Why are auto companies chasing smarter cars?

Gabriel India shares slipped nearly 8% after the company announced the acquisition of its promoter’s stake in HL Mando Anand India for ₹2,231 crore. 

Founded in 1997, HL Mando Anand is one of India's largest manufacturers of steering systems, braking systems and suspension components.

Why it matters: through this deal, Gabriel India is making its entry into the fast-growing world of automotive electronics and autonomous driving technologies.

The joint venture plans to develop advanced driver assistance systems (ADAS), along with radar, cameras, lidar and electronic control units for vehicles in India.

The company also reported its Q1 earnings alongside the announcement. Consolidated net profit rose 2% year-on-year to ₹107.4 crore, while revenue climbed 15.5% to ₹1,425.7 crore.

However, profitability was a mixed bag. EBITDA grew 5% to ₹124 crore, but margins slipped to 8.7% from 9.6% a year ago.

Big picture: Gabriel India's move reflects a much bigger shift in the auto industry. As cars become smarter, auto component makers are expanding beyond traditional mechanical parts into electronics, sensors and software.

India's auto component industry is expected to grow 7-8% annually between FY25 and FY30, outpacing the broader automotive market. 

As vehicles become more connected and packed with advanced features, the biggest opportunities are no longer limited to brakes, suspensions and steering systems. They lie in technologies such as ADAS, radar, cameras, lidar and electronic control units, exactly where Gabriel India is now placing its bets.