Cyclical: 2W lighting, deleveraged
Varroc Engineering Limited is a global automotive component group specializing in exterior, polymer, electrical, and precision metallic components for a wide range of vehicles.
Varroc Engineering Limited provides aftermarket automotive components and solutions in India, the Asia Pacific, Europe, North America, and internationally. It operates through Automotive and Others segments. The company offers internal combustion engine parts; electrical vehicle products, such as telematics, BMS, charger, DC-DC converter, traction motor/hub motor, and traction motor controller; final drive, pump, and park lock gears; hollow stem, titanium, and sodium valves; headlamps; instrument panel, console, roof rails, door trims, and pillar trims; CMS and DMS, ADAS, telematics, surround view system, video telematics, and advanced infotainment system; and tail gate, surface LED, signature LED lighting 3D effect, and LED signal lamp personalization. It also provides engine valves, transmission components, ICE electronics, ACG and integrated starter generator, starter motors, BLDC motors, electronic fuel injection and injection driver, magneto and regular rectifier, actuator motors, starter clutch assembly, and crankpins and balancers. In addition, the company offers e-powertrain solutions, EV chargers, DC-DC converter, and battery management system; painted parts, exterior and interior molded parts, and functional polymer components; digital instrument clusters, smart telematics and monitoring systems, smart sensors, and ergonomic handlebar switches; lighting solutions; and Varroc Connect, a connected vehicle platform. It serves automotive 2W and 3W original equipment manufacturers (OEMs); EV and new mobility players; commercial vehicle manufacturers; passenger vehicles manufacturing; off-highway and heavy equipment OEMs; industrial and engineering companies; and aftermarket partners. Varroc Engineering Limited was incorporated in 1988 and is headquartered in Aurangabad, India.
Key people: Mr. Tarang Jain (Executive Non-Independent Chairman of the Board & MD) · Mr. K. Mahendra Kumar (Group Chief Financial Officer) · Mr. Avinash Ramdas Chintawar (COO & Executive Non-independent Director) · Mr. Anil Ghatiya (Company Secretary & Compliance Officer) · Mr. Arjun Jain (CEO of Varroc Business I & Executive Non-Independent Whole-Time Director) · Mr. Dhruv Jain (CEO of Varroc Business II & Non Executive Non Independent Whole Time Director)
Varroc Engineering major competitors are Lumax Industries, Fiem Industries, JBM Auto, Lumax Auto Tech., Pricol, Banco Products (I), SJS Enterprises. Market Cap of Varroc Engineering is ₹13,554 Crs. While the median market cap of its peers are ₹8,664 Crs.
Varroc Engineering seems to be less financially stable compared to its competitors.Altman Z score of Varroc Engineering is 5.3 and is ranked 6 out of its 8 competitors.
Yahoo profile 23 Sept 2026 · Tijori 23 Sept 2026
Latest reported mix as compiled by Tijori from company disclosures; percentages of revenue.
As the company reports them. They can differ from the ratio table on the Financials tab, which uses Tijori's own definitions (for example NIM on average total assets rather than on interest-earning assets); the Cross-check panel there lines both up.
Varroc Engineering (Aurangabad) is a tier-1 auto-component maker focused on 2W/3W lighting, polymers/plastics, electricals-electronics (including EV traction motors, controllers, chargers, battery-management) and metallic parts, with Bajaj Auto as its anchor customer; after selling its global 4W lighting business (VLS) in 2022 it is India-centric with a Romania electronics plant. EV programmes were 15.8% of Q1FY27 revenue (+87% YoY) and it targets Rs 20,000 cr revenue by FY31 (from ~Rs 8,900 cr in FY26).
44.3x TTM PE is inflated by one-offs in FY26/Q1FY27; Buoyant 26.1x FY28e. Profit CAGR 32% over 3 yrs, ROE 15% (3-yr 20%) vs negative 5-yr history (VLS losses) - re-rating from a distressed past rather than an expensive one. EV/EBITDA n.m.; dividend yield 0.2%.
| Uno Minda | Uno Minda is the higher-quality diversified play (ROE 19%, Q1 PAT +50%) but at 58.6x TTM / 10.5x P/B; Varroc at 44x TTM with one-offs and 26x FY28e offers similar 24-30% growth at a discount. |
| Lumax Industries / Lumax Auto Tech | Lumax Industries (28.7x, ROE 22%) is a pure 4W lighting JV play with Rs 973 cr debt and a smaller Rs 5,772 cr mcap; Lumax Auto Tech trades 39.8x / 10.9x P/B. Varroc gives EV-electronics exposure and Bajaj export leverage instead of 4W-lighting concentration. |
| Minda Corporation | Minda Corp is at 41.7x TTM with 14.7% ROE and ROCE 12.7% vs Varroc ROCE 19%; Varroc is growing faster (Q1 revenue +30% vs +33% for Minda but with stronger EV mix) at a lower FY28e multiple. |
Share of revenue as disclosed in filings (Tijori normalisation). Segment profit measure: not disclosed in this source — segment EBIT/EBITDA/PBT are not shown rather than estimated. Eliminations and unallocated costs not available here.
Share of revenue as disclosed in filings (Tijori normalisation). Segment profit measure: not disclosed in this source — segment EBIT/EBITDA/PBT are not shown rather than estimated. Eliminations and unallocated costs not available here.
Share of revenue as disclosed in filings (Tijori normalisation). Segment profit measure: not disclosed in this source — segment EBIT/EBITDA/PBT are not shown rather than estimated. Eliminations and unallocated costs not available here.
Share of revenue as disclosed in filings (Tijori normalisation). Segment profit measure: not disclosed in this source — segment EBIT/EBITDA/PBT are not shown rather than estimated. Eliminations and unallocated costs not available here.
Share of revenue as disclosed in filings (Tijori normalisation). Segment profit measure: not disclosed in this source — segment EBIT/EBITDA/PBT are not shown rather than estimated. Eliminations and unallocated costs not available here.
Automobile — 4.4%: a Value leader and two cyclical component makers
FY26 was a record year for Indian autos: 2.83 crore wholesale units (+10.4%), two-wheelers +10.7% with scooters +18.5%, passenger vehicles +7.9%, commercial vehicles +12.6% and exports +24% to 66.5 lakh units — SIAM credits the September 2025 GST cuts and 125 bp of repo cuts. Retail momentum continued into August 2026 (FADA +18%, PVs above 4 lakh in an August for the first time), although the base was soft. Two structural shifts matter to how we are positioned. First, exports: Bajaj Auto ships around half its two- and three-wheelers abroad and Indian component makers are winning global platforms as the world de-risks from China. Second, the powertrain mix is changing faster than anyone expected — in August 2026 alternative fuels (CNG 25%, hybrid 9%, EV 7.6%) overtook petrol in passenger-vehicle retail for the first time and EV registrations hit 3.5 million in FY26 — which rewards the players with the broadest technology portfolio, not the incumbents. We hold the sector through one Value large cap (Bajaj Auto, 34x FY27E, 30% ROE, ~50% of units exported, a net cash balance sheet and the Chetak EV scooter now number two in the market) and two small-cap Cyclicals bought at earnings troughs (RK Forgings after a one-off inventory write-off; Varroc after its debt and Europe restructuring).
Maruti is the PV leader but at 30x prices a recovery that CNG/hybrid mix has already delivered, and it is the most exposed to small-car weakness; Tata Motors is a JLR story; M&M is the best-run OEM but at 30x+ after a 3x move we prefer Bajaj's export optionality and net cash. Hero MotoCorp is losing share to scooters and EVs; TVS and Eicher are great franchises at 40–45x. Among components, Bharat Forge carries a defence multiple and Motherson a European-auto cycle we do not want.
| Lights for Electric Vehicles - Market Share | 20 % | as of Sep 20 |