Studds Limited incorporated in 1983 is the largest manufacturer of two-wheeler helmets in the world in terms of volume of two-wheeler helmets sold in Fiscal 2018 (Source: F&S Report). Their flagship brand Studds, the largest selling two-wheeler helmet brand in India has global presence in 21 countries as of June 30, 2018. In 2016 they launched premium helmet brand ‘SMK’, which has emerged as the leading brand with the largest market share in the premium two-wheeler helmet segment in India in terms of volume of premium two-wheeler helmets sold in Fiscal 2018. They are currently the only manufacturer of premium two-wheeler helmets in India (Source: F&S Report) and their SMK brand of two-wheeler helmets is marketed in 23 countries in Europe, Asia and Latin America as of June 30, 2018. Studds branded helmets constituted a share of 25.66% of the two-wheeler helmet market in India in Fiscal 2018.
Highlights of Financial
Performance:
· Revenue from operations has grown at a CAGR
of 12.5% from FY18-21.
· EBITDA Margin improved from 15.5% in FY18 to 23.04%
in FY21.
· PAT has grown at a CAGR of 31.04% from FY 18-21,
in FY 21 Company reported Profit of ₹73.99
Cr. from ₹ 74.55 Cr.
· Company reported ROE of 25.51% in FY 21.
· On consolidated basis company reported cash flow of ₹ 73.94 Cr. and free cash flow of ₹ 37.43 Cr. in FY 21.
Key Drivers for Growth:
1.
Rise in India’s young working population with the rising
levels of per capita income of people, the Indian two wheelers market offers a
huge potential for growth. This growth is relevant in the light of the fact
that 70% of India’s population is below the age of 35 years and over 150
million people will be added to the working population in the next five years.
2.
Growth of tier II/III cities and rural India and growing
middle income households Growth prospects of Indian tier II and tier III cities
and rural economy offer a significant opportunity for the two wheelers
industry. The penetration of motorcycles among rural households with income
levels greater than US $2,200 per annum has already increased to over 50%.
3.
Driven by extent of disposable income and greater affordability Growth in two
wheelers sales has been driven by an increase in affordability of these
vehicles. With greater avenues of financing, the customer’s capacity to own two
wheelers has improved.