Motherson Sumi Wiring India a winner of EV shift, target Rs 60: Emkay Global

Emkay Global Financial Services has maintained an 'ADD' rating on Motherson Sumi Wiring India, assigning a target price of Rs 60 on the stock, based on 28 times its estimated FY27 earnings per share (EPS).

Following a visit to the company’s newly commissioned plant in Pune and interactions with its management, Emkay highlighted strong revenue growth and consistent order wins as signs of improving competitive strength. However, the brokerage noted that margin expansion will depend on improved utilisation of new greenfield facilities—progress that is closely linked to the success of electric vehicle (EV) models from key original equipment manufacturer (OEM) clients.

On Thursday, the stock was trading 0.46 per cent higher at Rs 58.60 on BSE. 

“We believe Motherson Sumi Wiring India offers an attractive opportunity in the passenger vehicle (PV) segment, supported by increasing wallet share from new model launches and structural growth in content per vehicle,” the domestic broking firm said.

Emkay Global cited the ongoing premiumisation trend (with SUVs requiring 1.5 times more wiring content than sedans) and the accelerating shift to electrification (with electric PVs needing 1.75 to 2 times more content than their internal combustion engine counterparts) as key tailwinds.

In FY25, Motherson Sumi Wiring India delivered four per cent revenue outperformance compared to its major client Maruti Suzuki India Ltd (MSIL), indicating improved competitiveness. However, Emkay Global emphasised that further margin gains will depend on how efficiently the company ramps up its greenfield plants.

The company currently supplies wiring harnesses to nine of the top ten most popular PV models in India. To support future growth, it is building three new greenfield facilities. The Pune plant is already operational, while the plants in Gujarat and Haryana are scheduled to begin operations in the first half and second quarter of FY26, respectively.

These plants are focused on supporting new EV and ICE programs from major SUV-focused OEMs such as Mahindra & Mahindra Ltd (M&M), Tata Motors Ltd (TTMT), and Maruti Suzuki India Ltd (MSIL), rather than being tied to replacements or mid-cycle model updates.

Once these facilities reach full ramp-up—meaning they achieve the committed production volumes from OEMs—they are expected to contribute approximately Rs 2,100 crore in annual revenue. Motherson Sumi Wiring India anticipates that optimal utilisation of these plants will be achieved by the second half of FY26, which should help ease current margin pressures.

Emkay noted that current losses from greenfield operations stem largely from upfront manpower costs. While the Pune plant is fully staffed, the Gujarat and Haryana sites have seen partial hiring in anticipation of their respective launches. Workforce additions will be phased in, depending on how volumes scale.

Motherson Sumi Wiring India is also committed to increasing localisation of high- and low-voltage harnesses. It has already localised several high-voltage components, such as charging connectors. While import dependence tends to be high at launch, it reduces over time, with localisation yielding approximately 15 to 20 per cent cost savings.

According to Emkay Global, higher localisation and improved manpower productivity will be key drivers of future margin improvement.