At a Glance
ASK Automotive, India’s brake boss, reported a solid Q1 FY26 with PAT ₹66 Cr (+16.3% YoY) and Revenue ₹891 Cr (+3.4% YoY). Margins revved up as EBITDA grew 19.3%, OPM hitting 13%. The stock trades at a premium P/E 38.7 and an eye-watering P/B 9.5, implying investors expect this brake-maker to keep accelerating, not stalling.
1. Introduction
Two-wheelers don’t just need engines; they need brakes that don’t scream louder than the rider. Enter ASK Automotive – the company that owns 50% of India’s two-wheeler braking systems market. Q1 FY26 numbers suggest their brakes are strong, but the valuation suggests investors think this company rides a superbike, not a scooty. Will it sustain the speed?
2. Business Model (WTF Do They Even Do?)
- Core Products: Brake shoes, advanced braking (AB) systems, and wheel assemblies.
- Clients: OEMs like Hero MotoCorp, Honda, Bajaj.
- Segments: OEM supply and branded independent aftermarket (IAM).
Roast: They literally sell the thing that stops vehicles, but their growth has no brakes.
3. Financials Overview
Q1 FY26 Snapshot
- Revenue: ₹891 Cr (+3.4% YoY)
- EBITDA: ₹120 Cr (+19.3% YoY)
- PAT: ₹66 Cr (+16.3% YoY)
- EPS: ₹3.35
Commentary: Despite low revenue growth, profit rode high on margin expansion and cost controls.
4. Valuation
- P/E: 38.7x – market prices in high growth.
- P/B: 9.5x – expensive relative to peers.
- Fair Value Range: ₹430 – ₹520.
Translation: It’s priced like a Ducati, but don’t expect it to ride on potholes without risk.
5. What’s Cooking – News, Triggers, Drama
- Wheel Assembly segment revenue down 53%, shifting focus to core brakes.
- Margins improving as OPM climbed to 13%.
- FIIs raising stake to 10.24% – they like what they see.
- Capacity expansions to meet OEM demand.
6. Balance Sheet
| (₹ Cr) | Mar 2024 | Mar 2025 |
|---|---|---|
| Total Assets | 1,565 | 1,924 |
| Borrowings | 346 | 412 |
| Net Worth | 816 | 1,043 |
Auditor-Style Remark: Healthy balance sheet, leverage under control, reserves growing like a well-fed plant.
7. Cash Flow – Sab Number Game Hai
| (₹ Cr) | FY23 | FY24 | FY25 |
|---|---|---|---|
| Operating Cash | 139 | 303 | 360 |
| Investing Cash | -161 | -278 | -339 |
| Financing Cash | 23 | -16 | -14 |
Remark: Strong operating cash flow, heavy investments into capacity, minimal financing needs.
8. Ratios – Sexy or Stressy?
| Ratio | FY23 | FY24 | FY25 |
|---|---|---|---|
| ROE | 20% | 24% | 27% |
| ROCE | 20% | 24% | 28% |
| OPM | 9% | 10% | 12% |
| D/E | 0.4x | 0.4x | 0.4x |
Verdict: Ratios so sexy, even Bajaj brakes to look.
9. P&L Breakdown – Show Me the Money
| (₹ Cr) | FY23 | FY24 | FY25 |
|---|---|---|---|
| Revenue | 2,555 | 2,995 | 3,601 |
| EBITDA | 231 | 301 | 432 |
| PAT | 123 | 174 | 248 |
Observation: Revenue growing steady, profits flying faster than sales.
10. Peer Comparison
| Company | P/E | ROE | OPM |
|---|---|---|---|
| Schaeffler India | 59.8 | 19% | 18.5% |
| Uno Minda | 66.0 | 17.5% | 11.1% |
| ASK Automotive | 38.7 | 26.6% | 12.4% |
Comment: Lower P/E than some peers, but still priced for perfection.
11. Miscellaneous – Shareholding
- Promoters: 78.95% (solid control)
- FIIs: 10.24% (growing confidence)
- DIIs: 5%
- Public: 5.8% (minor float – hence volatile)
12. EduInvesting Verdict™
ASK Automotive is a market leader in two-wheeler braking systems, with dominant market share (50%), excellent ROE (26.6%), and expanding margins. The growth is intact, but valuation leaves no room for mistakes.
SWOT
- Strengths: Market dominance, high ROE/ROCE, strong OEM ties.
- Weaknesses: Overdependence on two-wheeler market, expensive stock.
- Opportunities: EV braking systems, aftermarket expansion.
- Threats: OEM price pressure, raw material cost spikes.
Final Word: ASK is not just making brakes; it’s making money hand over fist. But at 9.5x book, investors better hope the ride doesn’t hit a speed breaker.
Written by EduInvesting Team | 29 July 2025
SEO Tags: ASK Automotive, Q1 FY26 Results, Auto Components, Braking Systems
