Steel Strips Wheels sees steel wheel revival, lifts capex to ₹650 cr, delays knuckle
Revenue up 27%, EBITDA per wheel hits ₹314. Management guides 20% full-year growth but holds off on guidance upgrade until Q2. The real surprise: steel wheels after 15 years of decline.
— 4 earlier stories on Steel Strips Wheels Ltd. →What's new
- Steel wheel segment enters growth phase after 15 years of decline.
- Capex guidance raised to ₹600-650 cr from ₹460 cr for new brownfield and Bhuj projects.
- Aluminum knuckle trial production delayed to Q4 FY27.
Why this matters
The steel wheel reversal is a structural surprise that justifies the capex hike, but the aluminum knuckle delay tempers the growth narrative. Management's decision not to upgrade full-year guidance despite a strong Q1 signals caution about sustainability.
What we're watching
- Whether the steel wheel growth sustains in Q2.
- Timeline for aluminum knuckle trials and production.
- Capex execution and margin impact.
The full read
Steel Strips Wheels delivered a strong Q1: revenue up 27%, EBITDA per wheel up ₹50 to ₹314, and a 43% jump in standalone net profit to ₹71.5 crore (as reported last week). But the real surprise on the concall was the steel wheel segment: after 15 years of decline, it is now growing again. That reversal convinced management to lift capex guidance to ₹600-650 crore from ₹460 crore, funding a brownfield agricultural wheel expansion and the Bhuj alloy wheel and knuckle projects. The caution flag: the aluminum knuckle trial has slipped to Q4 FY27, and full-year guidance ( 20% revenue growth, EBITDA per wheel above ₹310 ) stays unchanged until Q2. The capex hike signals confidence in the steel wheel rebound; the delay and restrained guidance say that confidence is not yet across the board. Market cap ₹3,618 crore, trailing P/E 19, ROE 12%, debt/equity 0.51 — the valuation is reasonable if the steel turn is real, but the knuckle delay reminds that two big bets (steel revival and alloy growth) are on different timelines.
Questions answered
- Why did SSWL raise its capex guidance so significantly?
- The company added a brownfield agricultural wheel expansion and proceeded with the Bhuj alloy wheel and knuckle projects. Management sees a surprising turnaround in steel wheels after 15 years of decline, which warrants higher investment.
- What drove the steel wheel segment's reversal?
- Management described it as a surprising reversal after 15 years of decline, but did not give specific drivers on the call. The segment is now entering a growth phase, contributing to the upbeat tone.
- Why was the aluminum knuckle timeline delayed?
- Management acknowledged a delay in the trial production timeline, now expected in Q4 FY27. No detailed reasons were provided on the call.
- Why didn't management upgrade full-year guidance despite strong Q1?
- The company wants to see Q2 results before upgrading. Revenue growth is guided at 20% and EBITDA per wheel above ₹310, but the cautious stance suggests management is not yet certain about sustainability of the Q1 strength.
- How does the new capex compare to the company's existing debt level?
- The company's debt/equity ratio is 0.51, so the increased capex of ₹600-650 cr will likely be partly debt-funded. The impact on leverage depends on the phasing of spending and cash flows.
- What is the implied capacity addition from the new capex?
- The filing does not provide specific capacity figures. The capex covers a brownfield agri wheel expansion and the Bhuj alloy wheel and knuckle projects, which are expected to boost production in both steel and alloy wheels.
Steel Strips Wheels Ltd.
Latest quarter · Jun 2026
Strength & growth
Story so far
All notes on SSWL →- 16 Jul 2026 · 10:59 AM IST Steel Strips Wheels sees steel wheel revival, lifts capex to ₹650 cr, delays knuckle
- 1d ago Steel Strips Wheels Q1 profit jumps 43% to ₹71.5 cr
- 1d ago Steel Strips Wheels Q1 profit jumps 43% to ₹71.5 cr
- 29d ago Steel Strips Wheels pays ₹1.7 cr Customs notice before it's even issued
- 41d ago SSWL sets ₹650 cr EBITDA target for FY27, plans ₹500 cr Bhuj plant