Broking house, P-Sec is bullish on Motherson Sumi and has recommended buy rating on the stock.
P-Sec report on Motherson Sumi:
As a part of its strategy to diversify in newer products, the company has entered into 49:51 JV with Japanese player Calsonic Kansei to make automotive air - conditioners. The two companies would invest 100 million rupees together in the first phase, with Motherson holding 49 percent in the venture and Calsonic the rest. The production would start in 2009 and have revenue of about 500 million rupees in the year to March 2010. Motherson Sumi reported topline growth of 32% y-o-y on back of robust domestic and exports volumes. EBIDTA margins improved by 26bps y-o-y due to forex gains of Rs.134 million against a forex loss of Rs.81 million last year resulting in bottomline growth of 63% y-o-y. The stock trades at 13.4 x its FY09P earnings; we recommend Buy.
