Samvardhana Motherson International Ltd. share price target

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...

Swift resumption of production in China is an encouraging development. Relatively quick recovery of plants in Europe, India and the Americas would be key for MSSL given importance of healthy capacity utilisation amid relatively large outgo on employee costs, interest and depreciation. We...

total 27. Whereas other key markets like US, South America and UK hasn't seen any shutdowns so-far. We believe, significant correction presents an opportunity to buy this stock at an attractive valuation at 11x FY21 estimates. We upgrade the stock to BUY (from Accumulate) with lowered fair value to Rs115 (from Rs153) led by earning cuts and lower 16x multiple (from 18x) to...

US operations continue to be normal so far. For PKC, all the facilities are running normally, although demand could decline. American operations are normal, whereas EU plants are running as usual but shutdowns are being announced. with all plants except one back to normal level of operations. While these shutdowns can hurt near-term volumes, management indicated that OEMs may make up for the current loss by reducing normal shutdowns of August (holiday season). From its suppliers' perspective, most of its key suppliers are large corporates like Sumitomo, BASF and Reliance Industries. Thus, smaller suppliers, it has visibility of alternative suppliers. The group is facing no credit squeeze from any financiers and has enough liquidity available in all operating entities. For the debt at the holdco level (SAMIL), for which there is pledge of MSS shares, management indicated that it can pay down the entire debt today (if need be) as it has sufficient cash.

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...

Motherson Sumi Systems Ltd (MSSL) topline witnessed decline of 5% yoy to INR 15661 cr in Q3FY20.

Motherson Sumi Systems (MSSL) reported a muted Q3FY20 performance. Total consolidated revenues in Q3FY20 were at | 15,661 crore, down 8.8% YoY. EBITDA in Q3FY20 was at | 1,236 crore with corresponding EBITDA margins at 7.9%, down 40 bps QoQ. Resultant consolidated PAT (post minority interest) in Q3FY20 came in at | 271 core, down 34% YoY. On a standalone basis, revenues declined 11.3% YoY to | 1643 crore with EBITDA margins at 17.0% (up 190 bps QoQ). Even on the subsidiaries front, the performance was weak with SMR reporting revenue of 378 million (down...

10 February 2020 MSS third-quarter performance was weak across businesses due to revenue weakness-led operating deleverage. Continued reduction in losses of SMPs greenfield plant was the only positive. EPS by 10.5%/9% to factor in near-term volume weakness across key businesses. Maintain as we see scope of twin benefit of a cyclical recovery and a sharp turnaround at the new plant. revenue/EBITDA/PAT declined ~5%/11%/23% YoY to INR156.6b/INR12.4b/INR3b. revenue increased 4% YoY, but EBITDA/PAT were down 7%/16% YoY. Standalone revenue declined 5% YoY led by copper price decline (-5% YoY) and weak PV industry (-8%). EBITDA margin was flat YoY/QoQ at 15% (est.

As far as first de-merging (domestic wiring harness) exercise is concerned, we view this as neutral from a minority shareholder's perspective as it will mirror the present shareholding of MSSL and is being largely done at the behest of its long standing technology partner i.e. Sumitomo Wiring Systems, Japan (SWS). The India wiring harness division is constituted under the MSSL standalone operations with contribution to standalone top line at 72% while contribution to consolidated topline is 8.4%. Pure play India operations, excluding exports (~| 4647 crore as of FY19), constitute...

31 January 2020 Automobiles The Board of Directors of MSS have granted an in-principle approval for re- organization of businesses within the group, which includes Demerger of the India wiring harness business into a new company having mirror shareholding as MSS and shall be listed, Consolidation of shareholding in SMRPBV by merging ~49% stake held by Samvardhana Motherson International Ltd (SAMIL) in SMRPBV into MSS. Effectively, the current listed entity (MSS-2) will be left with the global businesses (100% of SMRPBV and PKC) and the remaining India businesses including JVs. The India wiring harness business (MSS-1) will be focused on the domestic India business, as desired by Sumitomo (Refer Exhibit 1 & 6). MSSL-2 will be the global businesses + other India businesses/JVs including the wiring harness JV supplying to Hyundai. SAMIL can look at JVs. Also, MSSL-2 would not have any restriction on acquiring any car wiring harness business outside India (which was restricted so far by Sumitomo).