Samvardhana Motherson Q2 Results: Stock surges after Profit fall better than feared; margin expands

Shares of Samvardhana Motherson International Ltd. have recovered from the lows of the day and ended with gains of nearly 6% on Thursday, November 13, in response to their September quarter results.The company reported a net profit of ₹827 crore during the September quarter, 6% below the previous year’s bottomline figure of ₹880 crore. A CNBC-TV18 poll of analysts expect the company’s net profit for the quarter to drop by 15% from last year to ₹750 crore.

Its Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA), grew by 6.7% from last year to ₹2,611 crore, better than the CNBC-TV18 poll of ₹2,536 crore.

EBITDA margin for the quarter narrowed by 10 basis points to 8.7% from 8.8% last year, better than the CNBC-TV18 poll estimate of 8.5%.Samvardhana Motherson’s revenue increased by 8.5% year-on-year to ₹30,173 crore better than the ₹29,800 crore estimate, according to the CNBC-TV18 poll. Wiring harness, integrated assemblies, vision systems will contributed to the revenue growth.

Industry outlook, efforts to increase the content per vehicle, ramp-up of utilization in non-auto and update on inorganic activities along with the impact of tariffs will be some of the most important aspects to watch from the management commentary.

Shares of Samvardhana Motherson ended 5.4% higher on Thursday at ₹111.6 after the earnings announcement.