Sumax Engineering Eyes Its Next Growth Phase With IPO-Funded Expansion

Founded in 1994, Sumax’s journey began when India’s economy was opening up and the automotive industry was emerging as a significant opportunity. Mehta, who completed his master’s from Symbiosis Institute of Business Management in 1992, spent three years working with his father’s distribution business before starting Sumax. That experience, particularly his exposure to automotive and industrial companies, shaped his decision to enter the sector.

IPO to Support the Next Leg of Expansion

Sumax currently operates manufacturing facilities in Chennai and Manesar and has developed a pan-India distribution and business presence. According to Mehta, the company has acquired land for two additional facilities and secured construction approvals.

The expansion will substantially increase Sumax’s manufacturing footprint. From approximately 55,000 sq. ft. currently, the company plans to add around 1.10 lakh sq. ft., taking its total footprint to approximately 1.65 lakh sq. ft.

Mehta said the company requires around ₹21.5 crore towards plant and building requirements, in addition to working capital. Relying entirely on debt for an expansion of this scale was not considered advisable, making the IPO a more suitable route.

“It’s all about timing, what is best for the growth of the company,” Mehta said, adding that a public listing also brings stronger systems, greater transparency and an improved ability to attract talent.

Both upcoming facilities are expected to become operational by early 2027, while capacity utilisation will increase progressively. Mehta expects the expansion to reach its intended operating potential by around 2029.

Focus on Profitability and Product Mix

The expansion comes at a time when Sumax has been improving profitability despite relatively modest revenue growth. Revenue from operations increased from ₹146.13 crore in FY25 to ₹147.69 crore in FY26, while PAT rose from ₹9.98 crore to ₹12.76 crore and EBITDA margin improved from 10.21% to 12.86%.

Mehta attributed the improvement to initiatives undertaken over the past three years across product mix, customer selection, procurement optimisation, shipping costs, production processes and innovation.

The company is currently operating at around 85% to 100% capacity utilisation, depending on the product. Mehta believes there is further scope for margin improvement, while noting that serving automotive OEMs requires Sumax to maintain additional capacity to respond to production increases and just-in-time supply requirements.

Deeper OEM Relationships, New Growth Categories

Nearly 97% of Sumax’s FY26 revenue came from existing customers. Mehta, however, sees substantial room to grow within these relationships. The company has spent the past decade establishing direct relationships and vendor codes with automotive OEMs and is now targeting opportunities across production lines, spare parts, accessories and value-added services.

Large OEM relationships, he explained, can generate business across multiple departments and offer significant recurring volumes. Sumax therefore intends to deepen existing relationships while selectively pursuing new customers and products.

Paint Protection Film (PPF) is one category Sumax expects to emerge as a meaningful growth opportunity. As consumers increasingly focus on vehicle protection, appearance and maintenance, Mehta sees strong potential for PPF and related services.

Sumax currently has around 1,100 distributors and more than 100 service providers across India. Its existing relationships with automotive companies and experience in providing value-added treatments through workshops could support expansion in the category. PPF is also a relatively high-ticket business involving application, maintenance and associated consumables, creating opportunities beyond the sale of the film itself.

Exports on the Growth Radar

Automotive OEMs currently contribute roughly 60–70% of Sumax’s business, while the company also sees opportunities in auto refinish as India’s installed base of cars and two-wheelers continues to expand.

Exports could become another important growth engine. Sumax already exports to a few countries and works with several global automotive OEMs in India. Mehta believes approvals and product specifications secured with these manufacturers domestically can potentially open opportunities in their overseas operations.

Until now, Sumax has not pursued exports on a large scale because international expansion requires additional infrastructure and servicing resources. The upcoming facilities, Mehta said, should give the company the resources to pursue global opportunities more aggressively.

Moving From ‘Bungalows to Towers’

At the heart of Sumax’s medium-term strategy is a sharper focus on products capable of generating better returns and larger volumes. Mehta describes this approach as moving from “bungalows to towers.”

The company once carried as many as 15,000 SKUs while building its market presence. It is now looking to reduce complexity and concentrate on products and relationships capable of generating greater revenue and returns.

The strategy, Mehta said, will remain centred on choosing the right products, optimising inventory and working capital, improving the product mix and pursuing larger-volume opportunities. With additional manufacturing capacity, deeper OEM relationships, emerging categories such as PPF and a greater focus on exports, Sumax is positioning its IPO as a platform for its next phase of growth.

Disclaimer: This article is for informational purposes only and does not constitute financial advice.