Samvardhana Motherson International Ltd. share price target

Background: Motherson Sumi Systems Limited (MSSL) is one of the world's leading, specialized automotive component manufacturing companies for OEMs. MSSL was established in 1986 as a joint venture with Sumitomo Wiring Systems. MSSL is a focused, dynamic and progressive company providing customers with innovative and value-added products, services and solutions. With a diverse global customer base of nearly all leading automobile manufacturers globally, the company has a presence in 36 countries across six continents. MSSL is currently the largest auto ancillary in India and among...

Strong order book in SMRPBV, recovery in India PV/US CV improves visibility MSS' 4QFY21 performance was a beat led by strong performance in India and SMP, as well as lower tax. MSS would continue to benefit from a cyclical recovery in its key businesses as well as from a strong order book and improving efficiencies in SMRPBV. We upgrade our FY22E/FY23E EPS by 16%/20%, factoring in a strong recovery in SMP, India, and PKC, as well as a lower tax rate. We maintain...

MSS 4QFY21 results were operationally in-line as EBITDA grew 24% YoY to Rs17.2b (PLe Rs17.7b) with margins at 10.1% (+90bp YoY, PLe 10.7%) led by continued healthy performance in key global businesses. SMRP BV's healthy order book at Eur15.6b (with Eur4.5b new orders won in 2HFY21) will drive healthy revenues over FY22-24. Sound working capital management and controlled capex led consol net debt to decline by Rs48b in FY21 (v/s Rs69b in FY20). We expect deleveraging to continue for organic business as strong...

MSSL said: (1) Its order-book (lifetime sales of awarded programs) at SMRPBV as of March 2021 were at 15.6 billion (gained 4.5 billion worth new orders in H2FY21) with share of EVs at ~25%. It will be supplying near similar products to electric vehicles. The content, however, marks a sharp increase amid focus on light-weighing, efficiency & premiumisation; (2) it is less impacted due to global semi-conductor chip shortage; (3) business prospects at PKC are healthy but during the quarter there was some pressure on margins due to rise in copper prices amid increased copper...

Ready for the next leap

Background: Motherson Sumi Systems Limited (MSSL) is one of the world's leading, specialized automotive component manufacturing companies for OEMs. MSSL was established in 1986 as a joint venture with Sumitomo Wiring Systems. MSSL is a focused, dynamic and progressive company providing customers with innovative and value-added products, services and solutions. With a diverse global customer base of nearly all leading automobile manufacturers globally, the company has a presence in 36 countries across six continents. MSSL is currently the largest aut o ancillary in India and among...

Motherson Sumi Systems Ltd (MSSL) is a JV between Samvardhana Motherson International (SMIL) and Sumitomo Wiring Systems, Japan (SWS). MSSL is a diversified auto parts maker with presence in automotive...

We build ~81% PAT CAGR for MSSL in FY21E-23E (albeit on low base). We note the smart upswing in SMP greenfield performance and remain excited about the company's larger picture focus on (i) increased content per car & (ii) profitable growth. However, with large part of vision 2025 at MSSL involving big ticket acquisition that has an element of uncertainty, we retain...

Motherson Sumi Systems (MSS) reported robust Q3FY21 operational performance with 260bps YoY improvement in EBITDA margin to 10.8%

MSS 3QFY21 results were better with sharp beat at EBITDA/PBT by 14%/42%. led by sustained improvement in SMP's greenfield plants and continued cost reduction in all global business. EBITDA grew 61% YoY to Rs17.9b (PLe Rs15.7b) with 14 quarter high margins at 10.5% (+310bp YoY, PLe 9.6%). Execution of a strong order book and limited capex at SMPBV as well as India...