Samvardhana Motherson share price rises 2% post Q4 results, dividend announcement: Should you buy or sell the stock?

Stock Market Today: Samvardhana Motherson share price gained more than 2% in the morning trade on Friday, following the announcement of its Q4 results and final dividend.

Samvardhan Motherson reported its highest-ever sales of ₹113,663 crore for FY25, marking a 15% YoY growth. EBITDA grew by 17% to ₹10,877 crore, and net profit surged 40% to ₹3,803 crore, underscoring strong operational efficiency and cost discipline. 

In Q4FY25, revenue rose 6% to ₹29,316.83 crore, while EBITDA declined slightly by 1.6%, with margins down 70 bps — hinting at short-term cost pressures. Despite this, the net profit rose 20% to ₹1,050.5 crore.

Analyst views post Q4 results

Jefferies India said that Samvardhana Motherson International's performance missed estimates, however, expansion in the electronics business is a positive.

Samvardhana Motherson's reported Q4 EBITDA fell 10% YoY and was 11% below Jefferies' estimate on account of lower margins. EBITDA margins contracted 4.3 percentage points YoY in polymers and one percentage point YoY in vision and integrated assemblies. 

However, Jefferies added that Samvardhana Motherson is rapidly expanding its non-auto business, especially in electronics. The brokerage cut its FY26-27 estimated earnings per share (EPS) by 14-19%, but retained a ‘Buy’ rating on Samvardhana Motherson stock, with a revised price target of ₹180.

Weak volume growth outlook and US tariff uncertainty remain growth headwinds for Samvardhan Motherson, according to Nomura. 

Hence, the global brokerage has lowered organic growth in polymer/vision to 0% from 5% earlier. “However, ramp-up in the consumer electronics and entry into newer segments, with potential acquisition opportunities, can keep driving strong earnings growth and diversify its mix further,” Nomura added.

The brokerage has raised the target price-to-earnings to 19 times (18 times earlier), in the middle of its expected trading band of 18-20 times, to factor in potential upside from new segments, inorganic opportunities, etc. 

Nomura has arrived at its new target price for Samvardha shares at ₹170 (from ₹155 earlier). The global brokerage finds the current valuation at 17.5 times FY27F EPS attractive, given a 27% EPS CAGR over FY25-27 estimates.

Seema Srivastava, Senior Research Analyst at SMC Global Securities, said that the company outpaced the industry by ~15%, supported by content growth and M&A synergies. 

“A solid ROCE of 17.2%, despite ongoing capex and expansions, indicates prudent capital allocation. Leverage remains comfortable at 0.9x Net Debt/EBITDA, with working capital improvements likely to support further deleveraging. Strategic investments of ₹4,433 crore in FY25 align with its calibrated growth approach. With 14 greenfield projects in progress and 9 expected to launch in FY26, future growth appears well-anchored,” she added.

The booked business value of $88+ billion, including non-auto segments, reflects successful diversification. A bonus issue (1:2) adds shareholder value. The company has effectively mitigated trade barriers and maintained strong customer engagement. Motherson’s adaptability and global-local strategy reinforce its position for sustained long-term growth, said Seema Srivastava, Senior Research Analyst at SMC Global Securities.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.