Earnings Review
Samvardhana Motherson consol PAT halves on yr, misses view
This story was originally published at 18:04 IST on 13 August 2025
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--Samvardhana Motherson Q1 wiring harness EBITDA INR 9.83 bln vs INR 9.75 bln
--Samvardhana Motherson Q1 vision system EBITDA INR 4.73 bln vs INR 4.74 bln
--Samvardhana Motherson Q1 module, polymer EBITDA INR 9.6 bln vs INR 13.2 bln
--Samvardhana Motherson Q1 wiring harness sales INR 86.4 bln vs INR 83.3 bln
--Samvardhana Motherson Q1 vision system sales INR 51.37 bln vs INR 49.97 bln
--Samvardhana Motherson Q1 modules, polymer sales INR 150 bln vs INR 152 bln
--Samvardhana Motherson Apr-Jun consol EBITDA margin 8.2% vs 9.6% year ago
--Samvardhana Motherson Apr-Jun consol EBITDA INR 24.66 bln vs INR 27.85 bln
--Samvardhana Motherson Q1 profit excluding exceptional cost INR 6.48 bln
--Samvardhana Motherson Q1 net profit includes one-time cost INR 1.36 bln
--Samvardhana Motherson Q1 consol revenue INR 302.12 bln vs INR 289 bln
--Samvardhana Motherson Apr-Jun consol PAT INR 5.12 bln vs INR 9.931 bln
--Analysts saw Samvardhana Motherson Apr-Jun consol net profit INR 10.08 bln
--Samvardhana Motherson Apr-Jun consol net profit INR 5.12 bln
By Sunil Raghu
AHMEDABAD – Samvardhana Motherson International Ltd.'s consolidated net profit for the June quarter more than halved in the June quarter and the fall was way beyond what the Street had expected. The company's net profit fell for second quarter in a row, after on-year growth for five consecutive quarters. The fall in the key earnings metric was due to a drop in other operating income, higher raw material costs, higher employee costs and higher tax outgo. The company said that industry headwinds and volatility had a transitory impact on its profitability.
The consolidated net profit of the company, which manufactures automotive components, fell 48.51% on year and 51.28% from the trailing quarter to INR 5.12 billion in the June quarter from INR 10.51 billion in March quarter and INR 9.94 billion a year ago. Brokerages had pegged the bottom line at INR 10.1 billion for the quarter. The June quarter net profit includes a one-time cost of INR 1.36 billion that the company incurred in respect of phased operational restructuring of certain units in Europe. If not for this exceptional cost, the net profit of the company in June quarter would be INR 6.48 billion. It would still have been lower than the street estimates.
The company's consolidated revenue rose 4.66% on year and 3.05% on quarter to INR 302.12 billion. Analysts had estimated the top line at INR 311.5 billion.
The company, which has presence in around 44 countries, supplies components to popular brands such as Audi, Mercedes-Benz, BMW and Ford. The company's consolidated earnings before interest, tax, depreciation, and amortisation were INR 24.66 billion, down 11.45% on year from INR 27.85 billion. Brokerages had pegged it at INR 28.1 billion. The consolidated EBITDA margin for the June quarter was at 8.2% compared with 9.6% a year ago.
The modules and polymer products business--with a revenue of INR 150 billion against INR 152 billion a year ago--contributed the most to the company's top line during the June quarter. The segment EBITDA was INR 9.6 billion, down from INR 13.2 billion in the year-aago period. On other hand, its vision system sales for the June quarter were INR 51.37 billion, up 2.8% on year, with EBITDA of INR 4.73 billion, almost flat compared with INR 4.74 billion in June quarter a year ago. The sales of wiring harness segment were at INR 86.4 billion, up 3.7% on year, with EBITDA of INR 9.83 billion, up from INR 9.75 billion in June quarter last year.
"Our performance reflects the strength of our diversified business model and the operational efficiencies across our businesses. We are well-positioned to navigate evolving tariffs with the majority of our sales in the US being USMCA compliant. For non USMCA compliant parts, agreements with customers to pass on related costs are in progress, albeit with a lag. Further, recently levied tariffs on India do not have any material impact on our operations. While uncertainties in the business environment persist, it also offers inorganic opportunities for growth," Chairman Vivek Chaand Sehgal said in a press release issued post the earnings.
The company's total expenditure in the June quarter rose 6.55% on year to INR 294.08 billion, led by costs relating to raw materials, employee benefits, depreciation and other expenses. The cost of raw materials grew 4.67% on year to INR 162.38 billion, followed by employee-related costs, which increased 10.68% on year to INR 79.36 billion. Other expenses rose 6.60% on year to INR 36.75 billion. Depreciation costs rose 10.85% on year to INR 10.33 billion, while amortisation expense was up 48.27% on year at INR 1.97 billion.
The finance costs of the company fell 4.37% on year to INR 4.25 billion. The company had an inventory gain of INR 1.86 billion, up from INR 1.78 billion a year ago. The tax outgo for the quarter was INR 2.66 billion, down 23.64% from INR 3.48 billion a year ago.
The auto component maker had said it seeks to spend INR 12.08 billion as capex in the June quarter. The company had announced a capex of INR 60 billion for FY26. It also said that it operationalised three upcoming greenfield projects during the June quarter.
The company's net debt rose to INR 97.67 billion at the end of the quarter from INR 87.13 billion a quarter ago due to fluctuation in forex, the company said. The company's cash and cash equivalents rose to INR 82.23 billion at the end of Jun. 30 from INR 59.31 billion a quarter ago.
On Wednesday, shares of Samvardhana Motherson ended 3.5% higher at INR 93.39 on the National Stock Exchange. End
Edited by Akul Nishant Akhoury
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