Talbros Automotive Components Ltd (NSE: TALBROAUTO) Q3 2025 Earnings Call dated Feb. 12, 2025
Corporate Participants:
Anuj Talwar — Joint Managing Director
Manish Khanna — Chief Financial Officer
Navin Juneja — Director
Analysts:
Yash Kukreja — Analyst
Unidentified Participant
Kuber Chauhan — Analyst
Shikha Mehta — Analyst
Uttam Purohit — Analyst
Presentation:
Operator
Thank you ladies and gentlemen, good day and welcome to Talbros Automotive Components Limited Q3 FY ’25 Earnings Conference Call. This conference call may contain forward-looking statements about the company, which are based on belief, opinion and expectation of the company as on the date of this call. These statements are not the guarantees of future performance and involve risks and uncertainties that are difficult to predict. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Anuj Talwar, Joint Managing Director of Automotive Components Limited. Thank you, and over to you, sir.
Anuj Talwar — Joint Managing Director
Good afternoon, everybody. A very warm welcome to our Q3 and nine months earnings call. On the call, I’m joined today by with me Mr. Navin Juneja, our Director on the Board, Group CFO; Manish Khanna, our CFO for Automotive; and SGA, our IR Advisors. The results and the presentation are uploaded on the stock exchange and the company website. I hope everyone has had a chance to look at it. Let me begin with the industry and the economy overview. In Q3 FY ’25, the Indian automotive industry displayed a mixed performance with an overall volume growth of 3.1% year-on-year. Passenger vehicles show healthy recovery, increasing by 4.5% Y-o-Y. The two-wheeler segment grew at about 3% Y-o-Y and three-wheelers only registered a growth of 0.9% Y-o-Y, primarily due to a slowing of demand in urban areas and challenging vehicle and challenges in-vehicle financing. Commercial vehicle sales remained subdued, rising by just 1.2%, reflecting the ongoing weakness in industrial activity and maybe delayed capex from the government and the private sector. Account of retail sales data, the tractor industry experienced a remarkable growth of 20.1% Y-o-Y, driven by good agricultural performance and also healthy monsoons in our country. EV sales electric sales grew at about 27% Y-o-Y. Coming to the company performance. During quarter three FY ’25, revenue of automotive remained stable, primarily supported by strong domestic sale despite a large decline in exports to the European market, where a slowdown in the automotive sector is happening. Despite lower exports, the company delivered a 7% increase in EBITDA margins and achieved an EBITDA margin of 17.4%. So this achievement is based on good cost management, operational efficiencies and a lot of localization of a few components. During the first-nine months of ’25, the revenue grew by 9% INR634 crores, demonstrating the company’s ability to maintain momentum in-market — evolving market dynamics. EBITDA margins for nine months improved by 130 basis-points, reaching 17.0%, underscoring sustained efforts to drive profitability and operational efficiency. Our PAT saw a growth of 13%, rising to INR68 crores for nine months. This, I feel is a commendable job done by our team in difficult circumstances where the auto industry has generally been very muted. So we worked internally on our costs and our efficiencies. In FY ’24, the company secured orders — new orders worth INR980 crores. An additional INR1,478 crores in new contracts was secured during the first-nine months of FY ’25. Execution has already started for these select projects. This will take time to come into birthing when I say burning come into reality. At the same time, these projects will trickle in by quarter two, quarter three of this year. The new contracts include significant deals with leading OEMs across domestic and national markets, highlighting a strong confidence that the OEMs have us and our joint-ventures. A noteworthy portion of the order book comes from electric vehicles, which is, as said earlier to you, we are making some inroads into the — getting our position strong in electric vehicle supplies as well. So the gasket division, which accounted for about 52% of the company’s revenue, during the quarter, this segment grew by 5% in this quarter. As you know, it is heavily muted towards the commercial vehicle space, which was very sluggish in the whole year. To drive diversification and growth, we have been increasing our focus on our heat shield division, which has given us good results over the past nine months. We have also received new orders from the heat segment of about INR245 crores for only heat shoes. Revenue from this segment reached INR32.25 crores with high margins for this particular product-line. We are now working on different kinds of heat shields that he should be working on for noise installation. Some we are also now working on for safety-critical items like battery heat. So these are all work-in progress. Our forging division, which has given some stellar performance over the last several quarters faced its first headwind of the European car market. So there was a slowdown in Europe, which we saw, maybe schedules were very, very muted, stocks were high, but this I think will correct in the next quarter or two. So despite the headwinds that it faced, an improvement EBITDA margins compared to previous year because of cost-saving measures and also some price increases we received from our customers. Our joint-ventures have delivered a good growth as they both are linked to the passenger vehicle segment, increase its share of business in the current customers and also acquired new customers both in India and domestically. Our joint-ventures, I feel are at a stage today where growth is going to happen at a faster pace than ever before. So we as a company have shown that exports, even though in a muted market touched 26%, which is a good sign in the healthy side of exports. We continue to increase our play both in the domestic market as well as exports. Thanks. With this, I will hand — with this, I will hand over the call to Manish Khana, our Talgo’s Group CFO, to take you forward with our financial performance. Manish, go-ahead, sir.
Manish Khanna — Chief Financial Officer
So thank you, Mr. Anuj. Good afternoon, and a warm welcome to all the participants. Let me begin with the financial review. Total revenue for Q3 FY ’25 stood at INR204.4 cr against 201.5 cr in Q3 FY ’24, a relatively flattish growth of 1% year-on-year and for nine months FY ’25, it stood at INR633.8cr against INR583.4 cr in nine months FY ’24, which is also a growth of 9% year-on-year. EBITDA for Q3 ’25 — FY ’25 stood at INR35.6 cr against 33.2 cr, a growth of 7% year-on-year. For nine months FY ’25, it stood at 107.5 cr as compared to 91.8 cr in the same-period last year, indicating a growth of 17% year-on-year. EBITDA margins for Q3 FY ’25 stood at 17.4% as compared to 16.5% in the same-period last year, higher by 90 basis-points. And for Nine-Month FY ’25, it stood at 17%, which has increased from 15.7% last year, higher by 130 basis-points. PAT for Q3 FY ’25 stood at 23.8cr against 22.7cr in Q3 FY ’24, a growth of 5% year-on-year for five months FY ’25, it stood at 67.8cr as compared to INR60.2 cr last year, a growth of 13%. In gasket division, specifically in Q3 FY ’25, sales for gasket division stood at 136.8 cr as against 130.3 cr in Q3 FY ’24, 5% growth year-on-year for Nine-Month FY ’25. Our gasket sales was 413.7cr as against the 381.9 cr in Nine-Month FY ’24, a growth of 8%. EBITDA for Q3 FY ’25 was 22.8 cr, which is a growth of 9% as compared to the same-period last year and for nine months FY ’25, this segment saw EBITDA of 69.6cr as against its 57.9 growth of 20% year-on-year. Coming to forging division, revenue in Q3 FY ’25 was INR67.6cr as against 71.2 crore in Q3 FY ’24, primarily because of export demand being little subdued in European markets. In nine months FY ’25, the revenue grew by 9% to 221.2 cr as against 202.7 cr in nine months FY ’24. EBITDA stood at 12.8cr in Q3 FY ’25 as against 12.2 in Q3 FY ’24 and EBITDA saw a growth of 11% in Nine-Month FY ’25 from 35 cr to 39 cr in the same-period for the last year. For Travel Systems Private Limited, revenues for Q3 FY ’25 stood at 72.3cr against 68.7cr, a growth of 5% year and for nine months FY ’25 stood at 208.6cr versus 189.6 crs in nine months FY ’24, registering a growth of 10% year-on-year. EBITDA for Q3 FY ’25 was 11.9 crs against a growth — which is a growth of 25% year-on-year and Nine-Month FY ’25 stood at 32.1cr as against 25.2 cr in nine months FY ’24, growth of 27% year-on-year. For Talboro Margo Robert Private Limited, revenues for our TMR business in Q3 FY ’25 were INR31.5 crore, which is which showed a growth of 11% year-on-year basis and stood at — and it stood at INR95.9 crores in nine months FY ’25 versus INR91.191.6 crores in Nine-Month FY ’24, registering a growth of 5% year-on-year. EBITDA stood at 3.8cr in Q3 FY ’25 as against 2.2 cr in Q3 FY ’24. And Nine-Month FY ’25, it was 12.1 cr as compared to 6.7cr in nine months and FY ’24, a growth of 81%. The company remains dedicated to delivering exceptional value to the customers by providing high-quality products and maintaining competitive pricing. Our strong focus is placed on upholding excellence across all segments, while fostering strong collaborative relationship with the stakeholders. That is all from our side, and I would like now to open the floor to questions-and-answers.
Questions and Answers:
Operator
Thank you thank you very much. [Operator Instructions] First question is from the line of Yash Kukreja from Equitree Capital. Please go ahead.
Yash Kukreja
Yeah. Thank you so much for the opportunity. And sir, congratulations for posting decent set of numbers even when industry demand remains subdued. My first question is considering the sluggish export demand and the divestment in NLT, do we speak to our guidance of INR2,200 crore by FY ’27?
Anuj Talwar
Yeah. So yeah, yes, we still speak to our guidance for INR2,200 crores. I think it should be possible because we are getting some more business from Indian OEMs such as Mahindra, large SAV manufacturer in the country. We’re getting some good traction from Tata Motors. Even if you see in this nine months, we’ve shown that has gone up to about, I think 17% to 18% as a contribution for our customer-base. So we are pretty hedged. So yes, we maintain our guidance because exports is about 26% and in exports, if Europe — Europe has slowed down a bit, we’re still looking at orders in the US and in the UK, which will compensate this. This is like a correction I feel to be honest with you because it got hit — Europe got hit by sluggish demand, but also our stock levels have gone up to a large extent as well to the European nation. And so they were pulling less from us. So — but I’m already seeing better signs for quarter four.
Yash Kukreja
Got it, sir. And sir, our EBITDA margins will remain around this level only?
Anuj Talwar
Yeah, yeah, please.
Navin Juneja
EBITDA margin, you should look at it for nine months, not quarter-by-quarter because some price increases of earlier quarter comes in this quarter, etc., etc. We should be able to maintain EBITDA between 16.5% to 17% going forward?
Yash Kukreja
Got it, sir. Okay. And my last question is, what has been the utilization levels and what is the maximum revenue potential from all the existing facilities, including the new Pune facility?
Navin Juneja
Yeah. But if we see from the gas, we should be — we should have a — I think it should be around INR530 crores to INR540 crores we can do from the existing facilities, okay, at but the capability and we are about 85% of that in forging, we can do around INR350 crores and we are around — in forging, we are around 70%, 75% in machining, we are 90%. In, of course, we are block, we are setting up a new plant for the slantis order, which is I think will be commissioned within next six months. So with that, the capacity should be around INR500 crores. Margo, we have a capacity with the little addition of written machines, we can easily produce around 100 — around INR180 crores. At present we had about INR130 crores IN 135 crores.
Yash Kukreja
Okay. Yeah. Thank you so much, sir. That’s it from my side.
Operator
Thank you. [Operator Instructions] Next question is from the line of Abdul Daga from Daga Securities. Please go ahead.
Unidentified Participant
Hello. Hi, sir. Just two questions from my side. So you can’t audible. I request you to please use your handset. Hello. Yes, please go-ahead. Okay. So I had two questions. The heat shield segment continues to scale reaching up to INR32-odd crores in nine months FY ’25 and the new orders of INR245 crores have been secured. So what is the expected revenue contribution from this segment in FY ’26?
Navin Juneja
I think he should — with the new borders up to coming in and ya going-forward and Volvo coming in and we expect that this business should give a revenue around INR65 crores to INR70 crores in next financial year, ’25, ’26.
Unidentified Participant
Okay. Got it, sir. Sir. Also, the basket business continues to be a major contributor of our revenue.
Navin Juneja
Yes. 48% revenue is coming from there. Yeah.
Unidentified Participant
So what are the key drivers for future growth and how do you see the market-share evolving?
Navin Juneja
Yeah, every business, every decent growth trajectory. In gasket business, I can see about 12% to 15% growth. In, it’s about 25%. In forging, it should be 25% and coming to next near one or two years I’m talking about. And should be 35%, 30% 35%, Margo should be around 25%. So overall, we are looking at a growth of 20% plus in next couple of years. And the key drivers are the new businesses, new orders converting into commercial production, number-one. And the little 5% to 7% normal growth will be there, which last year was totally CV was totally down. You know that now for nine months, there is already growth and passenger vehicle was also grown by 2%, 3%. In particular, certain companies like Mahindra performed very well. Rest are all — is 2%, 3%, rest are all flattish type or negative. And two-wheeler have done well, 13% 14% in which Honda had done the best, rest are — okay, okay, Bajaj, we are there in Bajaj and here, we are not there in Honda. So we foresee that the demand will come with our have been announced some going-forward, the interest-rate, I think we are indicating a reduction of 0.7%, 5% this calendar year. Everything going-forward, which we foresee that the demand should grow.
Unidentified Participant
Okay, got it, sir. Okay. That’s it from me. Thank you.
Operator
Thank you. [Operator Instructions] Next question is from the line of Kuber Chauhan from Anand Rathi. Please proceed.
Kuber Chauhan
Yeah. Two questions from my side. Can you give me the breakup of your vehicle type like for this particular quarter?
Anuj Talwar
What you want to breakup of.
Kuber Chauhan
When you come — from two-wheelers, passenger vehicles and for this — for this particular quarter.
Manish Khanna
Just a, just a little 18% is two-wheelers, 34% is cars, 22 trucks and 13% is agric.
Kuber Chauhan
Okay. And okay. And secondly, you said that EBITDA margins increased because of some localization of components. So can you…
Manish Khanna
We import some components, we import some components from — for a gaske division. We try to localize them in India, but it’s a contribution of localization, it’s a contributor price increase plus operational efficiencies and economies of scale.
Kuber Chauhan
So have you seen a reduction in — okay. Have you seen any reduction in imports? I mean, if you can just give me some percentage, how much we have localized or how much have been the reduction of imports?
Navin Juneja
So is it quarter exercise, it’s a quarter of exercise. We can’t give a number. We have set a target of INR8 crores, INR10 crores and we follow that because we have to take for the localization, we had to take the OEM approval also. We had to give them a sample for — because any change in raw-material, we need to inform them because OE will — because they are ready to pay for the higher price, but you know-how the currencies are moving, like how the dollar has gone crazy. So we are — we are we do some local manufacturing. We got it approved, a long, take one, one and a 1.5 years for the approval and we had to pass-on some benefit, but some benefit will keep also.
Anuj Talwar
And lastly, what we can tell you is, overall our import buys in the next last years have actually come down 8%.
Navin Juneja
As a percentage. Yeah, if we — yeah, as a percentage of total consumption, it has gradually come down and we are trying to offer in the new RFQ, we are offering a local — local RM, not avoiding to offer a boarded RM.
Kuber Chauhan
Okay, got it. Got it. And just wanted to know regarding the demand scenario about domestic as well as the international market, how has been and what has been your guidance for upcoming quarters or next six months?
Navin Juneja
Yeah, yeah. I can give you a guidance of more 24 months approximately. And export market is there. We are in agri offloader in a big way, which is not going to go anywhere. Of course, we are in passenger cars also. There is a little muted growth, but they are showing a normal trend because of the overstocking at their end, because of China Sea, et-cetera, we — because the lead-time increased from eight weeks to 12 weeks, we sold more material to them. So they got more inventory and little 10% tampering of demand from their side. With the result, some effect has come in this quarter and this will be all over from — by March. Everything will be normal by we have developed new product for the off-roader business. The supply just started and next year, next two years, it should boom. We are getting new orders from the US, etc. In the forging component, there is no problem of the — and in the gasket, there is no problem of demand from that side. Okay. And we are not that big that we controlled 50%, 60% of the export market, sorry. We are just 1% or 2%, 3%, doesn’t make a difference to us.
Kuber Chauhan
Okay. Got it. Clear. Thank you and all the best.
Operator
Thank you. [Operator Instructions] Next question is from the line of Shikha Mehta from Time & Tide Advisors. Please go ahead.
Shikha Mehta
Hello, sir. Good afternoon. Congratulations on a decent set of numbers in a tough scenario. I just have a few questions. I’m trying to understand the quarterly numbers a bit better. Like we’ve mentioned this quarter export was not as great for us. So is this kind of the bottom or are we seeing improvements in Q4 because they’re already midway in March, as said. So would Q3 be the bottom for exports? That’s number-one. And second, we spoke about lead-time kind of increasing on the inventory cycle. Again, some effect of that has been seen in this quarter. How much of that is expected to spill-over in Q4?
Navin Juneja
So regarding the first statement in export is down, export, direct export is down, by the way, direct export is — we have done a decent rate export in this quarter. My inforging division upwards in gasket division, my export against 15% was down by to 13%, a downfall of INR2 crores to INR3 crore only in forging division, my export is 62% is 62%. The demand has come down in the case of indirect export, not direct export, sorry. Okay. That exports has gone to 62% and it will remain between 60% approximately in the current quarter also. That demand came down in the indirect export because of the excess inventory lying with the customer outside, number-one, because of the Red Sea problem, if we ship more material, that’s the problem resolved and the inventory is stuck there, not a little bit demand has come down a little bit and but it has been normalized by the margin. We have been we have received the revise to do for the next financial year. There is no problem. Demand that — and other export will — this export number two, that some projects have been delayed of European car manufacturer, which will be commercialized by June, July, plus our under order of, which was delayed because of the passing of sample. Sample has now been cleared. We are yet to go. The commercial production of that order will we expect to start by the end-of-the second-quarter. So that is — again export, big export, huge export. So export by last next year, third-quarter, fourth quarter, you can see a huge jump-in export. So would it be export is the export is there?
Shikha Mehta
So would it be right to assume that H1 of FY ’26 will be significantly better than H2 of FY ’25? Just talking about exports?
Navin Juneja
No, our export will be better, definitely. First of all, Q4 will be better than — we should be 10% better than Q3 in all aspects minimally.
Shikha Mehta
Got it. And another thing, sir, trying to understand the CV space a bit better, I understand we’ve been seeing sluggishness for a while now. Are we seeing any green shoots kind of looking at it?
Navin Juneja
Yeah. But first of all, I want to tell you that we have the orders in-hand, the commercial production launches had been delayed by OE in the case of Maruti, yeah, in the case of Maruti, we have the order for Maruti sheet suspension EV vehicle, okay, it was supposed to launch in February. It had been delayed till June because I think they are not able to — there are other issues with other products. They are not able to resolve that. Similarly, in the case of European car manufacturer also, order in-hand is there. Everything product had been developed, sample had been tested, everything is ready, but they have — they are saying they will be launching down in July. So order — order book is there and launch has been delayed by the various reasons they have been delayed by the OE customers. It’s not going to go anywhere. It is going to come maybe three months here and there are four months here and there. That’s all.
Manish Khanna
Yeah. But your question was also on commercial vehicles. Yes, we are seeing an uptick in-demand.
Navin Juneja
Yeah, definitely, definitely. Commercial, it is there.
Shikha Mehta
Okay. So we are beginning to see green shoots?
Anuj Talwar
Yeah, yeah. We are seeing a pull-in our stock — in our schedules. Clearly, yes.
Shikha Mehta
I think maybe in FY ’26?
Anuj Talwar
Yeah. I think it will be better. I think all that confusion of elections and getting government formed in the summer of last year and this and that, I think that’s now of the past and I think we are seeing an uprise here in vehicles.
Shikha Mehta
Okay. All right. Great. And lastly on our JV side, again, we are, I think set for really significant growth. Our capacity will be coming up in the next six months as we mentioned earlier.
Navin Juneja
Yeah.
Shikha Mehta
If you could just throw some light on that, what kind of peak revenues this new capacity can look for us and what kind of margins would be expecting?
Navin Juneja
Yeah. But regarding the, the shed is ready. We have already set-up some few requirement for the European customer was also there, UK customer was there. We set-up the few presses for that and we have in-house we used to do outsourcing of ED painting, etc., which we have started doing in-house. We have set-up the facility of that also. Now with the passing of sample by — within the last two days, now we are starting the process of importing the balance equipment. The total capex will be around INR45 crore to INR50 crores at present and it should be ready by the year-end, all the capex is, but we can start the production in the cycle. By August-September of this year, we should start the production and filling our stock, et-cetera and we can see within next two years, meaning this year, 25, 26, ’26, ’27, we should be around INR500 crores in this company and EBITDA margin should be around 15%, approximately minimum. We are already at 14-plus plus, we are already there here.
Shikha Mehta
We’re right. Okay, great. This was very helpful. I’ll come back-in the queue. Thank you.
Operator
Thank you. Next question is from the line of Uttam Purohit from Monarch Networth Capital. Please go ahead.
Uttam Purohit
Thank you for the opportunity. So my question was on the side. So we are targeting somewhere around INR500 crores of revenue by FY ’27. And seeing the current luggish here so that would mean we are targeting more than 25% Y-o-Y growth in the next coming two years. Yeah, somewhere around 27%.
Navin Juneja
Yes. So we so we are targeted? Yeah. Yeah, please go-ahead first.
Uttam Purohit
Yeah, yeah. So I was just confirming, do we see any of change in our guidance or any revision or reduction in that?
Navin Juneja
Maybe you are right. You are right in saying we also disclose the same thing. Next year, we should be looking for 25% growth in next two years. Maybe we will see at the end of year because sometimes the demand comes up-and-down, sometime development time takes extra time also and we need to add capacity sometime it will get delayed. Maybe we can go up by 5% or more than that, not more than that.
Anuj Talwar
There are some more customers in the pipeline from UK and we will be everything. It’s a work-in progress because we have to keep getting.
Navin Juneja
Our focus is yeah. We have to attire 500. We can achieve 495, we can achieve 480, but it can’t be 400, please.
Uttam Purohit
Okay. Yeah, that’s my side. Thank you.
Operator
Thank you. [Operator Instructions] Next question is from the line of Pratap from Pratap Securities. Please proceed.
Unidentified Participant
Thanks for the opportunity, sir. My first question would be given international uncertainty. Can you throw some light on whether we can expect any change in domestic to export mix going-forward from an overall global outlook for the coming one to three years? Thank you.
Navin Juneja
No, we don’t see any major change. No. We see still there is a huge demand out of forging component on the machining component, a huge, huge demand because we are — like I told you earlier in the call, we are not very big — we are a small company in a big ocean. So by demand coming here by 5%, 10% doesn’t make a difference much to us.
Unidentified Participant
Understood. Got it. My second question would be about EMR businesses. So going-forward, just wanted to understand the growth prospect of what kind of growth are we looking in that segment?
Navin Juneja
Is this thing like, in which segment you guys said?
Anuj Talwar
Talbros Marugo is very, okay.
Navin Juneja
Yeah, next year, we are looking at a growth of 25%. We are taking now new players also in the Indian OEMs only, two or three big OEMs. I think for next two years, it should be around 25% minimum.
Unidentified Participant
Okay, understood. Thank you so much.
Operator
Thank you. [Operator Instructions] The next question is from the line of Riya Sharma from CK Capital. Please go ahead.
Unidentified Participant
Hello, sir. Thank you. My first question is from — is the MKS saw strong EBITDA growth of 25% Y-o-Y in Q3. So are there any new customer additions or some product developments expected in this segment?
Anuj Talwar
For which company?
Navin Juneja
Yes. For our company as a whole, she is talking about and you are right. You are right. The more the export is there, the more profit will be there, number-one. In the forging division, we have a Phase-3 of the European car — we’ve been this off-roader business OEM. The new phase was added, the supply has increased. So I’ve told you earlier, 60% is export in forging in last quarter. It has contributed towards high and getting higher EBITDA. Second is the price increase, etc freight increases were there in the past which pending we got in this quarter that the combination of these two stuff has increased my EBITDA plus cost-cutting, etc., which has already told you, it’s a result in favorable response and will be the result, we have accumulated a decent EBITDA in this quarter.
Unidentified Participant
Okay, sir. Got it. And my second question is, what is the expected capex allocation for FY ’26 and which segment would be in major focus?
Navin Juneja
So major focus, we — I believe every — everybody is equal to us, is equal to us. The more — the more order the — because the margins are good in every business now. It’s not even one business is 2% EBIT margin and one other is 20%. No, it’s 1% or 2% here and there, everybody is equal now. So the more the order is there for bid division and where the capacity is lacking, we will invest money in that division, irrespective order.
Unidentified Participant
Okay, sir. Got it.
Operator
Thank you. [Operator Instructions] Next question is from the line of Uttam Purohit from Monarch Networth Capital. Please go ahead.
Uttam Purohit
Thanks for the follow-up. So if you could help me with the utilization for nine months, so we have utilization for FY ’24. So if you could share the utilization level for gas forging MTC for nine months as well.
Navin Juneja
What you want to know, nine months.
Uttam Purohit
Utilization level.
Navin Juneja
Utilization level, utilization level, just a moment please. Utilization level from nine months. It’s around 78% gasket, around 80% in, okay, in forging, it’s around 70% in forging, 90% plus in machining. And in the case of, it’s about 78% to 80%. In the case of Margo, LT vibration is around 80%, roads is around 82%. Okay.
Uttam Purohit
Okay. And on the MTCS side, so this INR80 crore capex — capex we would be doing by FY ’27. So how much additional capacity it will provide from the current level? So even if it has a certain it would be helpful.
Navin Juneja
Yeah, it depends on the next year budget numbers. I will be able to give a better answer to this question in the month of our annual results in the month of May. By the time we’ll get the schedule of all the OE customers, fresh order, et-cetera, which has closed or which are closing, when the commercialization will start, we can give a better picture.
Uttam Purohit
And earlier guidance which we provided for — sorry, was somewhere around INR700 odd crores by FY ’27.
Navin Juneja
Yeah.
Uttam Purohit
So I think that’s a very huge number if we consider the muted base for current year and current — that would likely understand and…
Navin Juneja
I understand from where you’re coming. In the current year, we anticipated that the — our European car manufacturer will start the production and we are already of huge order of 50-60 lying with us to be commercialized. That has been delayed. On the only first phase has been started. There are three phases. By September, we anticipate all the phases will start. And the other order of European car manufactured for which we got the order, I think in the — we announced in the month of last — this April, last April that there is some — there was some design change, etc., the design finalized and two months, it was on the test-bed. Now two days back, test has been, 100% will passed and now the activity has started, it has delayed by six to seven months as a as such, but we try to start this business in the month of August, September. So this year, the full impact will not be there, but it has been little bit delayed by six to nine months overall figure. So, but the figure is there, don’t worry, it is there.
Uttam Purohit
So we might — so the guidance might be — or we might miss the guidance by one or two quarters, right? That’s the assumption.
Navin Juneja
That’s nothing more because something is not in our hands, some design changes happen or some doesn’t launch the vehicle to dependent. And if you could provide — I know this is very granular data. If you could provide how much revenue contribution comes from Europe particularly and how much impact we have seen in de-growth terms? You would really impact in this financial year to the extent of 15 cr on as a whole, as a whole company. But some is some is because we have supplied excess previously, partly 50% is because we supply excess. Because of the we because we are a single-source of the part and Red Sea was there, the sea was getting the ship is getting delayed, we supply excess quantity 50% is because of the schedule coming down that so but everything is normalized by March. Okay. There is no major other impact. There is no other impact.
Uttam Purohit
Okay. So the 15% is for quarter or the nine months.
Anuj Talwar
Annual I’m talking about. Okay. Annualized. Okay. Thanks. But the best impact has come in the last — it will come in the last six months only. First two quarters there was no impact.
Uttam Purohit
Yeah, that’s understandable considering the rent effect. Yeah. Yeah, that’s from my side. Thank you.
Operator
Thank you. [Operator Instructions] Next question is from the line of Yuk Modi from AP Capital. Please go ahead.
Unidentified Participant
Hello. Yes, sir. Thank you for this answer. I just had one question. Sir, EV orders have been secured from top OEMs. Could you share insights into ramp-up plan and long-term revenue expectations from EV components?
Navin Juneja
Sir, we have already in the guidance we said is we are targeting 12% our total revenue to come from EV. But I don’t think — because of the delay in launches by OE customers, the project has gone delayed. If we — if they — if we see our order and the numbers shown by them, it will cross easily 12%.
Anuj Talwar
Yeah. But there are delays right now. So you can take a number about 10%, I would say a good number, but I mean, they can be there is a delay.
Navin Juneja
Yeah, delay.
Anuj Talwar
But we are not losing any market-share any. We are progressing to get the…
Navin Juneja
The order is with us. It’s a part developed, given for testing, everything is okay. We are waiting for the launch.
Anuj Talwar
Yeah.
Unidentified Participant
Okay. Thank you, sir. That’s all.
Operator
Thank you. Ladies and gentlemen, that was the last question for the day. I would now like to hand the conference over to the management for the closing comments.
Anuj Talwar
Thank you. Yeah. Thank you all for joining the call. I hope we were able to answer all your questions. For any further queries, you can get-in touch with from SGA, our IR Company. Thank you so much and all the best. Bye-bye.
Navin Juneja
Thank you.
Operator
[Operator Instructions]