172@29@17@101!~!172@29@0@53!~!|news|business|stocks|hold-motherson-sumi-target-of-rs-120-icici-direct-5956831.html!~!news|moneycontrol|com!~!|controller|infinite_scroll_article.php!~!is_mobile=false
Moneycontrol
Subscribe to Moneycontrol Pro and get 365 bonus InterMiles! Use Code: INTERMILES
Last Updated : Oct 13, 2020 11:50 AM IST | Source: Moneycontrol.com

Hold Motherson Sumi; target of Rs 120: ICICI Direct

ICICI Direct recommended hold rating on Motherson Sumi with a target price of Rs 120 in its research report dated October 12, 2020.

Broker Research
 
 
live
  • bselive
  • nselive
Volume
Todays L/H
More

ICICI Direct's research report on Motherson Sumi


We attended Motherson Sumi’s (MSSL) virtual investor conference about the top businesses in the promoter entity, Samvardhana Motherson International (SAMIL). The meet was informative with all business heads explaining their respective businesses in detail, the margin and RoCE profile that they operate in, the customer segment that they cater to, growth opportunities that lie ahead and also shared their journey towards attaining the group target of 40% RoCE in their respective businesses in due course of time. We were particularly enthused by SAMIL’s lighting business (ahead of industry in terms of share of revenues in the LED segment) as well as other businesses that are likely to gain traction due to constant up-gradation in safety norms worldwide. As part of MSSL’s corporate restructuring exercise, MSSL would be merging SAMIL into itself by acquiring the latter’s other lines of business in auto ancillary and other support functions. This would consolidate all the group’s automotive businesses in the present listed entity (ex-domestic wiring harness division, which would be listed separately on exchanges).


Outlook


We value MSSL at Rs 120 i.e. 22x P/E on FY22E EPS of Rs 5.4 and retain our HOLD rating on the stock. For simplicity we have retained MSSL numbers (ex-corporate restructuring) and P/E valuation methodology which depicts the same target price as our SOTP based fair value calculation exercise incorporating restructuring (Exhibit 14).


For all recommendations report, click here


Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

First Published on Oct 13, 2020 11:50 am
Sections