Jefferies has reaffirmed its Buy rating on Samvardhana Motherson, while lowering its target price from ₹185 to ₹165, citing a challenging global auto environment but highlighting strong EBITDA margins and diversification efforts.
Key takeaways from Jefferies’ report:
- EBITDA margins exceeded estimates, reflecting operational efficiency and cost management.
- Global auto sector remains uncertain, weighing on near-term growth projections.
- The company is expanding into non-auto sectors, such as electronics and space, to reduce dependency on the auto industry.
- Actively seeking inorganic growth opportunities at attractive valuations, which could boost long-term revenue.
- FY25 EPS estimate cut by 9%, reflecting near-term headwinds but long-term resilience.
Despite a lower target price, Jefferies remains optimistic about Samvardhana Motherson’s growth potential, driven by margin stability, strategic expansion, and acquisition opportunities.
Disclaimer: This article is for informational purposes only and should not be considered financial advice. Investors should conduct their own research before making any investment decisions.
