Vijay told CNBC-TV18, "Motherson Sumi is a facility down the road in Noida. They were one of the plethoras of companies born along with Maruti when Maruti actually played an incubator for many of these companies. They make modular parts for the passenger car industry and their main buyer is Maruti."
He further added, "They are a very strong product company and they have also made acquisitions in Hungary and Brazil because the demographics of these two countries are somewhat similar to India, a large small car passenger population etc. The last quarter was not a great quarter for Motherson for one big reason that Maruti production fell very sharply in Manesar and Maruti cut back on supplies. Also the acquisitions they made in Hungary and Brazil, the ramp up was a bit slower than one thought. So the results were okay. The top-line grew at about 20% or so. They also had their forex notionals on account of rupee impairment. But going forward I am seeing a very, very robust growth in Motherson because Maruti has ramped up its capacity, it's working an extra shift and off take from Maruti would be good and also Brazil and Hungary would start contributing to the bottom-line."
"The share has sort of fallen off and is trading at Rs 140 which is a fairly low for that stock on historical basis. I expect that company to have a top line and bottom-line growth of about 50% in the next financial and that's why I am predicting a share price of about Rs 210 for this stock in the next 12 months.
