A 26-year-old Indian company is not something you would immediately associate with electric vehicles, a business teeming with plucky startups. But the Blackstone-backed Sona Comstar couldn't be better placed to take advantage of the global EV transition. Three-quarters of the auto components maker's US$210 million revenue in the year ended March 2021 came from outside India. And EVs account for 60% of its US$1.8 billion order book.
And while Sona counts six of the world's top 10 carmakers among its customers, its calling card is its third-biggest client–Tesla. These impressive stats have helped Sona's shares more than double since its US$725 million initial public offering in June this year. The company is now worth US$6 billion. Aided by India's US$3.4 billion production-linked incentive scheme, Sona now wants to be a force to reckon with in the local EV components market too. But, Sona's ride here is bound to be a lot bumpier than overseas.
For one, EVs are still less than 1% of India's vehicle sales. And Sona has some fierce competition from Bharat Forge, which has invested in a slew of EV startups in Europe and India, and Motherson Sumi, which plans to spend US$260 million to scale its EV business in 2022. But Sona cannot slow down or veer off-course if it has to meet the enormous expectations baked into its stock price VFX Studio