Buy Motherson Sumi Wiring India; target of Rs 105: ICICI Direct

The research firm ICICI Securities believes earnings of apparel brands and retail companies under their coverage may surprise positively from Q3FY22E as the likely demand recovery may result in better than expected margin performance. Some of the costs savings achieved during pandemic may sustain and coupled with high operating leverage may lead to higher than pre-covid margins from Q3FY22E.  Stocks like Trent, V-Mart and Aditya Birla Fashion and Retail are the preferred picks backed by their strong and consistent track record of execution.

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ICICI Direct's research report on Motherson Sumi Wiring India

Motherson Sumi Wiring India (MSWIL) was established in 1986 as a JV with Sumitomo Wiring Systems (Japan). MSWIL is a leading, full-system wiring harness solutions provider in India catering to all major OEMs like Maruti Suzuki, Toyota Motors, Ashok Leyland, Tata Motors, etc. Listed on March 28, 2022. FY22 segment mix: PV: 60%; CV: 11%; 2-W: 12%; Others: 17% • It has 23 plants in India with 40,000+ employees. It was recently carved out of the erstwhile Motherson Sumi (MSSL) at the behest of its JV partner.

Outlook

We bring MSWIL in coverage pursuant to de-merger and assign BUY rating amid structural levers for long term secular growth & ~50% RoCE profile. Introducing FY25E, we value MSWIL at Rs 105 i.e. 42x P/E on average FY24-25E EPS of Rs 2.5.

More Info

At 16:01 hrs Motherson Sumi Wiring India was quoting at Rs 87.00, up Rs 2.25, or 2.65 percent.

It has touched an intraday high of Rs 88.40 and an intraday low of Rs 84.80.

It was trading with volumes of 454,158 shares, compared to its thirty day average of 685,864 shares, a decrease of -33.78 percent.

In the previous trading session, the share closed up 0.59 percent or Rs 0.50 at Rs 84.75.

The share touched its 52-week high Rs 94.05 and 52-week low Rs 10.00 on 09 September, 2022 and 24 March, 2022, respectively.

Currently, it is trading 7.5 percent below its 52-week high and 770 percent above its 52-week low.

Market capitalisation stands at Rs 27,474.03 crore.

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Motherson Sumi Wiring India - 290922 - icici