1. At a Glance
Lumax Industries is the leading auto lighting supplier in India, with Stanley Electric Japan holding a 37.5% stake. If your car has headlamps, fog lights, or tail lamps, chances are Lumax is behind it. They’re riding the auto boom, LED upgrades, and EV lighting shift — while churning steady profits and quietly expanding in Sanand and Pune.
2. Introduction with Hook
While everyone’s debating EVs vs Hybrids, Lumax is selling headlamps to both.
This auto ancillaries veteran has been on a quiet roll — posting a 3-year profit CAGR of 38%, launching plants in Gujarat, and recently delivering a ₹140 Cr net profit in FY25. And if Stanley Electric (Japan) trusts it with their money, maybe you should at least read on 👀.
3. Business Model – WTF Do They Even Do?
Lumax makes lighting products for vehicles. Sounds boring? It’s actually a high-stakes B2B game with 29 plants and Tier-1 status with India’s top OEMs.
- Front Lighting: Headlamps, fog lamps, DRLs
- Rear Lighting: Tail lamps, signal lamps
- Interior & Auxiliary Lamps: Indicators, dome lights
💡 They’re also moving into LED modules, auto electronics, and premium tech-based lighting solutions.
4. Financials Overview – Profit, Margins, ROE, Growth
| Metric | FY21 | FY22 | FY23 | FY24 | FY25 |
|---|---|---|---|---|---|
| Revenue (₹ Cr) | 1,426 | 1,751 | 2,320 | 2,637 | 3,400 |
| Net Profit (₹ Cr) | 18 | 41 | 103 | 111 | 140 |
| ROCE (%) | 8% | 11% | 19% | 17% | 16.4% |
| ROE (%) | 4% | 9% | 19% | 18% | 19.4% |
| OPM (%) | 7% | 8% | 9% | 9% | 8% |
🚨 TTM sales growth = 29%. Margins steady at ~8%, but profits compounding smartly.
5. Valuation – Is It Cheap, Meh, or Crack?
| Metric | Value |
|---|---|
| CMP | ₹3,619 |
| P/E | 24.2x |
| EPS (TTM) | ₹149.67 |
| Book Value | ₹828 |
| P/B | 4.37x |
| Dividend Yield | 0.97% |
💰 Fair Value Estimate:
- Base Case (20x EPS ₹150) = ₹3,000
- Bull Case (28x EPS ₹160) = ₹4,480
- Current CMP = ₹3,619
🎯 EduFair Value Range: ₹3,000 – ₹4,480
Reasonably priced for a high-quality OEM supplier riding industry tailwinds.
6. What’s Cooking – News, Triggers, Drama
- 🏭 New Plant in Sanand (Gujarat) and Chakan Phase-II (Pune) expansion underway
- ☀️ ₹1.49 Cr solar energy investment (cost-saving + ESG)
- 💸 Declared ₹35/share dividend (350%)
- 👋 CEO & CTO resigned in FY25 — management churn alert!
- 💼 Received IT Dept draft notice for AY 2022-23 – low materiality, but noted
⚠️ Governance still fine, but the CXO exits could slow short-term execution.
7. Balance Sheet – How Much Debt, How Many Dreams?
| FY25 Snapshot | Value |
|---|---|
| Equity Capital | ₹9 Cr |
| Reserves | ₹765 Cr |
| Borrowings | ₹888 Cr ⛏️ |
| Total Assets | ₹2,861 Cr |
📉 Debt up from ₹431 Cr in FY23 → ₹888 Cr in FY25 due to capex spree. Keep watch.
8. Cash Flow – Sab Number Game Hai
| FY | CFO | CFI | FCF |
|---|---|---|---|
| FY23 | ₹108 Cr | ₹-90 Cr | ₹18 Cr |
| FY24 | ₹132 Cr | ₹-245 Cr | ₹-113 Cr |
| FY25 | ₹212 Cr | ₹-293 Cr | ₹-81 Cr |
Cash flow from ops is strong, but FCF is 🔴 due to expansion mode. FCF-positive in ~2 years?
9. Ratios – Sexy or Stressy?
| Metric | FY25 |
|---|---|
| ROCE | 16.4% ✅ |
| ROE | 19.4% ✅ |
| OPM | 8% (steady) |
| Inventory Days | 92 |
| Cash Conversion Cycle | -6 (efficient) |
| Working Capital Days | 18 |
💪 Negative CCC = power in supply chain. Despite high inventory, payables and customer advances balance it out.
10. P&L Breakdown – Show Me the Money
- 💸 Sales: ₹3,400 Cr
- 🧾 EBITDA: ₹279 Cr
- 🧠 Other Income: ₹84 Cr
- 💥 Interest + Depreciation: ₹185 Cr
- 📈 Net Profit: ₹140 Cr
- 🎁 Dividend: ₹35/share (~₹31 Cr payout)
Dividend payout is conservative (~23%), which is fine considering capex ahead.
11. Peer Comparison – Who Else in the Game?
| Peer | P/E | ROE | OPM | MCap |
|---|---|---|---|---|
| Bosch | 52x | 15.6% | 13% | ₹1.04 L Cr |
| Uno Minda | 67x | 17.6% | 11% | ₹63.4K Cr |
| Schaeffler | 64x | 19.2% | 18% | ₹65.7K Cr |
| Lumax | 24x | 19.4% | 8% | ₹3.3K Cr |
📉 Lumax has best ROE among them, but is much smaller in size — and cheaper too.
12. Miscellaneous – Shareholding, Promoters
| Category | Mar 2025 |
|---|---|
| Promoters (DK Jain + Stanley Japan) | 75.00% 🧱 |
| FII | 0.97% |
| DII | 5.63% (up 4x in 1 year!) |
| Public | 18.4% |
| Shareholders | 18,660 |
🧭 Japanese skin in the game + rising DII interest = silent accumulation brewing.
13. EduInvesting Verdict™
Lumax Industries is auto-lighting royalty.
- Profits compounding at 38%
- ROE/ROCE in top tier
- Valuation still sane (24x)
- Massive OEM play with expansion in full swing
BUT…
- 🧨 High debt after capex
- 🧳 Key resignations in C-suite
- 📉 No pricing power due to OEM margin squeeze
Verdict™: Lumax isn’t flashy like its LED tail lamps — but it glows with consistency. For long-term investors, this might be the most underrated ₹3,000 Cr compounder in the auto ancillaries space.
✍️ Written by Prashant | 📅 9 July 2025
Tags: Lumax Industries, Auto Ancillary, OEM Supplier, Auto Lighting, Stanley Electric, ROCE, Gujarat Plant, EduInvesting
