Gabriel India acquisitions broaden automotive technology portfolio and strengthen long-term growth drivers

Investment View and Business Overview

ICICI Securities’ July 23, 2026 company update on Gabriel India takes a positive view of the company. Its established suspension franchise is being complemented by diversification, group consolidation and acquisitions. Gabriel India is a global top-10 shock absorber manufacturer serving two-wheelers, three-wheelers, passenger vehicles, commercial vehicles, railways and the aftermarket.

The company’s FY26 revenue and channel mix was as follows:

Q1 FY27 Financial Performance

Standalone Q1 FY27 net sales rose 19% year on year to Rs 1,274 crore. EBITDA was Rs 107 crore, with the EBITDA margin at 8.4%, down 50 basis points quarter on quarter. PAT increased approximately 27% year on year to Rs 76 crore.

The sunroof business recorded about Rs 150 crore of sales at an EBITDA margin of roughly 11%. Hyundai production disruption caused by supplier issues temporarily affected the sunroof business. Management expects the lost production to be recovered over the next two quarters and does not expect a meaningful impact on FY27 guidance.

Management attributed broad revenue growth to strong suspension demand, aftermarket growth and the newly integrated chemical businesses. Margin pressure reflected input-cost inflation and a lag in OEM cost recoveries, with recoveries expected to normalise in the coming quarters. The report does not state whether the quarterly result beat, met or missed ICICI Securities’ estimates. Q1 FY26 figures were restated for the post-restructuring business portfolio to enable like-for-like comparison.

Diversification and Group Consolidation

The broker’s central strategic thesis is that premiumisation in suspension products, higher SUV penetration and rising content per vehicle will support the core business. Project RISE has expanded Gabriel India beyond its legacy suspension operations into driveline, adhesives and chemicals, reducing product concentration risk.

ICICI Securities also considers Gabriel India to be the ANAND Group’s listed automotive consolidation platform. Nearly 70% of ANAND Group automotive revenue is now housed under Gabriel India, and management intends to use Gabriel India as the primary vehicle for future consolidation towards the group’s Rs 50,000 crore revenue objective by 2030.

HL Mando and HL Klemove Acquisitions

Under Project Jupiter, Gabriel India plans to acquire a 28.99% stake in HL Mando ANAND India for Rs 2,231 crore through equity issuance and cash. It also plans to acquire a 30% stake less one share in HL Klemove India for approximately Rs 98 crore through a new joint venture.

HL Mando ANAND generated nearly Rs 5,886 crore of revenue and approximately Rs 358 crore of PAT in FY26. The acquisition adds braking and steering to Gabriel India’s suspension portfolio, creating potential for cross-selling, technology integration and stronger OEM relationships.

HL Klemove provides Gabriel India with exposure to advanced driver-assistance systems (ADAS). Management said HL Klemove already supplies Mahindra and Tata Motors and has a healthy order pipeline. ADAS content could range from Rs 20,000 to Rs 60,000–70,000 per vehicle, depending on the level of automation.

Funding and Leverage

Management expects around Rs 1,500 crore of debt funding for the HL Mando transaction alongside equity issuance. Post-transaction debt-to-equity is expected to be near 1:1.

Earnings Outlook

ICICI Securities forecasts standalone FY26P–FY28E sales and PAT CAGRs of 15.7% and 20%, respectively. Its standalone projections for FY27E and FY28E are set out below:

EBITDA margin is projected to improve from 8.7% in FY26P to 9.0% in FY27E and 9.5% in FY28E.

Valuation and Recommendation

ICICI Securities maintains its BUY recommendation and values Gabriel India at Rs 1,650 per share, based on approximately 40 times FY28E P/E.

The broker’s valuation builds to FY28E consolidated PAT of Rs 787 crore, comprising:

• Rs 350 crore of standalone shock absorber PAT;
• Rs 28 crore of apportioned sunroof PAT;
• Rs 254 crore of apportioned PAT from already restructured group companies; and
• Rs 155 crore of PAT share from HL Mando.

Applying 40 times to post-restructuring EPS of Rs 41 gives Rs 1,620 per share after adjustment for cash used for HL Mando. The broker adds Rs 30 per share for HL Klemove fair value, resulting in the Rs 1,650 target price.

Key Risks

• Sales ramp-up and integration benefits could be slower than expected.
• EBITDA-margin improvement over FY26P–FY28E could be weaker than expected.