1. At a Glance – Blink and You’ll Miss the Margins
₹233 crore market cap. Share price ₹585. Down ~27% in three months and ~45% in one year. ROCE limping at 7.75%, ROE barely alive at 5.32%, and operating margins hovering around 1% like they’re scared of heights. Latest quarter (Q3 FY26) revenue came in at ₹84.19 crore, with a loss of ₹1.24 crore. EPS? -₹3.15.
This is a TVS Group company, mind you. A brand surname that usually commands respect in Dalal Street drawing rooms. But Sundaram Brake Linings currently looks less like “brakes you trust” and more like “numbers that don’t stop bleeding.”
Debt stands at ₹39 crore, interest coverage at a frightening 0.27, and EV/EBITDA has shot up to a comedy-level 38.7x — not because EBITDA is great, but because it’s nearly vanished.
And yet… this isn’t some shady shell. It’s a 45+ year-old manufacturer, asbestos-free pioneer, exporting to 60+ countries, sitting inside the TVS ecosystem. So what exactly went wrong? And is this just a bad patch, or a structural skid? Let’s pop the hood.
2. Introduction – When Legacy Meets Low Margins
Sundaram Brake Linings Ltd (SBLL) was incorporated in 1978, back when “asbestos-free” was not a marketing buzzword but a regulatory nightmare waiting to happen. The company did the right thing early — becoming India’s first 100% asbestos-free friction material manufacturer.
That’s the good part.
Fast forward to FY25–FY26, and the company finds itself stuck in a brutal auto component no-man’s land:
- OEM pricing pressure
- Weak aftermarket growth
- Export volatility
- Rising costs
- And margins so thin that even inflation laughs at them
SBLL operates across automotive, railways, industrial friction materials, and tractors. On paper, diversification looks decent. In reality, the business behaves like a low-margin OEM supplier with limited pricing power.
To make matters spicier, both the CFO and Company Secretary resigned in Feb 2026, right after a loss-making quarter. Coincidence? Maybe. Comforting? Absolutely not.
So let’s break this company down properly — not
emotionally, not respectfully, but financially.
3. Business Model – WTF Do They Even Do?
Think of SBLL as the company that makes sure vehicles stop when you want them to. Brake linings, disc pads, clutch facings — boring, critical, and brutally competitive.
What they manufacture:
- Asbestos-free brake linings
- Disc brake pads
- Clutch facings
- Tractor and industrial friction materials
- Rivets (yes, rivets — because why not?)
Where they sell:
- Tier-I OEM suppliers (~48%)
- Aftermarket (~19%) via 140+ TVS-owned wholesalers
- Exports (~33%) across 60+ countries, with a North America warehouse
Sounds solid, right? Except…
OEM business is a margin killer. Aftermarket is better, but SBLL’s share there is limited. Exports help volumes, but not necessarily profits — especially when logistics, currency swings, and compliance costs join the party.
So the business model is stable, but structurally low-margin. You don’t buy SBLL for explosive growth. You buy it hoping management squeezes efficiency out of every nut and bolt.
Question is: are they?
4. Financials Overview – Quarterly Reality Check
Quarterly Comparison Table (₹ crore)
| Metric | Latest Qtr (Dec-25) | YoY Qtr (Dec-24) | Prev Qtr (Sep-25) | YoY % | QoQ % |
|---|---|---|---|---|---|
| Revenue | 84.19 | 88.30 | 78.03 | -4.65% | 7.9% |
| EBITDA | 0.92 | 2.70 | -2.14 | -65.9% | NA |
| PAT | -1.24 | 0.89 | -3.12 | -239% | Improvement |
| EPS (₹) | -3.15 | 2.26 | -7.93 | NA | NA |
Commentary:
Revenue dipped YoY but improved QoQ. EBITDA exists, but barely. PAT is negative. EPS is crying quietly in a corner.
This is not a one-off bad quarter either —
