Motherson Sumi shares fell as much as 9 per cent to hit an intraday low of Rs 258.75 after the auto component maker's biggest client Volkswagen admitted to fudging emission norms for diesel cars in the US.
Volkswagen has stopped selling diesel cars in the US with immediate effect and the German carmaker can face a potential fine of $18 billion, according to a Reuters report that quoted the US Environmental Protection Agency.
Of Motherson Sumi's revenue pie, 40 per cent comes from the Volkswagen group, making it the largest client for the Noida-based company. Out of this 10 per cent revenues come from the US market.
Fears of car sales in US hitting a roadblock could spill over to other markets as well, analysts said. Motherson Sumi can face slowdown in order flows post this development as it provides auto components for Volkswagen, Audi and other Volkswagen group companies, they added
Shares of Motherson Sumi ended 7.6 per cent lower at Rs 262. The stock underperformed the Nifty which closed 0.06 per cent lower.
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