Spark Minda, the Gurgaon-based auto parts manufacturer, is in talks with a few companies to explore buyout opportunities in the electric vehicle component space. The company is looking at buyouts that can be closed before the end of FY22, a top official said.
Formerly known as the Minda Group, Spark Minda, which already supplies parts to Bajaj Auto, TVS Motor Company, Revolt, Ola Electric and some start-ups, is looking to strengthen its EV presence.
Aakash Minda, Executive Director, Group Finance and Strategy, Spark Minda, said: “We have done a QIP (qualified institutional placement) and have about Rs 500 crore for any M&A or investment for new product lines that may be required. We are in discussions with a few companies but the details cannot be disclosed at this point. We are hopeful of closing something before the end of FY22.”
The management added that there is no need for further fundraising initiatives at this moment as the company feels it is sufficiently funded. As per its FY21 annual report, Spark Minda’s net debt to equity stood at 0.01. Its net debt at the end of FY21 stood at Rs 16.2 crore. The company’s FY21 operating revenue stood at Rs 2,368 crore while its net profit for the same year stood at Rs 53 crore.
Spark Minda is developing a complete electric vehicle component kit worth Rs 25,000-30,000 that can be used in electric two-wheelers. It includes sensors, a central cluster, DC/DC converter, locking system, charger and telematics.
The company had set up a 100 percent subsidiary called Spark Minda Green Mobility Solutions engaged in battery, battery management system, motor and motor controller supplies, which make up 60 percent of the cost of an electric two-wheeler. This subsidiary inked a definitive agreement early this month to acquire 26 percent equity in EVQPOINT Solutions, a start-up engaged in EV charging solutions.
Keyless start/stop, mostly seen in premium cars, is one of several next-generation tech-heavy products that the group is working on. This technology can make use of a smartphone to unlock a two-wheeler, thereby completely doing away with the manual key and lock function of today.
Such a feature will not only be seen on EVs but will be offered on premium petrol-powered two-wheelers also. Minda says that these technologies, which are under development, will be seen on some bikes in about six months.
“As soon as you approach a vehicle it will unlock itself using the phone and no key is needed. The rider just has to press the start button and the vehicle is ready for use. There can be multiple access codes for different individual riders. One merchant establishment can share these codes with multiple delivery boys for one vehicle. And these codes cannot be duplicated or changed because they come with lots of security,” Minda added.
Electric vehicles are fast gaining traction in India because of their low running cost, easy maintenance and the rising cost of fossil fuel. India is currently witnessing growth in demand for high-speed premium electric two-wheelers and four-wheelers. Demand for electric three-wheelers for cargo and passenger use is also coming back on stream after the disruption caused by Covid-19.