Target: ₹118
CMP: ₹95.17
Samvardhana Motherson International (SAMIL) is all set for another year of outperformance on the back of revenue diversification aimed at accelerating incremental growth from high volumes markets like India, Mexico, Japan and China (about 35 per cent of topline); successful integration of recent acquisitions, SOP for consumer electronics and Aerospace ramp up, Japanese supplier network breakthroughs beyond Honda (Yachio + Ichikoh + Atsumitec); and growing contribution from emerging verticals (lightings, aerospace and consumer electronics).
The strategy of 3CX10 achieved on customer while making progress underway on component and country. SAMIL aims to maintain a balanced global footprint with over 50 per cent of revenues from emerging markets achieved in FY25. Further, presence in high-growth areas like India, Mexico, and parts of Asia is deepening, and non-automotive businesses are also gaining traction
The ongoing tariff issue may trigger a near-term slowdown in a few key geographies but the same to be navigated through new programme launches. We build in revenue/EBITDA/PAT CAGR of 10-14 per cent. It currently trades at 25.5x/20.9x FY26E/FY27E consolidated EPS.
We reiterate a Buy with revised TP of ₹118, valuing the company at 24x Mar’27E EPS.