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Shriram Pistons & Rings Ltd

| Quarterly Financial Results Q3 FY 2025-26

BULLISH SENTIMENT

Report Source

⬤2nd Feb 26

Summary : Shriram Pistons & Rings is strategically diversifying, acquiring new businesses, raising capital, and reporting strong financial results despite a one-off regulatory impact.

Quarterly Report Analysis & Insights

Financial Disclosures

  1. Standalone Total expenses (3 months ended Dec 31, 2025): Rs. 7,183 Million.
  2. Consolidated Total expenses (3 months ended Dec 31, 2025): Rs. 8,619 Million.
  3. Standalone Revenue from operations (3 months ended Dec 31, 2025): Rs. 8,651 Million.
  4. Consolidated Revenue from operations (3 months ended Dec 31, 2025): Rs. 10,232 Million.
  5. Standalone Net worth (Dec 31, 2025): Rs. 27,360 Million.
  6. Standalone Debt equity Ratio (Dec 31, 2025): 0.63 times.
  7. Standalone Current ratio (Dec 31, 2025): 1.70 times.
  8. Both standalone and consolidated unaudited financial results are presented.
  9. Consolidated revenue and profit are higher than standalone, reflecting subsidiary contributions.

Corporate Overview

  1. Operates in India.
  2. Financial implications from new Labour Codes (Wages, Industrial Relations, Social Security, Occupational Safety, Health, and Working Conditions Code, 2020) requiring additional provision.
  3. Primarily deals in the automotive component segment.
  4. Undergoing diversification and expansion of business activities.
  5. Formal and informative, focusing on regulatory compliance and strategic decisions.
  6. Acquisition of 100% equity shares of Antolin Lighting India Private Limited (ALIPL), Grupo Antolin India Private Limited (GAIPL), and Grupo Antolin Chakan Private Limited (GACPL).
  7. Purchase of identified plant, machinery, and related piston-line assets for Rs. 280.00 million from Sunbeam Lightweighting Solutions Private Limited.
  8. Issuance of 100,000 secured, rated, listed, redeemable non-convertible debentures (NCDs) aggregating up to Rs. 10,000 Million on a private placement basis.

Risk Factors

  1. New labor codes impact finances.
  2. Acquisition integration challenges.
  3. Regulatory approvals for name change.
  4. Market acceptance of diversification.

Key Drivers

  1. Company name change for diversification.
  2. Strategic acquisitions expand market presence.
  3. New piston-line assets acquired.
  4. Capital raised via NCDs.

Auditor’s Report

  1. Unmodified conclusion: Nothing came to attention indicating material misstatement in the financial results.

Board Commentary

  1. Approved interim dividend of 50% (Rs. 5/- per share) for the Financial Year 2025-26.
  2. Record Date for dividend fixed as Friday, February 6, 2026.
  3. Dividend to be paid/dispatched on or before March 3, 2026.
  4. Additional provision of Rs. 237 million (standalone) / Rs. 252 million (consolidated) due to new Labour Codes, presented as an 'exceptional item'.
  5. Compliance with SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015.
  6. New Labour Codes (Wages, Industrial Relations, Social Security, Occupational Safety, Health, and Working Conditions Code, 2020) impacting financial provisions.
  7. Alteration of Memorandum of Association (MOA) and Articles of Association (AOA) to align with Companies Act, 2013.
  8. Issuance of Non-Convertible Debentures (NCDs) up to Rs. 10,000 Million on a private placement basis.
  9. Acquisition of 100% equity shares of ALIPL, GAIPL, and ~99.99% of GACPL.
  10. Asset purchase for piston-line assets for Rs. 280.00 Million.

Corporate Governance

  1. Audit Committee reviewed and recommended the results to the Board.

Management Discussion & Analysis

Future Strategy

  1. Change of company name to 'SPR Auto Technologies Limited' to reflect diversification.
  2. Alteration of Object Clause and adoption of new Memorandum of Association (MOA) to enhance business activities and explore new opportunities.
  3. Adoption of new Articles of Association (AOA) to align with Companies Act, 2013.
  4. Strategic acquisitions to expand market presence and capabilities.

Operational Focus Areas

  1. Monitoring finalization of central/state rules and other developments pertaining to new Labour Codes.
  2. Ensuring compliance with SEBI Listing Regulations and Companies Act, 2013.

Risk Control Measures

  1. Monitoring regulatory developments for Labour Codes and providing appropriate accounting effect.
  2. Ensuring all corporate actions (name change, MOA/AOA alterations) comply with statutory requirements.

Critical Risks

  1. Uncertainty regarding the finalization and full impact of new Labour Codes.
  2. Integration risks associated with recent acquisitions.