Feb 16, 2017 05:13 PM IST | Source: Moneycontrol.com

Hold Motherson Sumi; target of Rs 370: ICICI Direct

ICICI Direct recommended hold rating on Motherson Sumi with a target price of Rs 370 in its research report dated February 14, 2017.

Hold Motherson Sumi; target of Rs 370: ICICI Direct

ICICI Direct's research report on Motherson Sumi

MSL’s European subsidiaries (SMR + SMP) posted a strong operating performance. EBITDA margins of SMR improved from >5% in FY12 to 10.5% in FY16 while SMP’s margins improved from 2% in FY12 to 6.6% in FY16. We continue to believe that margin expansion on a YoY basis is likely to continue for its subsidiaries.

Outlook

MSL’s competence in turning around businesses is evident from the success of SMR & SMP. The management’s strong focus on RoCE augurs well for its performance. We remain positive on the long term perspective. We value MSL on an SOTP basis with a target price of Rs 370 & maintain HOLD rating on the stock.

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