About Forge Auto International Limited

Forge Auto International is an engineering company engaged into forging and manufacturing of complex and safety critical, forged and precision machined components such as big ring, small ring, big ball stud, gear blank with broach, stub axle assembly, flange yoke 325 HS, catering to different industry sectors like auto industry including automobiles, tractors, railways etc. and non-auto sectors like agriculture parts, hydraulic parts, striking tools etc. They primarily serve their customers comprising of domestic and global original equipment manufacturers (“OEMs”) engaged into manufacturing for both automotive sector and other nonautomotive sector, used across industries by a diversified base of customers.

They manufacture precision machined components as per customer specifications and International Standard catering to the requirements of various industry such as tractor, agriculture parts, railways, automobiles, commercial vehicle industry, 5th wheel industry, striking tools, hydraulic parts and castor wheel parts and other related industries. They also manufacture products such as short fork 325HS, long fork, flange yoke 325 HS used in commercial vehicles, ball stud, small ball stud used in railway bogies, gear blank with broach, gear blank without broach, stub axle assembly used in tractors, agricultural equipment, sledge hammers etc. Their product range can be broadly classified into different categories i.e. Automotive sector (i.e. used in the manufacturing of auto components such as tractors, light vehicles, heavy commercial vehicles etc.) and non- automotive sector (i.e. which are used in manufacturing of agricultural, industrial and striking tools etc.).

AUTOMOBILE SECTOR OUTLOOK
• The automobile component industry turnover stood at Rs. 5.6 lakh crore (US$ 69.7 billion) between 2022-23 the industry had revenue growth of 32.8% as compared to 2021-22. 
• Domestic OEM supplies contributed ~66% to the industry’s turnover, followed by domestic aftermarket (~12%) and exports (~22.3%), in FY23. 
• The component sales to OEMs in the domestic market grew by 39.5% to US$ 57.62 billion (Rs. 4.76 lakh crore). 
• Between 2022-23, exports of auto components grew by 5.2% to Rs. 1.61 lakh crore (US$ 19.49 billion). As per the Automobile Component Manufacturers Association (ACMA) forecast, automobile component exports from India are expected to reach US$ 30 billion by 2026. In FY22, India’s auto component Industry for the first time reached a trade surplus of US$ 700 million. 
• The aftermarket for auto components grew by 15% in 2022-23 reaching Rs. 85,333 crore (US$ 10.33 billion).
• Exports of auto components grew by 5.2% to Rs. 1.61 lakh crore (US$ 19.49 billion) in 2022-23 from Rs. 1.41lakh crore (US$ 19 billion) in 2021-22. In 2023-24 (April-July), the export value of auto components/parts was estimated at US$ 2.46 billion. 
• North America, which accounts for 32% of total exports, increased by 8%, while Europe and Asia, which account for 31% and 26% of total exports, increased by 3% and 4%, respectively. The key export items included drive transmission and steering, engine components, body/chassis, suspension and braking etc. 
• Exports of automobile components from India increased, at a CAGR of 11.89%, from US$10.83 billion in FY 16 to US$ 19 billion in FY22. 
• Auto component exports increased by 8.6% in H1 23 to US$9.6 billion (Rs.79,033crore) from US$8.3 billion (Rs.68,746crore) in H1 2021-22.
• The aftermarket for auto components grew by 15% in 2022-23 reaching Rs. 85,333 crore (US$ 10.33 billion). 
• By 2026, the automotive aftermarket segment in India is expected to reach US$ 32 billion. 
• India’s auto components aftermarket witnessed a 15% growth from US$ 8.70 billion in FY21 to US$ 10 billion in FY22. 
• Aftermarket turnover increased at a CAGR of 8.02% from US$ 8.70 billion in FY16 to US$ 10 billion in FY22 and is expected to reach US$ 32 billion by 2026. 
• The ‘Drive Transmission and Steering’ product category accounted for 21% of the aftermarket share followed by ‘Engine Components’, and ‘Electricals and Electronic Components’ with 19% and 18%, respectively. 
• To support local auto parts suppliers, the auto component sector has tied up with Tesla to manufacture electric vehicles in August 2021.

FORGE AUTO INTERNATIONAL LIMITED COMPETITIVE STRENGTHS
1. Integrated manufacturing operations with diversified product portfolio
2. Long-standing relationship
3. Experienced Promoters and senior management team
4. Quality Assurance and Standards
5. Track record of healthy financial performance

FORGE AUTO INTERNATIONAL LIMITED STRATEGIES
1. Expand our presence in the forging market
2. Focus on consistently meeting quality standards
3. Focus on Advanced Products
4. Expand capacity at our existing manufacturing facilities

FORGE AUTO INTERNATIONAL LIMITED RISK FACTORS & CONCERNS
1. They depend on a few suppliers for the supply of steel, their primary raw material.
2. The business is dependent on the performance of certain other industries which they are serving particularly automobile, tractors, railways, farm equipment etc.
3. The company has been recently formed by conversion of the erstwhile Partnership firm into the company, thus they have limited operating history as a Company which may make it difficult for investors to evaluate their historical performance or future prospects.
4. They depend on a limited number of customers for their revenue from operations.
5. They derive certain portion of the revenues from exports and are subject to risk of international trade.