Uno Minda Q3 Profit Jumps 18%; Announces ₹764 Cr Capex

Introduction

Auto components manufacturer Uno Minda Ltd announced a strong performance for the third quarter of fiscal year 2026, reporting an 18.13% year-on-year increase in consolidated net profit. The positive results, coupled with a major capital expenditure announcement of ₹764 crore for a new manufacturing facility, spurred a recovery in its stock price on February 5, 2026. The company's board also declared an interim dividend, signaling confidence in its financial health and growth trajectory.

Strong Consolidated Financial Performance

For the quarter ending December 31, 2025, Uno Minda's consolidated revenue from operations grew by a robust 20% to ₹5,018.06 crore, compared to ₹4,183.99 crore in the corresponding period of the previous fiscal year. This top-line growth was driven by strong sales across its product lines. The company's earnings before interest, taxes, depreciation, and amortization (EBITDA) increased by 21% to ₹554 crore from ₹457 crore a year earlier. The EBITDA margin saw a marginal improvement, expanding to 11% from 10.9%, indicating stable operational efficiency despite rising expenses. Consolidated net profit for the quarter stood at ₹300.48 crore, a significant rise from the ₹254.37 crore posted in Q3 FY25.

Standalone Results and Exceptional Items

On a standalone basis, the company's performance presented a more nuanced picture. Revenue from operations surged by 19.46% year-on-year to ₹3,746.62 crore. However, net profit experienced a slight decrease of 0.68% to ₹156.20 crore from ₹157.26 crore in the year-ago quarter. This dip in standalone profit was attributed to exceptional items totaling ₹35.18 crore. These one-off costs were primarily due to an impairment provision and the financial impact of implementing new Labour Codes, which affected the bottom line despite strong operational revenue.

Key Financial Metrics (Q3 FY26)

Strategic Expansion: ₹764 Crore Alloy Wheel Plant

A key highlight of the announcement was the board's approval for setting up a new alloy wheel manufacturing facility in Chhatrapati Sambhajinagar, Maharashtra. The company has earmarked a capital expenditure of ₹764 crore for this project. The new plant is designed to have an annual capacity of up to 1.8 million alloy wheels, which will be achieved in a phased manner. Management stated that this expansion is driven by strong business growth and increasing demand from Original Equipment Manufacturers (OEMs). The project will be financed through a combination of debt and internal accruals, and operations are expected to commence by the second quarter of 2027.

Shareholder Returns and Market Reaction

Reflecting its strong financial position, Uno Minda's board approved and declared an interim dividend of ₹0.90 per equity share (45% of face value) for the financial year 2025-26. The record date for determining shareholder eligibility for the dividend has been set for February 11, 2026. The market responded positively to the robust earnings and strategic expansion plans. After hitting an intraday low of ₹1,176, the shares of Uno Minda recovered sharply following the announcement, closing 1% higher at ₹1,218.6 on the day.

Analysis: Investing for Future Growth

The Q3 results demonstrate Uno Minda's ability to drive strong top-line growth at the consolidated level. The significant investment in the new alloy wheel plant is a clear strategic move to capitalize on sustained demand in the automotive sector. While the standalone profit was impacted by exceptional costs, the core business operations remain strong. The company's consolidated debt-to-equity ratio remained prudent at 0.20 as of December 31, 2025, indicating a healthy balance sheet capable of supporting the planned expansion without excessive leverage. The key risk ahead will be the timely execution of the large-scale capex project and managing its integration into the existing operations.

Conclusion

Uno Minda's third-quarter performance for FY26 underscores a period of robust growth and strategic investment. The strong consolidated profit and revenue figures, combined with the ambitious ₹764 crore expansion plan, position the company to meet future OEM demand effectively. While investors will monitor the impact of exceptional costs and the execution of the new project, the overall outlook remains positive, as reflected in the favorable market reaction. The company's focus on capacity enhancement is a strong indicator of its confidence in the long-term prospects of the Indian automotive industry.