SAMIL, Sona BLW, Bharat Forge among auto component stocks in focus today; here's why 

Auto component makers such as Samvardhana Motherson International Ltd (SAMIL), Sona BLW Precision Forgings Ltd (Sona Comstar) and Bharat Forge, with a significant exposure to the US market, are in focus on Tuesday morning amid reports of a likely ease in planned Trump tariffs on auto components. Trump had said earlier he planned to impose tariffs of 25 per cent on auto parts no later than May 3.

A Reuters report today indicated that the Trump administration is looking to lessen the impact of its automotive tariffs. According to officials, the administration may ease some of the duties on foreign auto parts used in vehicles manufactured in the US, while avoiding layering additional tariffs on fully imported cars.

In FY24, Bharat Forge's 25 per cent consolidated revenue and 35 per cent standalone revenue (28 per cent/37 per cent in 9MFY25); Sona Comstar's 40 per cent revenue (43 per cent in 9MFY25) and Motherson Sumi's 18 per cent revenue came from the US. 

In an earlier note, Nomura suggested that SAMIL already has a manufacturing facility in the US (in Alabama, Michigan and Houston), which could help ramp up production to reduce tariff exposure, thereby lowering the impact. Balkrishna Industries’ 18 per cent of the FY24 revenue (16 per cent in 9MFY25) came from the US, it noted. 

Sona Comstar (Sona BLW) derives 43 per cent of its revenue from the US and Bharat Forge 38 per cent, with products being made largely in India and not in the US, CLSA noted earlier.

Commerce Secretary Howard Lutnick stated from the White House: "President Trump is building a vital partnership with domestic automakers and hardworking American employees."

Lutnick, Reuters reported him as saying, added that the agreement represents a significant win for the President's trade policy, rewarding companies that manufacture in the US and offering flexibility to those planning future investments in American production.

The Trump administration recently halted reciprocal tariffs imposed on most trading partners for 90 days -- except for China. Analysts are expecting only a minimal likelihood of the stringent April 2 tariff proposals being implemented now. Analysts said the economic and financial disruptions already experienced serve as a limiting factor for aggressive US trade policies. Emkay expects a surge in bilateral trade agreements in coming months and eventually resulting in a tariff framework only slightly more protectionist than the previous regime.