Dhoot Transmission is among the top two players in India's 2W and 3W wiring harness market, with a 41% market share.
Jefferies expects the company to deliver a 24% revenue CAGR and 27% EPS CAGR over FY26-29E, supported by stronger two-wheeler volumes, higher content per vehicle and growth in newer products.
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EV exposure gives Dhoot an edge
The brokerage sees electrification as one of the biggest structural opportunities for Dhoot Transmission. Wiring harness content in an electric two-wheeler is around 1.5-2.5 times that of an entry-level ICE vehicle, while the company has around 70% market share in electric 2W and 3W wiring harnesses.EVs contributed 24% of Dhoot Transmission's FY26 revenue, rising to 27% in Q1 FY27. The company expects this contribution to reach 30-32% over the next 2-3 years. Jefferies said the company also has strong exposure to premiumisation, with premium 2Ws and EVs accounting for 57% of its FY26 2W revenue.
Beyond wiring harnesses
Dhoot Transmission's growth story is also expanding beyond its core wiring harness business. Wiring harnesses accounted for 77% of FY26 revenue, while the remaining 23% came from battery packs, sensors, controllers and switches.Battery packs have emerged as the largest product category after wiring harnesses, while the acquisition of Multilink has expanded Dhoot Transmission’s portfolio to sensors and relays and added Hero MotoCorp as a new customer.
The company is also exploring ADAS through a proposed Ride Vision joint venture, along with EV charging products, power electronics and high-voltage systems.
Jefferies expects these initiatives, alongside capacity expansion, to support 24% revenue growth over FY26-29E. It expects EBITDA and EPS to grow at 23% and 27%, respectively, during the period.
Valuation and risks
Jefferies acknowledged that Dhoot Transmission's 43x one-year forward PE appears rich, but said it is justified by the company's growth profile and franchise. Its Rs 1,730 price target is based on 42x September 2028E EPS.Also read: HDFC Bank’s all-rounder CEO: Can Bagchi steer banking giant?
The key risks include weaker two-wheeler demand and slower electrification. The brokerage also flagged a potential supply overhang, with private equity investors holding a 42% stake in Dhoot post-IPO.
Disclaimer: This article has been written by Sakshi Kumari, who is not a SEBI-registered Research Analyst or an Investment Adviser. Sakshi Kumari and her ‘relative(s)’ (as defined under Section 2(77) of the Companies Act, 2013) do not hold any financial interest in the companies mentioned in this article as of the date of publication. The views/recommendations mentioned in this article, wherever applicable, are those of the respective SEBI-registered Research Analyst/brokerage and have been reproduced/reported with due attribution. They should not be construed as the views or recommendations of The Economic Times Digital or the journalist. Readers are advised to consider the original research report and make their investment decisions based on their own assessment. Brokerage disclaimers here
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