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SETCO - Setco Automotive

📊 NSE: SETCO 🏢 Auto Ancillaries 📅 Last Updated: 12/14/2025 13:02

📢 Recent Corporate Announcements

Setco Automotive Subsidiary Receives GPCB Closure Order for Kalol Manufacturing Unit

🔴 NEGATIVE ⭐ 8/10

REGULATORY 📅 11 Mar 2026, 10:03 PM

The Gujarat Pollution Control Board (GPCB) has issued a closure direction for the manufacturing unit of Setco Auto Systems Private Limited, a subsidiary of Setco Automotive, located in Kalol, Gujarat. The order, issued under Section 33A of the Water Act, 1974, mandates the disconnection of electricity and the cessation of alleged wastewater discharge near the River Goma. This action follows an inspection conducted on February 13, 2026, and the company is currently evaluating legal remedies to contest the order. While the company is assessing the financial and operational impact, the shutdown of a key facility represents a significant near-term risk to production.

GPCB ordered the closure of the Kalol manufacturing unit belonging to subsidiary Setco Auto Systems Private Limited.
The order includes the disconnection of electricity supply (except single phase) and stoppage of wastewater discharge.
Regulatory action was initiated following an official inspection conducted on February 13, 2026.
The company is exploring legal remedies and assessing the total financial impact of the shutdown.
The unit is located at Baroda–Godhra Highway, Kalol, District Panchmahal, Gujarat.

💡 Investors should exercise caution as the closure of a manufacturing unit can severely disrupt supply chains and revenue. Monitor for updates regarding legal stays or compliance clearances that would allow the facility to resume operations.

Setco Automotive Subsidiary Gets BSE Approval to Extend NCD Maturity to March 31, 2026

🟡 NEUTRAL ⭐ 5/10

REGULATORY 📅 09 Mar 2026, 06:54 PM

Setco Automotive's subsidiary, Setco Auto Systems Private Limited, has received in-principle approval from BSE to modify the terms of its listed Non-Convertible Debentures (NCDs). The modification involves extending the maturity date of these senior, secured NCDs from January 31, 2026, to March 31, 2026. This two-month extension provides the subsidiary with additional time to manage its debt repayment or refinancing obligations. The approval is subject to compliance with SEBI (LODR) and the Companies Act, 2013.

BSE granted in-principle approval on March 9, 2026, for modifying NCD terms of the subsidiary company.
The maturity date for the listed NCDs has been extended from January 31, 2026, to March 31, 2026.
The instruments involved are senior, listed, rated, secured, and non-cumulative debentures.
The extension applies specifically to Setco Auto Systems Private Limited, a key subsidiary of Setco Automotive.

💡 Investors should monitor the company's liquidity position and its ability to meet the revised March 31 deadline. This short-term extension may indicate a need for additional time to finalize refinancing or internal cash flow management.

Setco Automotive Reports Q3 Profit of ₹16 Lakhs Amid Severe SEBI Regulatory Penalties

🔴 NEGATIVE ⭐ 9/10

EARNINGS 📅 13 Feb 2026, 03:10 PM

Setco Automotive reported a standalone net profit of ₹16 Lakhs for Q3 FY26, recovering from a loss of ₹105 Lakhs in the same quarter last year, despite revenue remaining stagnant at ₹24 Lakhs. The results are overshadowed by a SEBI order dated February 5, 2026, which imposes monetary penalties and restricts Executive Directors from the securities market. Most critically, directors have been ordered to repay funds to the company and its subsidiary with a 23% annual interest rate. Auditors have also raised concerns regarding non-accrual of interest on subsidiary loans and significant past investment impairments.

Standalone net profit turned positive at ₹16 Lakhs in Q3 FY26 vs a loss of ₹105 Lakhs in Q3 FY25.
SEBI order imposes market restrictions and penalties on Executive Directors and the former CEO for non-compliance.
Directors directed to repay funds received from the company and subsidiary Setco Auto Systems with 23% p.a. interest.
Revenue from operations remains extremely low at ₹24 Lakhs for the quarter, down from ₹29 Lakhs YoY.
Company carries a significant impairment provision of ₹11,133 Lakhs on total investments of ₹23,385 Lakhs.

💡 Investors should exercise extreme caution as the severe SEBI penalties and the 23% interest repayment mandate against management indicate significant governance and legal risks. The company's minimal operational revenue further weakens the investment case despite the marginal quarterly profit.

Setco Automotive Reports Q3 Profit of ₹16 Lakhs; Faces Severe SEBI Penalties and Market Bans

🔴 NEGATIVE ⭐ 9/10

REGULATORY 📅 13 Feb 2026, 03:06 PM

Setco Automotive reported a standalone net profit of ₹16 Lakhs for Q3 FY26, improving from a loss of ₹105 Lakhs in the same quarter last year. However, the company is embroiled in a major regulatory crisis following a SEBI order on February 5, 2026, which imposes monetary penalties and bars Executive Directors from the securities market. Most significantly, the Managing Director and Whole Time Director have been directed to repay funds received from the company and its subsidiary with a 23% p.a. interest rate. The company is currently in the process of filing an appeal against these orders.

Standalone Net Profit of ₹16 Lakhs in Q3 FY26 vs a loss of ₹105 Lakhs in Q3 FY25.
SEBI Order (Feb 5, 2026) imposes market restrictions and penalties on Executive Directors and the Ex-CEO.
Management directed to repay funds to the company and its subsidiary (SASPL) with 23% p.a. interest.
Revenue from operations remains stagnant at ₹24 Lakhs for the quarter and ₹86 Lakhs for the nine-month period.
Company has provided for impairment in value of investments worth ₹11,133 Lakhs in earlier years.

💡 Investors should exercise extreme caution as the company faces severe regulatory actions and management-level legal challenges. The impact of the SEBI order and the required fund repayments by directors create significant uncertainty despite the marginal quarterly profit.

SEBI Issues Order Against Setco Automotive Over Alleged ₹107.76 Crore Fund Diversion

🔴 NEGATIVE ⭐ 10/10

REGULATORY 📅 06 Feb 2026, 01:47 PM

The Securities and Exchange Board of India (SEBI) has issued a significant order against Setco Automotive Limited (SAL), its subsidiary, and its promoters regarding alleged financial irregularities between FY 2019-20 and FY 2021-22. The investigation highlights a potential diversion of ₹107.76 crore to promoter-controlled entities under the guise of marketing commissions following a slump sale of the core clutch business. The company and its subsidiary had raised ₹615 crore from India Resurgence Fund (IRF) to address a cash crunch, but SEBI alleges these funds were mismanaged. Ten individuals, including the Managing Director and Independent Directors, face potential debarment and monetary penalties for violating PFUTP and LODR regulations.

Alleged diversion of ₹107.76 crore to promoter-linked Setco Engineering Private Limited (SEPL) as marketing commission.
Company raised a total of ₹615 crore from India Resurgence Fund (IRF) through NCDs and equity to manage liquidity.
Core clutch business was transferred to a subsidiary via slump sale for a nominal value of ₹0.05 crore.
SEBI investigation covers potential violations of Fraudulent and Unfair Trade Practices (PFUTP) and Listing Obligations (LODR).
Noticees include MD Harish Sheth, WTD Udit Sheth, and multiple independent directors and KMPs.

💡 Investors should exercise extreme caution as the company faces severe regulatory action and allegations of siphoning funds. The potential debarment of promoters and significant financial penalties pose a high risk to minority shareholders.

Setco Automotive Reports 100% SDD Compliance for Quarter Ended December 31, 2025

🟡 NEUTRAL ⭐ 3/10

REGULATORY 📅 23 Jan 2026, 06:12 PM

Setco Automotive Limited has filed its Structured Digital Database (SDD) compliance certificate for the quarter ended December 31, 2025, as per SEBI Insider Trading regulations. The company confirmed that it has a non-tamperable system in place to track Unpublished Price Sensitive Information (UPSI) with a full audit trail. During the quarter, the company identified 1 specific event that required capturing and successfully recorded that 1 event. This filing confirms there were no non-compliances observed during the period, reflecting standard corporate governance practices.

Achieved 100% compliance by capturing 1 out of 1 required UPSI events during the quarter.
Maintained a non-tamperable internal database with an audit trail capability of 8 years.
Confirmed adherence to Regulation 3(5) and 3(6) of SEBI (Prohibition of Insider Trading) Regulations.
Verified that access controls and timestamping for all disseminated UPSI are functional.

💡 This is a routine regulatory filing indicating the company is following standard insider trading prevention protocols. No specific investment action is required based on this compliance update.

Setco Automotive Submits Quarterly Compliance Certificate for Q3 FY26

🟡 NEUTRAL ⭐ 2/10

ROUTINE 📅 23 Jan 2026, 06:11 PM

Setco Automotive Limited has submitted its quarterly compliance certificate under Regulation 74(5) of SEBI (Depositories and Participants) Regulations, 2018. The document, issued by MUFG Intime India Private Limited, confirms that all dematerialization requests for the quarter ended December 31, 2025, were processed within prescribed timelines. It further verifies that physical share certificates were mutilated and cancelled after due verification. This is a standard administrative filing required for all listed entities in India to ensure the integrity of shareholding records.

Compliance certificate submitted for the quarter ended December 31, 2025.
Confirmation provided by Registrar and Share Transfer Agent, MUFG Intime India Private Limited.
Securities received for dematerialization were processed and listed on stock exchanges.
Physical certificates were mutilated and cancelled as per SEBI guidelines.
The name of the depositories has been updated in the register of members as the registered owner.

💡 No action is required from investors as this is a routine regulatory filing confirming standard administrative compliance.

Setco Subsidiary Receives BSE Approval to Extend NCD Maturity to Jan 31, 2026

🔵 WATCH ⭐ 6/10

REGULATORY 📅 07 Jan 2026, 06:51 PM

Setco Automotive Limited's subsidiary, Setco Auto Systems Private Limited, has received in-principle approval from BSE to modify the terms of its senior, listed, secured Non-Convertible Debentures (NCDs). The key modification is the extension of the maturity date from the previous deadline of December 1, 2025, to a new date of January 31, 2026. This extension suggests a need for additional time to manage debt obligations or complete refinancing. The approval is subject to ongoing compliance with SEBI and Companies Act regulations.

BSE granted In-Principle Approval on January 7, 2026, for modification of NCD terms.
The maturity date for the subsidiary's NCDs is extended from December 1, 2025, to January 31, 2026.
The NCDs involved are senior, listed, rated, secured, and non-cumulative instruments.
Approval is contingent upon compliance with SEBI (LODR) Regulations and the Companies Act, 2013.

💡 Investors should monitor the subsidiary's ability to meet the revised January 31, 2026, deadline and evaluate the group's overall liquidity position. The extension of a past-due maturity date indicates tight cash flow management that warrants caution.

Setco Subsidiary Receives BSE Approval to Extend NCD Maturity to Jan 31, 2026

🔵 WATCH ⭐ 6/10

REGULATORY 📅 07 Jan 2026, 06:16 PM

Setco Automotive's subsidiary, Setco Auto Systems Private Limited, has received in-principle approval from BSE to modify the terms of its senior listed NCDs. The primary modification involves extending the maturity date from the original December 1, 2025, to a new date of January 31, 2026. This extension provides the subsidiary with additional time to manage its redemption obligations. The approval is subject to compliance with SEBI (LODR) Regulations and the Companies Act, 2013.

BSE granted in-principle approval on January 7, 2026, for NCD term modifications.
The maturity date for the subsidiary's NCDs is extended from December 1, 2025, to January 31, 2026.
The instruments are senior, listed, rated, secured, and non-cumulative debentures.
The extension is subject to compliance with SEBI and other applicable regulatory frameworks.

💡 Investors should monitor the subsidiary's liquidity position and its ability to meet the revised January 31 deadline. The extension suggests a potential short-term cash flow mismatch that requires close observation of the company's debt servicing capabilities.

Setco Automotive Announces Trading Window Closure from January 1, 2026

🟡 NEUTRAL ⭐ 2/10

ROUTINE 📅 31 Dec 2025, 03:28 PM

Setco Automotive Limited has announced the closure of its trading window for all designated persons starting January 1, 2026. This closure is in compliance with SEBI (Prohibition of Insider Trading) Regulations, 2015, ahead of the upcoming financial results. The window will remain closed until 48 hours after the declaration of the audited standalone and consolidated financial results for the quarter and nine months ended December 31, 2025. This is a standard regulatory procedure for listed companies in India.

Trading window closure begins effective Thursday, January 1, 2026.
Applies to all directors, designated employees, connected persons, and their immediate relatives.
Closure is related to the financial results for the quarter and nine months ending December 31, 2025.
Trading window will reopen 48 hours after the official declaration of audited financial results.

💡 This is a routine regulatory announcement and does not require any immediate action. Investors should monitor the company's upcoming financial results for actual performance indicators.

Setco Automotive Clarifies Single Segment Operations Following NSE Query

🟡 NEUTRAL ⭐ 3/10

REGULATORY 📅 17 Dec 2025, 11:32 AM

Setco Automotive Limited has provided a clarification to the National Stock Exchange regarding its financial results for the quarter ended June 30, 2025. The exchange had flagged an inadequacy in the filing under SEBI Regulation 33, specifically concerning segment reporting requirements. The company officially stated that it operates in a single business segment, which is Auto Components. This filing resolves the procedural query raised by the exchange to ensure regulatory compliance.

NSE flagged an inadequacy in the financial results for the quarter ended June 30, 2025
Clarification provided under Regulation 33 of SEBI (LODR) Regulations, 2015
Company confirmed it has only one business segment: Auto Components
The response was submitted on November 27, 2025, to the National Stock Exchange

💡 No action is required as this is a procedural clarification regarding segment reporting. Investors should focus on the company's operational performance in the auto component sector rather than this regulatory filing.

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💰 Financial Performance

Revenue Growth by Segment

Consolidated revenue from operations grew 12.2% YoY to INR 718.6 Cr in FY25, up from INR 640.7 Cr. The Aftermarket segment was a primary driver, growing 31% YoY and contributing 15.6% of total revenue. Standalone revenue was minimal at INR 2.73 Cr following the transfer of the clutch business to its subsidiary.

Geographic Revenue Split

International operations are key drivers: North American (SANAI) sales grew 6% YoY with 12% EBITDA margins. European (SAUL) sales grew 2% YoY, though EBITDA remained negative. The company also operates in the Middle East via Setco MEA DMCC.

Profitability Margins

The company reported a consolidated Net Loss of INR 126.33 Cr in FY25, a slight improvement of 4.95% from a loss of INR 132.58 Cr in FY24. Profitability is severely impacted by high finance costs of INR 217.41 Cr, which increased 21% YoY, exceeding the operating profit.

EBITDA Margin

Consolidated EBITDA grew 50.7% YoY to INR 109.2 Cr in FY25, up from INR 72.5 Cr. The EBITDA margin improved to approximately 15.2% from 11.3% in the previous year, driven by higher-margin aftermarket sales and export growth.

Capital Expenditure

Not explicitly disclosed in absolute INR Cr for the current period, but the company is investing in 'State-of-the-Art' manufacturing and R&D capabilities in the UK and India to support new product ranges.

Credit Rating & Borrowing

The company was assigned an [ICRA]D rating in June 2021 due to irregularities in servicing bank debt. While the rating was withdrawn in December 2021 after debt was transferred to the SASPL subsidiary, liquidity remains stretched with consolidated finance costs at INR 217.41 Cr.

⚙️ Operational Drivers

Raw Materials

Specific raw materials include iron castings (sourced from subsidiary Lava Cast), steel, and friction materials for clutch manufacturing. Castings represent a significant portion of the input for the clutch and flywheel lines.

Import Sources

Sourced domestically in India (via Lava Cast Pvt Ltd) and internationally to support manufacturing hubs in the UK and North America.

Key Suppliers

Lava Cast Private Limited (subsidiary) is a primary supplier of castings. Other third-party vendors for steel and friction components are utilized but not named.

Capacity Expansion

Current capacity is not stated in units, but the company is expanding its 'Setco Allied Products' line to include flywheels, bearings, brakes, and lubricants to utilize existing distribution channels.

Raw Material Costs

Not disclosed as a specific percentage of revenue, but the company is implementing proactive cost-reduction steps in its European operations to offset negative EBITDA.

Manufacturing Efficiency

The company utilizes 'State-of-the-Art' facilities and an R&D hub in the UK (SAUL) to improve product life and performance, specifically for the LIPE brand.

Logistics & Distribution

The company uses a global distribution network with hubs in the UK, USA, and Dubai to serve the European, North American, and Middle Eastern markets.

📈 Strategic Growth

Expected Growth Rate

7-9%

Growth Strategy

The company is transitioning to an aftermarket-focused enterprise to reduce OEM dependency. Strategy includes launching 'Setco Allied Products' (bearings, brakes, lubricants), expanding the LIPE brand in Europe, and developing a new range of clutches for the North American market to augment existing business.

Products & Services

Clutches for M&HCV and LCV, flywheels, bearings, brakes, lubricants, and oil.

Brand Portfolio

LIPE, Setco, Setco Allied Products.

New Products/Services

Launched 'Setco Allied Products' including flywheels, bearings, brakes, and lubricants to complement the core clutch portfolio.

Market Expansion

Targeting the North American market with a new range of clutches and the European market through new distributor setups under the SAUL subsidiary.

Strategic Alliances

Maintains six global subsidiaries including Setco Auto Systems Pvt Ltd (SASPL) and Lava Cast Pvt Ltd.

🌍 External Factors

Industry Trends

The industry is shifting toward organized spare parts and preventive maintenance. Vehicle parc expansion and the increasing average age of vehicles are driving a 31% growth in the company's aftermarket segment.

Competitive Landscape

Competes with global and domestic clutch manufacturers in the OEM and IAM segments.

Competitive Moat

Moat is built on 40+ years of excellence, the established 'LIPE' brand, and a dominant position in the Indian M&HCV clutch market. Sustainability is supported by a shift to the less cyclical aftermarket.

Macro Economic Sensitivity

Highly sensitive to infrastructure spending and GDP growth, which drive M&HCV demand. The Indian auto component industry's 7-9% growth forecast for FY26 is a key benchmark.

Consumer Behavior

Shift toward higher-quality, branded spare parts in the organized aftermarket to ensure vehicle uptime in the commercial sector.

Geopolitical Risks

Exposure to trade barriers and economic uncertainty in European and North American markets where subsidiaries operate.

⚖️ Regulatory & Governance

Industry Regulations

Complies with the Companies Act 2013 and SEBI Listing Regulations. Operations are subject to automotive safety and manufacturing standards in India, the UK, and the USA.

Taxation Policy Impact

Consolidated tax provision was a credit of INR 2.85 Cr in FY25 compared to a credit of INR 6.23 Cr in FY24.

Legal Contingencies

The company has extended the redemption date for NCDs worth INR 574.50 Cr multiple times, with the latest extension to December 1, 2025, following agreements with debenture holders and trustees.

⚠️ Risk Analysis

Key Uncertainties

Liquidity risk is the primary uncertainty, evidenced by the [ICRA]D rating and the need to extend NCD redemptions. Potential impact is a 100% disruption of credit facilities if defaults occur.