SJS Enterprises Ltd. (SJSE.BO): Decorative aesthetics specialist levered to automotive premiumization; initiate at Buy

研报英文原文证据摘录

SJS Enterprises Ltd. (SJSE.BO): Decorative aesthetics specialist levered to automotive premiumization; initiate at Buy

Goldman Sachs SJS Enterprises Ltd. (SJSE.BO)

Financial snapshot

Income statement

Growth: We forecast sales to grow at a +22% CAGR (FY26-FY29E), driven initially by a

pickup in chrome-plated part supplies (+25% annualized revenue growth) following new

capacity expansion, and subsequently by a ramp-up in the automotive display systems

business resulting from the supply partnership with BOE Varitronix. We expect this

growth to be supported by 1) decorative aesthetics picking up faster in

premiumization-led categories, 2) the car digital display market reaching Rs25bn at a

91% attach rate, and 3) growing market share supported by acquisitions and export

optionality. We forecast +22% annualized growth in the legacy decorative aesthetics

business (standalone entity) (c.58% of FY26 revenues), driven by automotive growth

opportunities (both global ICE engine block sourcing from India and a potential volume

uplift in domestic auto demand from India’s 8th Pay Commission in FY28-FY29) and

+16% annualized growth in the Walter Pack business unit focused on IMD / IML and

consumer products offerings.

Margin outlook: We estimate EBITDA margins will expand from 28.3% in FY26 to 29.1%

by FY29E, driven by (1) an improving next-gen product mix; (2) a higher export share

(which carries higher margins); (3) operating leverage in the legacy business from a

potential Pay Commission-led volume pickup in underlying auto demand; (4) additional

volume from recently added capacity in the chrome plating business; and (5) pricing

actions to offset recent inflation in plastic / polymer input costs (due to the West Asia

crisis).

Cash flow statement