Shanthi Gears Limited
Know the Company
Shanthi Gears Limited (SGL) is a leading company in the industrial gear manufacturing, renowned for its high-quality and customized gear solutions. Established in 1969 at Coimbatore, the company initially focused on small gears but has since expanded its offerings, making it a prominent player in the industry. In 2013, Shanthi Gears became a subsidiary of Tube Investments of India, part of the Murugappa Group—one of India’s largest industrial conglomerates.
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Product Portfolio:
Shanthi Gears produces high-quality industrial gears and power transmission solutions. Offering a comprehensive portfolio, the Company provides helical gears, bevel gears, worm gears, geared motors, and custom-built solutions that address the unique needs of clients across multiple sectors. With expertise in customization, the company tailors its products to meet specific torque and speed requirements, serving industries such as cement, steel, mining, power generation, and textiles.
Among its product offerings, Shanthi Gears’ worm gearboxes stand out for their smooth, quiet operation, ideal for low-speed, high-torque applications like material handling and conveyor systems. Its planetary gearboxes, known for compact and powerful performance, are designed for heavy-duty equipment like cranes and excavators. Additionally, Shanthi Gears’ geared motors combine electric motors with precision gear mechanisms, making them suitable for packaging, textiles, and food processing industries where efficiency and motion control are essential. For clients with specialized requirements, Shanthi Gears offers custom-built gear solutions, crafted to meet demanding applications in sectors such as marine, aerospace, and industrial automation. The company also provides spare parts and maintenance services, ensuring long-term reliability and optimal performance.
With manufacturing operations spread across six units, including a foundry division, Shanthi Gears consistently delivers precision-engineered solutions to meet diverse industrial needs. Today, it stands as a pioneer in gear manufacturing, ranked among India’s top gear producers.
Strengths
SGL is a prominent player in India’s precision engineering and industrial gears market, renowned for its commitment to innovation, quality, and reliability. With over four decades of expertise, SGL has established a solid reputation as a trusted provider of high-quality gear and gearbox solutions, serving some of the largest industrial names. SGL’s product portfolio allows it to cater to diverse sectors like mining, power, steel, and other heavy industries. This variety helps SGL reduce reliance on the auto sector and expand its presence in high-value segments.
One of India’s leading business houses, the Murugappa Group, took over the company in 2012 from its previous management under Subrahmanyam, known as the “Gear Man of India”. As one of the largest organized players in the gears segment in India, SGL benefits from its affiliation with the Murugappa Group, which provides significant financial, management and operational support.
SGL’s commitment to rigorous quality standards is evident in its advanced manufacturing capabilities and dedicated research and development (R&D) team. Through continuous investment in technology, the company delivers durable, high-performance products that meet the stringent requirements of its customers’ applications. SGL is particularly strong in the customized solutions market, offering tailored gear solutions and specialized gear reconditioning services that support greater customer retention and satisfaction. Known for its customer-focused approach, SGL consistently prioritizes innovation and a deep understanding of its clients’ needs, resulting in reliable, high-quality products that enhance operational efficiency across industries.
Opportunities
SGL is a distinguished manufacturer of industrial gears and power transmission solutions, serving a diverse range of industries that demand precision, reliability, and robust mechanical components. The company’s product offerings span helical gears, bevel gears, worm gears, and custom-built gear solutions, each designed to meet the complete demands of sectors like cement, power, mining, steel, and railways. In the cement industry, where high-capacity grinding and kiln drives require durable, high-torque systems, SGL’s gearboxes provide reliable performance, reducing downtime and enhancing operational efficiency.
For the steel and metal industry, SGL offers products that withstand extreme temperatures, shock loads, and constant use. In applications like rolling mills, furnaces, and metal cutting machinery, SGL’s gears deliver precision motion control and high torque, essential for safe, efficient processes.
In the power generation sector, Shanthi Gears’ systems are integral to turbines, auxiliary generators, and other critical equipment. These gear solutions handle high loads, ensuring smooth power transmission across coal, hydro, and renewable energy plants, thus supporting uninterrupted energy production.
The mining and material handling industries require heavy-duty gears capable of withstanding high impact loads and harsh conditions. SGL’s rugged transmission products power machinery such as conveyors, crushers, and loaders, essential for efficient extraction and processing in these demanding environments. The textile industry benefits from SGL’s precise, low-noise gears used in looms, spindles, and other machinery. These components enhance speed control and operational efficiency, critical for continuous and accurate textile processing. For sugar and food processing sectors, SGL supplies moisture-resistant and corrosion-proof gear systems that ensure smooth operations in harsh environments, particularly in conveyor systems and other processing equipment essential to production.
In defense and aerospace, Shanthi Gears delivers custom-engineered, high-strength gear solutions designed to meet stringent standards. Precision gears for aircraft applications and robust gear systems for defense vehicles demonstrate the company’s capability in these high-stakes sectors. Finally, for infrastructure and construction, SGL provides powerful, durable gear systems for cranes, hoists, and heavy machinery, enabling safe and efficient operations crucial for large-scale projects. Across all these sectors, Shanthi Gears’ commitment to innovation and quality assurance reinforces its position as a leader in India’s industrial gear market, meeting the evolving needs of its clients with reliability and precision.
Financials
Shanthi Gears Ltd reported a 22% increase in net profit for the Q2FY25, reaching Rs 26 crore compared to the same period last year. Revenue from operations for the period grew by 15% to Rs 155 crore. For the six-month period, net profit rose to Rs 47 crore from Rs 39 crore, while revenue from operations increased to Rs 294 crore from Rs 257 crore. SGL is a debt free company, and the company has an unexecuted order book of Rs 317 crore as of September, 2024.
Outlook
India’s favorable business environment, bolstered by government initiatives like “Make in India” and PM Gati Shakti, is furthering a robust growth ecosystem for the industrial gear segment. Various government policies promoting local manufacturing and infrastructure development have attracted significant domestic and foreign investments, strengthening India’s position as a global hub for manufacturing, which also supports for the industrial gear industry. As SGL is the leading player in India’s gear manufacturing sector, is well-positioned to leverage these opportunities to expand its reach and capitalize on the sector’s upward momentum.
The shift toward electric vehicles (EVs) represents a transformative avenue for gear manufacturers. With the government’s push for electric mobility, gear makers are presented with new opportunities to develop specialized gears for EV transmissions and powertrains, a market expected to see accelerated demand in the coming years. SGL’s technical expertise and innovation-centric approach make it uniquely qualified to seize these emerging opportunities in EV gear manufacturing.
In addition to the above, the development of India’s rail infrastructure presents a significant growth avenue. Indian Railways’ ambitious plans to introduce 400 Vande Bharat trains, along with high-power passenger and goods locomotives, will boost demand for high-quality gear solutions. These projects, alongside the construction of economic railway corridors, are set to drive logistics efficiency and reduce transportation costs, benefiting industries such as cement, steel, and mining—all key sectors for SGL’s products.
India’s cement industry outlook also points to a growth trajectory supported by rising construction activities. As the country aims to expand cement production and capitalize on port-based facilities for export, gear demand in this sector will increase to support heavy machinery used in production and logistics. SGL’s strong market position in industrial and specialized gear solutions places it favorably to meet the demands of the cement sector as it grows. In short, Shanthi Gears Limited is well-aligned with India’s growth trajectory in manufacturing, infrastructure, and electric mobility. With a strong foundation in precision engineering, customer-focused innovation, and a reputation for quality, SGL is positioned to lead the gear industry forward, capturing emerging opportunities in both domestic and international markets.
Risk Factors
Demand for industrial gears is closely linked to the performance of sectors such as manufacturing, construction, and heavy machinery. Economic downturns or slowdowns in these industries can reduce demand, affecting revenue and profitability. The industry relies heavily on special steel, which largely depends on imports, making it vulnerable to fluctuations in raw material prices. Rising costs can squeeze margins, especially if companies cannot pass these increases on to customers.
Sector: Capital Goods
Market Price: Rs. 530.00 as on today
FV: Rs 1/-
Stock Name: Shanthi Gears Ltd
BSE Code: 522034, NSE Code: SHANTIGEAR
Market Cap.: Rs 4133 Cr
Book Value: Rs. 49.7
Segment: Industrial Products/ Engineering
Incorporation: 1969
Headquarters: Coimbatore, Tamil Nadu
