Pune-based Divgi TorqTransfer Systems Ltd is reshaping its growth strategy, moving from individual components to system-level drivetrain solutions, while focusing on exports and selective global expansion. Managing Director Jitendra Divgi says the goal is to build a ₹1,000 crore drivetrain business by 2030, roughly three times the company’s current revenue of around ₹300 crore.
The 2023 IPO was less about immediate capital and more a starting point for a long-term growth journey. Divgi emphasizes the strategic value of systems over standalone parts. “Systems improve EBITDA margins, asset turns, and revenue per employee,” he explains, highlighting revenue per employee as a key measure of business innovation. This focus drives Divgi’s expansion into complete drivetrain systems, including hybrid transmissions, automatic gearboxes, and integrated transfer cases.
Scaling this model requires investment. Over the next three to four years, Divgi plans to spend ₹250 crore, targeting high-growth platforms. Automatic transmissions are a near-term priority, with the company opting for advanced eight-speed systems rather than incremental upgrades. Hybrid transmissions are the second pillar, aligning with industry goals for lower CO₂ solutions while maintaining internal combustion engines.
Exports are central to Divgi’s growth, targeting 30–40% of revenues by 2030. While export contribution dropped in recent years due to geopolitical tensions, COVID-19, and changes in global markets, the company has regained momentum, currently achieving around 20% quarterly export contribution. A key driver has been the exclusive partnership with Toyota Tsusho, providing access to global OEMs and logistics. This collaboration has led to a nomination from a major Japanese OEM to develop a transfer case for a global pickup platform, with production starting in FY28.
While Divgi currently manufactures entirely in India, the company is evaluating a presence in the US to be closer to customers. Any expansion is expected to be greenfield rather than through acquisition, prioritizing control over culture, quality, and operational systems.
Founded in 1964, Divgi TorqTransfer has six decades of expertise in drivetrain technologies, supplying transfer cases, torque couplers, synchronizers, and transmission systems. In India, the company is closely associated with four-wheel and all-wheel-drive systems, serving Mahindra & Mahindra, Tata Motors, and Force Motors. Globally, Divgi works with Tier 1 suppliers such as BorgWarner and Magna across North America, Europe, and Asia.
Beyond automotive, the company’s drivetrain solutions have applications in tractors, construction equipment, defence mobility platforms, rail, and aerospace. While defence is a strategic opportunity, growth is currently focused on automotive due to capacity and market priorities.
FY26 has marked a strong inflection point, with record quarterly income of ₹88 crore and first-half revenue exceeding ₹160 crore—a 39% increase year-on-year. EBITDA rose 35% to ₹41 crore, and profit after tax grew 43% to nearly ₹20 crore, supported by better capacity utilization and cost management. Margins remain strong, with gross margins above 60% and EBITDA exceeding 24%. Exports contributed 16% in H1 and over 20% in Q2. Transfer cases grew 42% year-on-year, driven by Mahindra, Tata, and Force Motors. EV transmission volumes remain modest but are expected to rise as new platforms enter production.
For Divgi TorqTransfer, the focus is clear: scale through systems, expand exports, and grow methodically. The company is moving beyond being a background supplier, aiming to cement its position as a global drivetrain partner.
