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Demand led to an improvement in top line but cost inflation impacted operating profitability.
Motherson Sumi Systems was also hit by the shortage of semiconductor chips and soaring raw material prices. However, the soft patch provides a good opportunity to accumulate
Net Sales are expected to decrease by 6.5 percent Y-o-Y (down 13 percent Q-o-Q) to Rs 14,661.2 crore, according to Motilal Oswal.
Net Sales are expected to decrease by 8.1 percent Y-o-Y (down 14.5 percent Q-o-Q) to Rs 14,510 crore, according to ICICI Direct.
At the current market price, MSSL’s valuation is at a discount to its long-term average. We advise investors to accumulate the stock on dips
Most business segments of Motherson Sumi, India's largest automotive wiring harness player, saw a significant revenue growth. The operating margin too jumped
BS-VI emission norms and the EV play provide a good opportunity for growth in revenues and a gradual increase in margins
What continues to work in favour of Motherson Sumi Systems is its strong order book
Motherson Sumi, a market leader with strong relationship with original equipment manufacturers (OEMs), is expected to ride on the recovery of demand for cars
Demand may improve from April 1, 2020 once the transition from BS IV to BS VI is complete. The management stated that the second hand car demand has reached its peak which suggests the demand will improve for new cars in domestic market
Morgan Stanley has maintained overweight rating, but cut price target Rs 149 (from Rs 157 earlier), saying Motherson should see strong earnings growth driven by BS-VI transition
Net Sales are expected to increase by 12.3 percent Y-o-Y (down 3.4 percent Q-o-Q) to Rs. 16,589 crore, according to Kotak.
Net Sales are expected to increase by 8 percent Y-o-Y (down 7 percent Q-o-Q) to Rs. 15,961.7 crore, according to Prabhudas Lilladher.
Macquarie maintains outperform call on the stock with a target price at Rs 185 apiece
Net Sales are expected to increase by 10.6 percent Y-o-Y (up 3.4 percent Q-o-Q) to Rs. 17,037 crore, according to Prabhudas Lilladher.
Net Sales are expected to increase by 15 percent Y-o-Y (up 9.6 percent Q-o-Q) to Rs. 16,554.9 crore, according to Chola Securities.
Net Sales are expected to increase by 17.3 percent Y-o-Y (up 11.7 percent Q-o-Q) to Rs. 16,878.7 crore, according to Motilal Oswal.
Challenges relating to tight liquidity and low buying sentiment continue to weigh on sales growth.
The new plants are getting commissioned that should result in increasing revenues and operating leverage. This, coupled with the push towards EV (Electric Vehicles) should result in healthy growth in the topline and gradual increase in margins. MSSL is currently trading at reasonable valuations, which warrants investors’ attention.