LG Balakrishnan & Bros Ltd., a leading manufacturer in India’s auto component sector, has reported a steady financial performance for the quarter ended June 2025. The company posted consolidated revenue from operations of Rs 6.57 billion and a net profit of Rs 669.7 million, reflecting its operational resilience and strategic focus amid a challenging macroeconomic environment. The results underscore the company’s ability to maintain profitability through disciplined cost management and sustained demand across domestic and export markets.
Key Highlights:
- Consolidated revenue from operations: Rs 6.57 billion
- Consolidated net profit: Rs 669.7 million
- Employee cost: 16.55 percent of operating revenue
- Interest expense: Less than 1 percent of operating revenue
- Dividend declared: Rs 20 per share (record date August 14, 2025)
Revenue and Profitability Analysis:
LG Balakrishnan’s Q1 revenue performance was driven by consistent demand for its transmission products, chains, and metal forming components.
- Domestic OEM demand remained stable, supported by recovery in the two-wheeler and passenger vehicle segments
- Export volumes showed resilience, particularly in Southeast Asia and Europe
- Net profit margin held firm due to low interest burden and efficient cost structure
- The company’s focus on high-margin products and operational efficiency contributed to bottom-line strength
Operational Efficiency and Cost Management:
The company continues to demonstrate strong financial discipline.
- Interest expenses were kept below 1 percent of operating revenue, reflecting a conservative capital structure
- Employee costs were well-managed at 16.55 percent of revenue, indicating productivity gains and lean staffing
- Manufacturing utilization improved across key plants, reducing per-unit costs
- Inventory turnover and receivables cycle remained healthy, supporting cash flow stability
Dividend and Shareholder Returns:
LG Balakrishnan has announced a dividend of Rs 20 per share, reinforcing its commitment to shareholder value.
- The dividend reflects confidence in future earnings and cash generation
- Record date for dividend entitlement is August 14, 2025
- The company’s consistent payout history enhances its appeal to long-term investors
Market Position and Strategic Outlook:
LG Balakrishnan continues to strengthen its position in the auto ancillary space through innovation and diversification.
- The company is investing in EV-compatible components to align with industry transition
- Expansion into new geographies and customer segments is underway
- Strategic partnerships with OEMs and Tier-1 suppliers are being deepened
- Analysts expect steady growth in FY26, supported by product innovation and export momentum
Stock Performance and Investor Sentiment:
The company’s stock has shown positive movement, reflecting investor confidence in its fundamentals.
- Share price rose 1.79 percent to Rs 1,297 on July 30, 2025
- Market capitalization stands at Rs 4,120.82 crore
- PE ratio of 13.66 and dividend yield of 1.55 percent indicate balanced valuation metrics
- Analysts maintain a strong buy recommendation, citing consistent earnings and sectoral tailwinds
Conclusion:
LG Balakrishnan & Bros has delivered a robust Q1 performance, with Rs 6.57 billion in revenue and Rs 669.7 million in net profit. The company’s disciplined cost structure, strategic focus, and shareholder-friendly policies position it well for sustained growth in FY26. As the auto industry evolves, LG Balakrishnan remains a reliable and agile player in India’s manufacturing landscape.
Source: Economic Times,
