Buy Samvardhana Motherson International, target price Rs 170: JM Financial

JM Financial has buy call on Samvardhana Motherson International Ltd. with a target price of Rs 170. The current market price of Samvardhana Motherson International Ltd. is Rs 152.4 Time period given by analyst is year when Samvardhana Motherson International Ltd. price can reach defined target. Samvardhana Motherson International Ltd., incorporated in the year 1986, is a Large Cap company (having a market cap of Rs 107739.75 crore) operating in Auto Ancillaries sector.

Samvardhana Motherson International key products/ revenue Segments include Auto Electricals, Sale of services, Traded Goods, Other Operating Revenue, Scrap, Export Incentives and Job Work for the year ending 31-Mar-2024.



Financials
For the quarter ended 31-03-2025, the company has reported a Consolidated Total Income of Rs 29433.22 crore, up 5.96% from last quarter Total Income of Rs 27777.12 crore and up 8.44 % from last year same quarter Total Income of Rs 27141.81 crore. The company has reported net profit after tax of Rs 983.33 crore in latest quarter.

The company's top management includes Mr.Vivek Chaand Sehgal, Mr.Pankaj Mital, Mr.Laksh Vaaman Sehgal, Mr. Robert Joseph Remenar, Ms.Rekha Sethi, Mr.Naveen Ganzu, Mr.Velli Matti Ruotsala. The company has S R Batliboi & Co. LLP as its auditors. As on 31-03-2025, the company has a total of 704 crore shares outstanding.

Investment Rationale
In 4QFY25, Samvardhana Motherson International reported consol. EBITDA margin of 9% (-180bps YoY), 110bps below JM Financial estimates. Margin during the quarter was impacted by challenges related to product launches (one-off) and EU production realignment in the module and polymer business. However, the company expects it to improve going ahead. Despite weak global demand for light vehicles remains, SAMIL continues to outperform led by higher content per vehicle owing to premiumisation and hybridisation. While the company remains silent on its EMS business, JM Financial expects it to contribute substantially to the revenue from FY27 onwards. Overall, the brokerage believes the company with its global presence, wide customer base and an expanding product portfolio, especially with respect to opportunity in Consumer Electronic and Aerospace, presents a multi-year growth opportunity. They expect revenue / EPS CAGR of 10% / 30% over FY25-27E. JM Financial maintains BUY rating with Mar?27 TP of Rs 170 (19x FY27e EPS). Recovery in global LV demand remains a key monitorable.

Promoter/FII Holdings
Promoters held 58.13 per cent stake in the company as of 31-Mar-2025, while FIIs owned 12.42 per cent, DIIs 20.95 per cent.