Samvardhana Motherson: Why did Nuvama cut its target price on SAMIL?
Nuvama also noted SAMIL's successful acquisitions and partnerships, such as those with Irillic, Cirma, and BIEL, which have bolstered growth.
- Aug 14, 2025,
- Updated Aug 14, 2025 8:37 AM IST
Nuvama has revised its target price for Samvardhana Motherson International Ltd (SAMIL) to Rs 110 by September 2027, down from a previous Rs 117 for March 2027. This adjustment reflects the slower-than-expected margin ramp-up in recent acquisitions and greenfield plants.
SAMIL's first-quarter revenue for FY26 reached Rs 30,210 crore, marking a 5 per cent year-on-year increase, aligning with market expectations. However, EBITDA fell 11 per cent to Rs 2,460 crore, missing predictions by 5 per cent due to temporary issues such as delayed launches in Europe and integration adjustments for new acquisitions.
Nuvama remains optimistic about SAMIL, citing its strong management and strategic initiatives. Despite cutting estimated EBITDA for FY26E and FY27E by 4 per cent and 5 per cent respectively, Nuvama continues its 'BUY' rating, pointing to a projected revenue CAGR of 6 per cent and earnings CAGR of 11 per cent over FY25–28E. "We reckon a revenue CAGR of 6 per cent over FY25–28E, supported by pending orders, higher content and inorganic initiatives. The order book is large with booked business at USD88.1bn in Mar-25. Content per vehicle is likely to rise on premiumisation and electrification in both domestic and overseas markets," Nuvama stated.
The brokerage highlights SAMIL's diversification into emerging segments, particularly in the auto and non-auto sectors, as a key driver of future growth. Vision FY30 targets USD108bn in gross revenue by FY30E, aiming for a 33 per cent CAGR.
Nuvama also noted SAMIL's successful acquisitions and partnerships, such as those with Irillic, Cirma, and BIEL, which have bolstered growth. "Going forward, acquisition of Atsumitec and capacity addition across lighting & electronics, precision metals, consumer electronics and aerospace are likely to accelerate growth further. We reckon an emerging business revenue CAGR of 23 per cent over FY25–28E," Nuvama said. The company's continued focus on premiumisation and electrification, both domestically and internationally, are expected to enhance content per vehicle, driving long-term value. Analysts believe that while the current challenges pose short-term hurdles, SAMIL's strategic initiatives and robust management may support its growth trajectory. The market will closely watch SAMIL’s performance in the upcoming quarters to gauge recovery and expansion progress. SAMIL's efforts to explore inorganic opportunities and expand its presence in aerospace and consumer electronics are also anticipated to play a pivotal role in achieving its future targets.
Nuvama has revised its target price for Samvardhana Motherson International Ltd (SAMIL) to Rs 110 by September 2027, down from a previous Rs 117 for March 2027. This adjustment reflects the slower-than-expected margin ramp-up in recent acquisitions and greenfield plants.
SAMIL's first-quarter revenue for FY26 reached Rs 30,210 crore, marking a 5 per cent year-on-year increase, aligning with market expectations. However, EBITDA fell 11 per cent to Rs 2,460 crore, missing predictions by 5 per cent due to temporary issues such as delayed launches in Europe and integration adjustments for new acquisitions.
Nuvama remains optimistic about SAMIL, citing its strong management and strategic initiatives. Despite cutting estimated EBITDA for FY26E and FY27E by 4 per cent and 5 per cent respectively, Nuvama continues its 'BUY' rating, pointing to a projected revenue CAGR of 6 per cent and earnings CAGR of 11 per cent over FY25–28E. "We reckon a revenue CAGR of 6 per cent over FY25–28E, supported by pending orders, higher content and inorganic initiatives. The order book is large with booked business at USD88.1bn in Mar-25. Content per vehicle is likely to rise on premiumisation and electrification in both domestic and overseas markets," Nuvama stated.
The brokerage highlights SAMIL's diversification into emerging segments, particularly in the auto and non-auto sectors, as a key driver of future growth. Vision FY30 targets USD108bn in gross revenue by FY30E, aiming for a 33 per cent CAGR.
Nuvama also noted SAMIL's successful acquisitions and partnerships, such as those with Irillic, Cirma, and BIEL, which have bolstered growth. "Going forward, acquisition of Atsumitec and capacity addition across lighting & electronics, precision metals, consumer electronics and aerospace are likely to accelerate growth further. We reckon an emerging business revenue CAGR of 23 per cent over FY25–28E," Nuvama said. The company's continued focus on premiumisation and electrification, both domestically and internationally, are expected to enhance content per vehicle, driving long-term value. Analysts believe that while the current challenges pose short-term hurdles, SAMIL's strategic initiatives and robust management may support its growth trajectory. The market will closely watch SAMIL’s performance in the upcoming quarters to gauge recovery and expansion progress. SAMIL's efforts to explore inorganic opportunities and expand its presence in aerospace and consumer electronics are also anticipated to play a pivotal role in achieving its future targets.