Sundaram Clayton flags cost pressures

Sundaram Clayton Ltd (SCL), manufacturer of engineered aluminium diecast components for the automotive sector, said ongoing geopolitical developments in the Middle East continues to create uncertainty across global commodity and logistics markets.

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Increase in aluminium prices, energy costs, and freight rates are exerting pressure on input costs and operating margins, the company said in a statement.

As a result, the company’s EBITDA in the first quarter of 2026- 2027 declined to Rs 66.5 crore or 12.7 per cent from Rs 70.6 crore or 16 per cent in the same period last year.

SCL said it continues to remain vigilant to navigate the ongoing situation through monitoring evolving developments and proactively implementing measures to enhance supply chain resilience and ensure operational continuity.

The Indian automobile industry demonstrated resilient performance during Q1 FY2026– 27, supported by stable macroeconomic conditions, infrastructure-led investments, and sustained consumer demand, the company said.

The Commercial Vehicle (CV) segment registered steady growth driven by infrastructure, construction and replacement demand, while the Passenger Vehicle (PV) segment continued to witness healthy demand, particularly in SUVs and hybrid vehicles., it said.

Overall industry sentiment remained positive, although demand in select fleet segments remained measured, SCL noted.

On the export front, the company said the North American truck market showed a gradual recovery during the quarter, supported by improving fleet replacement demand, higher order intake, and increased OEM production schedules.

“While retail demand remained below peak levels, stronger order books and improved production outlooks indicate a positive momentum. However, elevated interest rates, softer freight conditions, and geopolitical and trade uncertainties continue to pose near-term risks,” it added.

Production across manufacturing facilities continues to ramp up in line with current customer requirements, positioning the business to support the expected recovery in North American truck demand, SCL said.

The company said it continues to accelerate the ramp-up of new product programmes across key platforms, while deepening customer partnerships.

 

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