Motherson Sumi Systems Limited is one of the country’s largest manufacturers of automobile wiring harnesses, passenger cars mirror, and automotive modules and components.
The total market cap of Motherson Sumi Systems Limited, as of June 18, 2018, is Rs.63,560 crore.
Company’s Wealth and Recent Performance
- For the fourth quarter of the financial year 2017-18, the company, along with its joint ventures and subsidiaries, reported an increase of 38% in revenue. The consolidated figure for the quarter stood at Rs.15,282 crore - its highest ever quarterly revenues. Its standalone revenue for the quarter also grew by 22% to stand at Rs.2,068 crore.
- Subsequently, Motherson Sumi Systems Limited in its report revealed its adjusted profit after tax for the March quarter to be at Rs.590 crore - an increase of 24% over the same quarter of the previous year. Its EBITDA was also up by 29% to Rs.1,667 crore.
- For the year ended on March 31, 2018, the company’s consolidated revenue from operations was stated to be at Rs.55,857 crore. Similarly, the EBITDA for the year stood at Rs.5,626 crore - an increase of 28% over the previous year. Lastly, its adjusted profit after tax for the FY 2017-18 was Rs.1,939 crore - a 25% increase over the PAT reported for the FY 2016-17.
- The MSSL order book, as of March 31, 2018, stood at Rs.1,29,785 crore or 17.2 billion Euros. Its consolidated revenues outside India grew by 35% while the same within the country grew by 21%. Its consolidated total assets are worth Rs.37,497.85 crore.
Motherson Sumi Systems Limited Stock Trends in 2018
- On January 2, 2018, the share price of Motherson Sumi Systems Limited was Rs.380.10 on the National Stock Exchange. The scrip maintained its bearings at this level for the first half of the month. Things changed slightly in the final days of the month when the stock price by roughly 5%. The closing price of the MSSL shares on January 31, 2018, was Rs.365.80.
- The first half of February was an uneventful one for the investors. The Motherson Sumi share price remained above Rs.355 up until February 14. Thereafter, driven by turbulent market conditions across the world, the price took a sharp nosedive and went down to be traded at levels varying from Rs.310 - Rs.320. In simpler terms, the scrip lost more than 10% in a week’s time.
- Things didn’t cool down in the month of March either. The rocky conditions prevailed and the Automobile stocks continued to suffer. The share price of Motherson Sumi remained above the Rs.300 mark, although it failed to recuperate its previous losses. The closing price on March 28 was Rs.310.95.
- The month of April brought some relief to the investors. The shares of Motherson Sumi bounced back handsomely to reach its previous levels. Even though these levels weren’t as impressive as the ones seen at the start of the year, the shareholders did benefit from its steady rise. The scrip rose by roughly 11% in the month to close at Rs.352.70 on the NSE.
- However, instead of continuing on this upward path, things took a turn in early May. The shares started to exhibit a bearish trend and as a result, they moved on to shed their previous gains. This time, the losses were far more severe than the ones seen in March. In fact, in late May, the Motherson Sumi share price hit its 52 week low of Rs.295. The closing price at the end of this turbulent month was Rs.310.15.
Motherson Sumi Systems Limited Stock Trends in 2016 and 2017
- At the start of 2016, the share price of Motherson Sumi Systems Limited was around Rs.196. Over the course of January, the stock went down by around 10%. This decline was observed through the most of February as well. In fact, by late February, the scrip had lost more than 25% in value since the start of the year. This drop was well in line with that of BSE SENSEX which shed more than 700 points in this period.
- However, the prices started to recover in early March driven by favourable market conditions. By the end of the month, the scrip had risen to reach its previous levels of Rs.170. An interim dividend of 250% was announced in the same month. Things did not change a lot in April as the shares continued to be traded at values between Rs.160 - Rs.180. It wasn’t May that the prices rose again and this time, they managed to move past the Rs.180 mark.
- This steady rise was seen through the month of June as well, with the Motherson Sumi shares occasionally crossing the Rs.200 mark during intraday sessions. Priced dipped slightly towards the end of the month but only to recover superbly in the subsequent weeks. By mid-July, the share price had entered the Rs.200 region and in early August, it reached a high of Rs.236.59 for the year. However, the prices dipped slightly towards the end of the month but the shares managed to retain their bearings at above Rs.200.
- The months of September and October were uneventful ones for the investors. The prices continued to fluctuate at levels above Rs.200 and below Rs.230, without any sharp increase or decrease. In November, post demonetisation, the scrip lost a little over 8% but soon bounced back. The closing price at the end of the year was Rs.217.63 on the National Stock Exchange.
- 2017 turned out to be a terrific year for the Motherson Sumi Systems shareholders. In early January, the opening price of the scrip was Rs.218.16. By the end of the month, the stock had improved marginally by roughly 5% and moved on to rise further in the subsequent weeks. The stock price continued to rise through the months of February and March with the shares making substantial gains. On March 31, the MSSL shares closed trading at Rs.247.93 - an increase of more than 15%.
- The bull run continued in the next quarter as well. The Mother Sumi Systems share price crossed Rs.250 in early April and continued to move on its upward trajectory. This rise was well in line with that of BSE SENSEX which also rose superbly in this period. By late May, the scrip had entered the Rs.300 region and further moved on to be traded at levels above the Rs.300 mark.
- In June, the shares changed hands at values above Rs.300 and below Rs.320. The prices dipped slightly towards the end of the month, but they scrip still maintained its bearings above the Rs.300 mark. In July, Motherson Sumi announced bonus shares in 2:1 ratio which helped the stock price rise further. After being traded at levels around Rs.330 for a short while, the prices dipped by slightly 5%. A final dividend of 200% was also announced in the same month.
- The prices continued to rise in September and in mid-October, the share price of Motherson Sumi Systems crossed Rs.350. For the rest of the year, the stock price remained well-above this mark with the scrip reaching its 52-week high at Rs.395.60 in late December. The closing price at the end of the year was Rs.379.25 on the NSE.
Should you invest in Motherson Sumi Systems Limited?
- Since the start of 2017, the share price of Motherson Sumi Systems Limited has risen by more than 50% to reach its present levels at Rs.305 as of mid-June, 2018. The scrip was on the verge of entering the Rs.400 territory in late December but its rise was halted by turbulent market conditions.
- Considering the financial performance of the company, the MSSL group in its most recent results reported excellent figures. Its consolidated sales for the year improved by 33% while its profit after tax improved by 25%. Its order book also reached its highest level at Rs.1.3 lakh crore. Furthermore, the company is fundamentally strong and is constantly improving its business portfolio.
- At the same time, the stock price of Motherson Sumi may seem slightly expensive, considering that it has risen by more than 50% while its revenues have improved by 33% in the last one year. It may be feasible to wait for the price to come down and then purchase this stock. Alternately, you can also buy this stock on dips.
- You can also look into mutual funds houses which have invested in this stock. In addition to this, you can also compare the performance of this company with its peers although, in terms of profits and market capitalisation, it is at the second place right behind Bosch. However, before you invest in this company, we strongly advise you to conduct a thorough research.
Motherson Sumi Systems Limited is a leading player in the automotive ancillary products and services sector. The company is present in more than 35 countries and its product offerings range from air intake manifolds, lighting systems, automotive mirrors, electrical distribution systems, pedal box assembly, waste recycling systems and HVAC systems. The company also provides manufacturing support in the form of paint coating equipment, air compressors, et cetera. In addition to this, MSSL specialises in metalworking with its expertise ranging from manufacturing customised cutting tools to machining high precision parts.
History of the Company
Motherson was founded in the year 1975 and within two years since its inception, its first cable factory was set up. In 1983, Motherson signed a technical agreement with Japan-based Tokai Electric Company. This eventually led to the establishment of Motherson Sumi Systems Limited - the joint venture between the Motherson Group and the Sumitomo Wiring Systems Limited. Over the course of next decade, the company broadened its product portfolio and started designing and manufacturing cutting tools, injection moulding, cockpit assemblies, automotive mirrors, et cetera. In 1993, Motherson Sumi Systems Limited went public and its shares were listed on the stock exchanges in India. In 1999, the company set up its first overseas office in Austria. It continued to expand over the course of next decade through various joint ventures and acquisitions.
Management of the Company
- Chairman - Mr. Vivek Chaand Sehgal
- Director - Mr. Toshimi Shirakawa
- Whole-time Director and Chief Operating Officer - Mr. Pankaj Mittal
- Director - Ms. Noriyo Nakamura
Motherson Sumi Systems Limited Listings in NSE, BSE, and Indices
The shares of Motherson Sumi Systems are listed on the National Stock Exchange of India Limited and the Stock Exchange, Mumbai. The respective codes for the same are as follows:
- NSE Code: MOTHERSUMIEQ
- BSE Code: 517334
- ISIN Code: INE775A01035
- Sector: Automobile Ancillaries and Electricals
Coming to the stock market indices in India, the stock is not a part of BSE SENSEX and NIFTY 50. However, it does comprise the following:
- NIFTY 100
- NIFTY 500
- NIFTY 200
- NIFTY Auto
- NIFTY Next 50
- S&P BSE 100
- S&P BSE 200
- S&P BSE Auto
- S&P BSE AllCap
- S&P BSE LargeCap
Plot No. 1, Sector 127
Noida-Greater Noida, Expressway
Noida - 201310
Uttar Pradesh, India
Contact number: +91-120-6679500
Email Id: email@example.com
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