Motherson Sumi Wiring Q1 Results Review - Profitability, Revenue Below Expectations: ICICI Securities

ICICI Securities Report

Motherson Sumi Wiring India Ltd.’s Q1 FY25 Ebitdam came in at 10.9%, down 210 basis points QoQ and lower than consensus estimate of 11.4%. Miss in margin was mainly due to higher staff cost and other expenses related to two new facilities.

Motherson Wiring saw strong revenue growth of 18% YoY, versus single digit volume growth environment, although revenue missed consensus estimate of Rs 22.7 billion. We have cut our FY26E earnings by 8% due to-

1. lower than expected revenue growth in Q1,

2. muted passenger vehicle industry performance in recent months and

3. lower-than-expected margins in Q1.

We are building in ~13% revenue compound annual growth rate and ~12.7% average Ebitdam, resulting in earnings CAGR of ~19% over FY24–26E. Maintain Add with DCF-based unchanged target price of Rs 74, implying 36 times FY26E earnings.

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