified Speaker
No, on the aluminum wheel side, sorry. And so even the capex that we are narrating even for this year or next two years, I guess those predominantly cover again the alloy wheel expansion and the knuckle capacity expansion. So if you look at in terms of translation of this capex in terms of revenue, if you look at specifically the alloy wheel side, I get this number in FY ’21 used to be at around INR338 crores, which last year we were at INR1,440 odd crores. So there has been a transition or translation of this capex into numbers. And this will also be visible in this year where we are seeing an incremental growth on the NOIB side, both in domestic as well as exports.
Saket Kapoor
Right, sir. Sir, can you give me the net-debt number and this current year’s maturity and for the CapEx which we have outlined for the two years, how are we going to fund this?
Unidentified Speaker
Yeah. So I guess, see, INR1,047 crore was the net-debt that we had as on March ’24. As on March ’25, this number is at around INR828. And if you look at the capex that we have generated is almost INR600 odd crores over next two years, I guess these can be funded entirely from accruals. So there is no incremental debt we intend to take to fund this.
Saket Kapoor
Okay, sir. And the cost of fund out of this INR828 crore closing balance, how much is the term-loan and the working capital?
Unidentified Speaker
INR370 odd crores will be the term and balance is working capital.
Saket Kapoor
Okay. And our cost of fund,
Unidentified Speaker
Be hovering at around 8.5% to 9 odd percent.
Saket Kapoor
Okay. When we look at our cash-flow snapshot on page number 31, I’m taking it on a standalone basis. We see our — the cash — the operating profit from FY ’22 to remain in the band of say INR450 crores to INR500 crores for the last four fiscals. So taking into account of what you just spoken about the transition towards the new product also and also to the capacity enhancement in the aluminium alloy wheel, what should be the new trajectory in terms of the operating profit that the organization should be eyeing from the current financial year, if you could just give the path which we are going to about to glide now.
Unidentified Speaker
And this if you look at, I guess, the EBITDA that we earned in last four, five years, I guess, was INR465 odd crore in FY ’22 but if you look at in FY ’22, we have also mentioned then there is a one-time income of almost INR60 crores which is sitting there. So net-net operating income, excluding that one-time income, it was already at around INR405-odd crore. That EBITDA has moved from INR405 odd crore to INR500 crores last year. So this is the kind of increase that we have seen in our EBITDA numbers.
I guess MD had already said in terms of the EBITDA per wheel that is the one metric that we share with the market because percentages gives us in this normal picture. That EBITDA per wheel figure has almost doubled if you compare it with FY ’20, we were at somewhere around INR138 crores in terms of EBITDA per wheel this number in last quarter is at around INR270 rupees. So as noted by MD sir as well, I guess INR270 crore probably will be the new base that we will be starting with and then we’ll add-on to it based on the businesses that are there in the pipeline, specifically with focus on alloy, knuckles and exports.
Saket Kapoor
Right. And last point was on the European nation part, sorry, earlier last call, if I remember correctly, you were mentioning about some companies who were offering their facilities to us since they were unable to run the same because of inflationary trends and the demand destruction. So what is the current business environment in terms of specially the European trajectory in the European Union region, which you alluded earlier, sir.
Unidentified Speaker
So I guess situation remain as-is. So the companies out there in Europe are struggling. I guess a few of them has filed for bankruptcy and few of them are looking for stake sales. So situation is as the discussions are there on the table, but what shape the structure will take is still is unknown.
Saket Kapoor
Okay. So we are also in an interested party. We look for building up capacity or into M&A activity in the in this part of the geography.
Unidentified Speaker
It seems that you have some kind of knowledge about this — they have been offered to us and we are evaluating that. But that is nothing that we have firmed up our mind on. We are already winning business because these companies are losing business and they are on the verge of bankruptcy. So the customers are favoring us with business. So we are winning anyways already.
Saket Kapoor
Okay, sir. See, I’ll join the queue and thank you for all the answers. Thank you.
Operator
Our next question comes from the line of Karthik from Suyash Advisors. Please go-ahead.
Karthi Keyan
Understood. Sir, good afternoon. Just wanted to pick your thoughts — get your thoughts on the same topic of Europe. How big can Europe become for you in say three, four years time, sir, given whatever visibility you have today?
Unidentified Speaker
A great question. I don’t have the number, but it can be very big for us and that’s what we are expanding our capacity for. So it’s a great question you’ve asked. It’s definitely one market that we want to are very focused on. We have already — I spoke about this market two years ago and now we are seeing the results and so yes, it’s a great question. I can’t give you the number, but it’s definitely a number that will surpass of — I mean, it will help us our entire capacity that we are expanding with. All I can tell you is that we are going to be definitely very focused on this market.
Karthi Keyan
Yeah. And if I may be labor, would the pricing be superior to say USA or somewhere between India and USA, sir?
Unidentified Speaker
Again, great question. I wouldn’t like to answer this question in this forum because it’s kind of competitive information I don’t want to give away.
Karthi Keyan
Okay. Thanks and best wishes, sir. Thank you.
Operator
Our next question comes from the line of Kedar Kalaje from Nan Partners. Please go-ahead.
Kedar Kailaje
Yeah. Thanks for the opportunity again. So I have two questions. One is on the domestic side, which is like your competitors have also announced capacity expansion, especially in alloy wheels. So do you feel that there could be some oversupply coming in the future in the domestic alloy wheel market? And second would be on the exports market, if you leave aside tariffs for a minute, then what would be our competitive position compared to countries like Thailand, Vietnam or other Asian countries, especially on the export side.
Unidentified Speaker
Nice question. I think the problem with Thailand and Vietnam is about transshipment. What they’re actually doing is they’re not producing wheels there or they’re not producing the whole wheel there. They’re getting parts from China and sort of packing it as made in Vietnam or made in Thailand. So they are under investigation by the US government in a big way under a very big lens. But so they won’t — they won’t really be competitive once you know that USA imposes higher tariffs on these countries vis-a-vis India. So we are very sure about that. Even our customers are saying that.
And I said that in the beginning of my call also that this is what is happening in the customers’ mind. But in terms of cost, Thailand is far ahead of us. I mean, Thailand has no chance to compete with us on a cost basis. Vietnam is a threat, but Vietnam doesn’t have that kind of capacity, it exports to US. A lot of transshipment exports that Vietnam is doing and that should get sorted-out going-forward.
Kedar Kailaje
Okay. Understood. And on the domestic side, on the oversupply regarding the competitors have also announced capex.
Unidentified Speaker
I think there has been oversupply in the last three years. So it’s not a new phenomenon. But is there oversupply of quality product, that is moot. So that’s where we stand-out and that’s why we are winning market-share because of a superior product. And going-forward, I don’t see any more competition coming that has an edge over us. In fact, one of our competitor is going down and it’s a legacy business that was a pioneer in this industry in India. That business is on the verge of closure. We won businesses from them, from the customer, but other than that, I don’t see anyone spending money to compete with us and grab market-share. In fact, our market-share is going to grow this year and the next year vis-a-vis anyone else’s. So we don’t really have fears at the moment from competition.
Kedar Kailaje
Okay. And this competitor that you name that might go out of business, can you share like what what capacity they have or what share of their business will —
Unidentified Speaker
Share capacity, nothing to write home about. But I’m just giving you that example in terms of saying that capacity addition is not only happening, there is capacity deletion also happening. And you have to imagine that the quality product is more paramount than numbers. So you may have a lot of capacity, but that’s unsold. I mean, if you look at my competitors, a lot of barring one or two, most of them are not doing well. Okay. So this business cannot be run by. If you — that this is a growing business, let’s invest. You have to produce quality and prove that you have quality and it takes long — lot many years. So our moving advantage in 2015 is helping us today.
Kedar Kailaje
Okay, understood. Thank you, sir for all answering my question. Thank you.
Operator
The next question comes from the line of Saurabh Jain from Sunidhi. Please go-ahead.
Saurabh Jain
Thanks for the opportunity again. Sir, this is my first-call, so I don’t know if this question would have been answered on previous calls. Sir, if you can talk a bit about the difference in asset turnover in steel versus Loy Wheels and the profitability, like how the profile changes within two segments?
Unidentified Speaker
So see in terms of asset turn, steel, we normally will give you an asset turn of almost 1.25, 1.5% in a certain turn-in NOI will be will be more than 2.5 to 3 odd times.
Saurabh Jain
And profitability?
Unidentified Speaker
Profitability, yes, NOI in terms of margins will be superior versus the margins that you get on steel.
Saurabh Jain
Like how better?
Unidentified Speaker
As an example, let’s say annoy for a particular wheel size in particular wheel — if it is in aluminium, it might be at around let’s say, 13.5%, 14%. A similar wheel in steel will be between 8.5% to 9 odd percent but yeah. But this is going to change. As I said, in 2026, ’27 onwards, you’re going to see a change — see change in this 8%, 9% profile. If not sooner than that. But for sure in ’26, ’27, you will see a quite a big improvement in this.
Saurabh Jain
Okay. And sir, it’s the —
Unidentified Speaker
Majority of our business in terms of volume. So in terms of volume, this segment pass car steel wheels is almost 60% — 54% of our business. And this business is a laggard right now, it has been a laggard for the last 15, 20 years. This is has changed, is about to change in a very material way starting in 26th April.
Saurabh Jain
Okay. And if you can talk about the weight, weight average weight of the wheel in these two segments?
Unidentified Speaker
So average weight of the wheel is very difficult to compare a steel wheel. Sometimes the steel wheel is heavier, sometimes the steel wheel is lighter. But the steel — if you’re talking about why someone would prefer an aluminum wheel, it has better qualities in terms of driving comfort. That’s the main thing. Then it’s aesthetics, how the wheel looks. So I think we’ve spoken about this many times in previous meetings.
Saurabh Jain
Okay, got it, sir. Thank you.
Operator
Hi, thank you. Our next question comes from the line of Ankur, an Individual Investor. Please go-ahead.
Ankur
Good evening, sir. Congratulations on a good set of numbers. Sir, as far as I remember, two, three years back, the remuneration of the MD was linked to the save in percentage. If in case I’m not wrong, is that correct?
Unidentified Speaker
Can you repeat that?
Ankur
5%. The remuneration of the MD was linked to the sales. Is that correct? In terms of percentage?
Unidentified Speaker
No, no. It was never linked to this place
Unidentified Speaker
How can it be link? It’s not logged it’s not legally tenable.
Ankur
Okay I might have read something different that was my question sir and all the best for future thank you.
Operator
Thank you. Ladies and gentlemen, we would take that as a last question for today. Thank you. I now hand the conference over to the management for closing comments.
Unidentified Speaker
Yeah. Okay. Thank you, everyone think we’ve spent the last few years speaking to you every quarter but as I close this call I can tell you that I am the most optimistic about SSWL than I have ever been since I started working in this company. So I will be very happy to exchange more views in the next quarter’s call. Thank you.
Operator
Thank you. On behalf of Anand Rathi Share and Stock Brokers Limited. That concludes this conference. Thank you for joining us. You may now disconnect your lines.