Samvardhana Motherson - Vision 2025, Aspirations Unchanged: Motilal Oswal

It aspires for revenue of $36 billion with 40% RoCEs, further diversification of revenue and 40% dividend payout.

<div class="paragraphs"><p>A staff at Motherson Sumi Systems' wiring division. (Source: Company website)</p></div>
A staff at Motherson Sumi Systems' wiring division. (Source: Company website)

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Motilal Oswal Report

Samvardhan Motherson International Ltd. reiterated its Vision 2025 (five-year plan set in April 2020) despite the first half of the plan period witnessing incessant challenges.

It aspires for: revenue of $36 billion (including notable contribution from mergers and acquisitions) with 40% return on capital employed, further diversification of revenue (3CX10 – no component, customer or country more than 10% of revenue) and 40% dividend payout.

The vision entailed 25% of revenue from non-auto segment. Annualised revenue run-rate was at $12 billion and adjusted RoCEs (for new plants and acquisitions) stood at 19% (8% reported) for H1 FY23.

Samvardhan Motherson’s revenue aspiration of $36 billion is based on four pillars:

  1. strong organic growth as global passenger vehicle production normalises after last three years of headwinds,

  2. content increase through premiumisation (more luxury cars and more higher trim levels) and electric vehicles,

  3. increasing contribution from nonauto, and

  4. acquisitions.

Global PV production bottomed out in FY22 at 76.5 million units (from peak of 95.1 million in FY18) and H1 FY23 annualised rate is 83.1 million units.

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Motilal Oswal Samvardhan Motherson Update.pdf


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