1:10 stock split: Automotive components manufacturer forms JV with Taiwan-based SmartChip Microelectronic Corporation (SMC)

Pavna Industries Limited, a prominent manufacturer of automotive components, has entered into a joint venture (JV) agreement with SmartChip Microelectronic Corporation (SMC), a Taiwan-based company. This JV aims to develop and manufacture electronic components for the automotive industry (both ICE and EV), as well as hardware for residential and commercial locks, aerospace and medical applications. Pavna will leverage its operational, manufacturing and procurement expertise, along with its deep understanding of the Indian automotive market, to manage the JV's operations in India.

SMC will contribute its current and future technical skills, innovations and R&D capabilities, specifically in areas such as automotive e-lock systems, EV components (including Motor Controllers, Throttle Bodies and Dashboards for 2-wheelers and 3-wheelers), EV charging piles and e-locking solutions for residential and commercial use. This collaboration ensures the JV remains technologically advanced and globally competitive. In terms of equity, Pavna Industries Limited will hold an 80 per cent stake in the JV, while SMC will hold 20 per cent.

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About the Company

Pavna Industries Limited, established in 1994, is a prominent manufacturer of high-quality automotive parts such as Ignition Switches, Fuel Tank Caps and Oil Pumps, serving major OEMs including Bajaj, Honda, TVS and Royal Enfield. The company conducts extensive R&D, including collaborations with Sunworld Moto Industrial Co and exports to countries like Italy, the USA and Bangladesh. Its subsidiary, Pavna Sunworld Autotech, has commenced supplying oil pumps to Hero MotoCorp Ltd for its Splendor and Glamour models, aiming for 50,000 units monthly within 3-4 months. Pavna Industries has also expanded its land holding to 9.6 acres near Jewar Airport to support long-term growth and a broader client base.

Pavna Industries Limited has approved a 10-for-1 stock split. This means that for every one share currently held with a face value of Rs 10, shareholders will soon have ten shares, each with a face value of Re 1. The record date for the stock split is fixed as Monday, September 01, 2025. According to Quarterly Results, the company reported net sales of Rs 66.23 crore and net profit of Rs 1.82 crore in Q4FY25 while in its annual results, the company reported net sales of Rs 308.24 crore and net profit of Rs 8.04 crore in FY25.

As of June 2025, Promoters own 61.50 per cent stake, FIIs own 6.38 per cent stake and the remaining 32.12 per cent stake is owned by public shareholders. The company has a market cap of over Rs 500 crore. The shares of the company have a PE of 75x, an ROE of 5 per cent and an ROCE of 10 per cent. The stock is up 44 per cent from its 52-week low of Rs 295.20 per share.

Disclaimer: The article is for informational purposes only and not investment advice.