Samvardhana Motherson Q2 Results: Net Profit Nearly Doubles to ₹880 Cr

Samvardhana Motherson International Ltd. (SAMIL), a leading auto component manufacturer, announced its financial results for the quarter ended September 2024 (Q2 FY25) on November 12. Samvardhana Motherson's consolidated net profit showed remarkable growth, soaring by 222.5% to ₹948.81 crore, compared to ₹294.15 crore during the same period last year. Net profit nearly doubled from the previous quarter, increasing by 95%, from ₹451 crore in Q2 FY24 to ₹880 crore in Q2 FY25. Revenue for the quarter was ₹27,812 crore, marking a 18% growth from ₹23,527 crore in the same period last year. 

The company's Earnings Before Interest, Tax, Depreciation, and Amortisation (EBITDA) stood at ₹2,463 crore, which represented a 23% year-on-year growth. Its Return on Capital Employed (RoCE) increased to 17.3%, compared to 16.9% in the same period last year.

Samvardhana Motherson Q2 Results Quick Insights:

• Revenue: ₹27,812 crore, up by 18% YoY
• Net Profit: ₹880 crore, up 95% YoY
• Segment Performance: The company’s automotive segment continued to drive growth, with the order book nearing $88 billion.
• Management’s Take: Growth driven by both automotive and non-automotive business. Outlook remains positive.
• Stock Reaction: Q2 results were announced on Tuesday, during trading hours. Its shares closed at ₹163.90, down by approximately 6.25%

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Management Commentary

Mr. Vivek Chaand Sehgal, Chairman, Motherson while commenting on the results said, “These results highlight our strength and adaptability in an uncertain business environment. Our prudent management of the leverage ratio has positioned us well for sustainable growth. This strategic approach ensures that we maintain a healthy balance sheet while continuing to invest in the future. Our automotive booked business is USD 88 billion approx. and has been growing consistently, reflecting the trust our customers have in us. Our non-automotive businesses have been growing consistently, contributing to overall growth with stability and diversification. With the support of our customers and the hard work and dedication of our global teams, we have built a resilient organisation that is ready for continued success.”

The management highlighted that the company’s current leverage ratio positions it for long-term sustainable growth. The company’s leverage ratio has improved, decreasing to 1x from 1.5x previously. The automotive business continues to perform strongly, with an order book nearing $88 billion, while the non-automotive sector also shows steady growth. Out of the 19 planned greenfield facilities, five are already operational, and an additional eight are expected to be launched in the second half of the current financial year.

Stock Market Reaction After Quarter Results

Following the Q2 results, Samvardhana Motherson’s shares closed at ₹163.90, down by approximately 6.25% on NSE. The stock has dropped 25% from its recent high of ₹217.

About Samvardhana Motherson Ltd.

Samvardhana Motherson International Ltd. is one of the world's largest automotive component suppliers, serving original equipment manufacturers (OEMs) globally. Established in 1986 as a joint venture with Sumitomo Wiring Systems, the company has grown to support nearly all major automobile manufacturers worldwide. It operates over 400 facilities across 44 countries and has diversified into non-automotive sectors such as healthcare, aerospace, and industrial solutions.