Auto comp-Suspension/Braking/Wheels

Shock absorbers and struts, leaf and coil springs, brake linings, brake pads and friction materials, brake assemblies and control systems, and steel and alloy road wheels, supplied across two-wheeler, passenger, commercial and off-highway vehicles

The decisive structural feature is powertrain neutrality: every vehicle needs suspension, brakes and wheels regardless of what drives it, so unlike engine components this segment faces no obsolescence risk from electrification and participates in vehicle growth on both ICE and electric platforms, while safety-critical braking and suspension raise validation requirements and make OEMs slower to switch supplier

Product economics within the label vary widely: friction materials and brake linings are consumable wear parts with strong aftermarket pull and better margins, while road wheels and springs are closer to commodity metal forming competed largely on conversion cost

Customers are vehicle OEMs supplied on long-term platform contracts, plus an unusually large independent aftermarket for brake and suspension wear parts

The aftermarket is a genuine structural advantage here: brake pads, linings and shock absorbers wear out and are replaced multiple times over a vehicle's life, so revenue compounds with the growing national vehicle parc rather than only with new sales, and the aftermarket grew 9% in FY26 aided by rising used-vehicle ownership and repair-ecosystem formalisation

OEM price-down and counterfeit competition pressure the rest: the standard annual price-down applies and in commodity products such as road wheels there is little to defend price with beyond conversion efficiency, while aftermarket channels face unbranded and counterfeit friction material in a segment where the end customer cannot easily assess quality

Cost is dominated by steel, aluminium and friction-material formulations, plus forming, heat treatment and finishing energy, against moderately capital-intensive pressing, forming and machining assets

Friction know-how and aftermarket mix support margins: friction material carries genuine formulation know-how and testing validation supporting margins well above pure metal-forming work, and the aftermarket channel realises materially better pricing than OEM supply for the same product

Commodity input pass-through lags compress margin: steel and aluminium are a large share of cost and pass through to OEMs on a lag, so input spikes compress margin before indexation, while alloy wheel production is additionally exposed to aluminium and energy prices

Electrification changes engineering needs in offsetting directions: heavier battery packs increase suspension and braking loads and require upgraded components, but regenerative braking materially reduces friction pad wear over a vehicle's life, so the aftermarket consumable stream that supports margins faces slow structural erosion as the electric parc builds

Growth tracks vehicle production and the expanding vehicle parc, with additional content opportunity from heavier vehicles, larger wheel sizes and rising safety-feature specification

Powertrain neutrality captures the full industry growth rate: without the terminal-value discount applied to ICE components, and the FY26 industry backdrop was strong with component turnover up 12.7% and OEM supplies up 16.3%

Content per vehicle is rising through premiumisation: larger and heavier vehicles, bigger alloy wheels, disc brakes replacing drums and electronic braking systems all raise value per vehicle, and consumer preference has shifted decisively toward larger vehicles

Growth is closely tied to the vehicle cycle: with limited structural growth beyond it, and commercial vehicle-weighted suppliers carry the additional cyclicality of freight and infrastructure demand

A moderately fragmented segment with a few scaled specialists in shock absorbers, springs and friction materials, several with multinational technical collaborations, alongside smaller wheel and component makers

Barriers in friction material and braking are real: formulation know-how, safety-critical validation and regulatory approval take years, aftermarket brand recognition carries genuine pricing power, and scale in shock absorbers and springs amortises fixed testing and OEM-approval costs across more platforms

Barriers in road wheels and springs are low: competition is on conversion cost against both domestic peers and imports, and the aftermarket faces persistent unbranded competition

Principal risks are vehicle-cycle exposure, commodity pass-through lag and the slow erosion of friction-part replacement demand

Regenerative braking slowly erodes the aftermarket stream: electric vehicles substantially extend brake pad and lining life, so the aftermarket consumable revenue underpinning margins declines gradually as the electric parc builds- a slower and subtler threat than the one facing engine components, but real

Commodity lags and counterfeit competition add pressure: steel and aluminium price moves compress margin ahead of OEM indexation, CV-weighted suppliers carry freight-cycle cyclicality, and unbranded friction material competes on price where end customers cannot readily judge quality

Offsetting: the segment is powertrain-neutral and free of the obsolescence risk facing engine components, the growing vehicle parc supports a durable aftermarket, and premiumisation toward larger vehicles, bigger wheels and electronic braking raises content per vehicle