Belrise Industries in an overdrive
“When grow up, I want to be a Mercedes,” reads a sticker on a small car. Ask auto component entrepreneur Pune-based Shrikant Shankar Badve of Belrise Industries Ltd (BIL) as to what his ultimate target is, pat comes the answer: “I want my company to be a ‘one-stop shop’ for OEMs, developing comprehensive supplier capabilities from design to production and after-sales service”.
“Right from the beginning, I wanted to be a job-provider rather than being job-seeker,” says Badve, founder-managing director, BIL, as he narrates his three-decade-long success story from a two-worker, three-machine set-up in a 150 sq ft place to a Rs7,500 crore company servicing 27 OEMs globally, with 15 manufacturing facilities across nine cities in eight states, pan-India.
Life was tough for Badve, hailing from a middle-class family from Pune, as he set out to be on his own, armed with a BE from Babasaheb Ambedkar Marathwada University, Aurangabad (now Chatrapati Sambhaji Nagar). His father, an engineer; and mother, a housewife, did not interfere; they gave him the freedom to pursue what he liked. At the age of 22, he began making nuts, bolts and washers for Bajaj Auto as a Tier II supplier with a princely turnover of less than Rs1 lakh a year. No bank would give him money without any collateral. But he managed to convince Saraswat Co-operative Bank for a Rs5 lakh loan for his expansion.
There was no looking back after that, as life was on a fast track with “sheer hard work and dedication”, he recalls. “I learnt a lot from Bajaj Auto as well the family”, he says, “and Rajiv Bajaj asked me to start making silencers for their Mop-ed Sunny. Badve jumped at the offer and imported machinery from Shenzhen in China.
Today, Belrise’s automotive product portfolio comprises over 1,000 distinct products across chassis systems, exhaust systems, body-in-white parts, polymer components, battery containers, suspensions and steering columns. The company has emerged as Bajaj Auto’s largest sheet metal and fabricated parts supplier and the first supplier to set up a cathodic electro-deposition plating facility, which is supplemented by an IoT system to enable real-time monitoring of production. It is also the primary supplier of chassis frames for their electric three-wheeler model.
Belrise quickly added Honda Motorcycle & Scooter India, Tata Motors and Jaguar Land Rover to its portfolio. It supplies both plastic and metal components to Honda Motorcycle and Scooter India and makes the complete chassis system for one of their two-wheelers. For Tata Motors, Belrise supplies complete frame assembly for one of their commercial vehicle platforms. It has also been selected to assist in developing and producing chassis for one of Tata Motors electric vehicle platforms.
Family business
For Jaguar Land Rover, Badve’s Belrise has exported more than 190 different components to their facilities in Austria, Slovakia and the UK as a single-source supplier. It also supplies parts for Jaguar’s electric and hybrid vehicle models. Badve has roped in his wife Supriya and sons Sumedh and Swastid into Belrise, making it a family business with professionals’ participation.
Supriya Shrikant Badve, 55, whole-time director, who holds a master’s degree in science from Amravati University, is primarily responsible for overall business management. “We supply our customers a diverse range of products specifically designed for electric vehicles,” she says. “These products include steering columns for Bajaj Auto’s electric two-wheeler, complete underbodies for Tata Motors’ commercial vehicle models, body-in-white parts and cross car beams for a large OEM’s electric SUV models, and accessories for Honda Motorcycle & Scooter India’s e-Active model”.
Talking of Belrise’s global operations, Sumedh says the company’s key markets include Austria, Slovakia, the UK, Japan and Thailand. The company enjoys a market share of 24 per cent in the overall two-wheeler metal components segment in India, Sumedh holds a bachelor’s degree in science (mechanical engineering) from Purdue University and a master’s in business administration from Harvard University. “Over the years, we have gained a deep understanding of our customers’ requirements, enabling us to develop complex products with quick turnaround times,” he says quoting a CRISIL report. “The rigorous testing and validation processes and established long-term OEM contracts impose barriers for new entrants, further strengthening the industry’s competitive edge. Typically, OEMs prefer multi-product vendors as they provide consistent quality standards and a rationalised supply chain network, further complicating the entry of new entrants into the market.”
“We have also implemented a ‘just-in-time’ inventory model that optimises our inventory levels and enhances our ability to meet our OEM customers’ needs with agility,” says Swastid Badve, chief of staff to the MD’s office. He too has dual degrees – in economics and engineering from University of Pennsylvania. He worked with McKinsey & Co before joining the family business.
In 2023-24, the company has sub-assembled a variety of vehicle models for Bajaj Auto, says Sunil Govind Kulkarni, chief marketing officer & vice-president, BIL. “We also have the distinction of being the first supplier to establish a cathodic electro-deposition plating facility for Bajaj Auto”. The company has received 26 awards for quality at its manufacturing facilities.
Revenue in good shape
Belrise deploys over 700 robots for fabrication to ensure low defect parts per million and high predictability. “We design, develop and make a variety of suspension components, including shock absorbers, springs, forks and steering columns, through precision machining, casting, or forging processes. We have received one patent for our suspension designs,” he adds.
On the company’s financials, Rahul Shashikant Ganu CFO, BIL, informs that, between 2021-22 and 2023-24, Belrise’s revenue has grown at a CAGR of 18.17 per cent. “With sufficient installed capacity at our manufacturing facilities and access to land in key automotive hotspots across India, we are well-equipped to scale our production volumes in response to customer demand. This allows us to effectively capitalise on the expanding markets for two-wheelers, four-wheelers and commercial vehicles within the country,” says Ganu, who rose from the ranks in Belrise, having joined as an assistant manager in 2003. He holds a bachelor’s degree in commerce from the Marathwada University and a master’s degree in business administration from Institute of Management Education, Pune.
For 2023-24, the company’s revenue from operations was Rs7,484.2 crore, increasing from Rs6,582.49 crore for 2022-23 and Rs5,396.85 crore for 2021-22, growing at a CAGR of 18.17 per cent during the two years, according to Ganu. For the three months ended 30 June 2024, revenues from operations stood at Rs1,780.97 crore, with profit after tax touching Rs71.58 crore.
Belrise Industries is going public, having obtained the final observations on its Draft Red Herring Prospectus (DRHP). The IPO with the face value of Rs5 per equity share, is entirely a fresh issue of up to Rs2,150 crore with no offer for sale component. The company, in consultation with the lead managers, may go for a pre-IPO placement of Rs430 crore and plans to utilise a portion of the net proceeds (to the extent of Rs1,618.08 crore) for clearing its dues.
“Our commitment and focus towards ESG will continue increasing going forward as we plan to expand our portfolio of electric vehicle and renewable energy products,” says Badve Senior. “As part of our growth strategy, we intend to expand our portfolio of electric vehicle and renewable energy products,” he adds.
Belrise is establishing a manufacturing facility in Pune to develop capabilities to make hub motors and chargers for electric vehicles. It also plans to work towards increasing the content per vehicle for two-wheelers to 20-25 per cent for electric vehicles from the current level of 10-15 per cent, by entering proprietary segments such as motors, motor controllers and chargers for electric vehicles and exploring potential joint venture associations with prominent electric vehicle component manufacturers. The motor, motor controller and charger together constitute 15-20 per cent of the overall electric two-wheeler cost.
“We have recently begun manufacturing exhaust systems specifically designed for CNG-powered vehicles,” informs Badve. “Going forward, we intend to further develop and commercialize exhaust systems for CNG-powered vehicles”. Being a chess player, he does move his knight well!