Auto component makers NRB Bearings, Sansera Engineering, and Craftsman Automation are diversifying into aerospace and defence to boost margins. This shift aims to reduce reliance on the cyclical automotive market and tap into higher-value sectors. Investors are now evaluating whether this growth strategy can sustain premium valuations.
What Happened
Three prominent Indian auto component manufacturers—NRB Bearings, Sansera Engineering, and Craftsman Automation—are actively moving into aerospace, defence, and industrial sectors. This transition involves leveraging their existing precision engineering expertise to move beyond the traditional automotive supply chain. By entering these high-barrier industries, these companies aim to decrease their vulnerability to the cyclical nature of the car industry, which often sees fluctuating demand based on economic conditions.
NRB Bearings' Entry Into Aerospace
NRB Bearings, known for its focus on bearing manufacturing, expanded its portfolio in January 2026 by acquiring Bengaluru-based Mahant Tool Room for ₹27.5 crore. This purchase allows NRB to enter the aerospace engine and fuel system components market immediately, bypassing the multi-year qualification processes usually required for new suppliers. The company secured an existing order book of ₹25 crore through this deal, which has since expanded to ₹50 crore. This move marks a departure from its core automotive focus as it builds a presence in high-precision aerospace components.
Sansera Engineering’s ADS Growth
Sansera Engineering is scaling its presence in the Aerospace, Defence, and Semiconductor (ADS) segment. The company currently operates as a Tier-1 supplier to Boeing and a Tier-2 supplier to Airbus. In FY26, its ADS segment reported a 155% year-on-year growth, reaching ₹315 crore in revenue. Management is actively trying to lower the revenue contribution from internal combustion engine (ICE) vehicles to 60% by FY27, shifting focus toward electric vehicles and non-auto sectors. The company expects the ADS division to generate between ₹550 crore and ₹600 crore in revenue by FY27.
Craftsman Automation and Industrial Focus
Craftsman Automation is focusing on the industrial sector, particularly targeting opportunities in data centers and stationary engines. The company is betting on the long-term growth of India's manufacturing and capital spending cycle. Its aluminum products business is a key growth pillar, with management targeting a revenue milestone of $1 billion within two to three years. To support this growth, the company is prioritizing its balance sheet, with a stated goal of keeping its net debt-to-EBITDA ratio below 2x.
How Investors May Read This
Diversification into aerospace and defence is often viewed positively because these sectors typically offer higher profit margins compared to the high-volume, low-margin nature of the auto parts business. However, these new segments come with their own risks, including long development timelines, strict quality standards, and the need for specialized technical certifications. While Sansera Engineering and Craftsman Automation currently trade at higher valuation multiples compared to their historical averages, NRB Bearings trades closer to sector averages. The key for shareholders will be watching if these companies can successfully maintain their profit margins as they scale these new business lines and manage the capital requirements of such complex projects.