Latest news with #SAMIL
&w=3840&q=100)
Business Standard
a day ago
- Business
- Business Standard
US tariffs: Fitch cautions rising second-order risks may hit India Inc
Global rating agency Fitch on Tuesday said Indian companies in sectors such as pharmaceuticals may be hit by further US tariff announcements, while cautioning about the rising risk of second-order effects from existing tariffs to India Inc. India-based corporations generally have low direct exposure to US tariffs, but sectors that are currently unaffected, including pharmaceuticals, could be hit by further US tariff announcements. A US-India trade deal, if secured, would reduce these risks, the agency said in a statement. The United States (US) imposed 25 per cent reciprocal tariffs on India with effect from August 7 and an additional 25 per cent in connection with its oil imports from Russia, effective August 27. The US delegation was slated to visit India next week for negotiations on a trade deal, but it has been postponed without any announcement on new dates. The US is a key export destination for Indian pharmaceutical companies. Biosimilars-focused Biocon Biologics Limited derives around 40 per cent of its sales from the US, mostly from production sites in India and Malaysia. Significant US tariffs on pharmaceutical products are not yet factored into the rating base case and could pose downside risks to its operating performance. The competitive industry landscape could limit Biocon's ability to pass on higher costs, despite the non-discretionary demand for its products, it added. Referring to the tariffs slapped for Russian oil imports, Fitch said Russian crude accounts for about 30-40 per cent of crude imports for Indian oil marketing companies (OMCs), with its discounted price supporting their earnings before interest, taxes, depreciation, and amortisation (Ebitda) and profitability. Our base case is that the Indian government will not limit purchases of Russian crude by oil marketing companies. If these were curtailed, it would hurt OMCs' Ebitda, but we estimate that the Ebitda impact would be around 10 per cent in the case of a full halt. The support-driven OMCs' Issuer Default Ratings, such as those of Bharat Petroleum, Indian Oil, and Hindustan Petroleum would be unaffected under this scenario. HPCL-Mittal Energy Ltd, however, has a lower rating buffer and its credit profile could be more vulnerable to a sharp deterioration in earnings that could hinder its deleveraging prospects, Fitch said. India's direct automotive exports to the US, including parts, are limited. The US accounts for close to 20 per cent of sales for auto supplier Samvardhana Motherson International Ltd (SAMIL), but mostly from production bases in the US, or those in Mexico that benefit from tariff exemptions under the United States-Mexico-Canada Agreement. Fitch had revised the outlook for SAMIL to 'stable' from 'positive' in May, reflecting the agency's expectation that a weakened global auto sector outlook amid tariff-related uncertainty would limit further improvement in SAMIL's financial leverage, it added.
New Indian Express
a day ago
- Business
- New Indian Express
Fitch warns of rising risks to Indian firms from higher US tariffs
MUMBAI: Fitch Ratings has cautioned that while Indian corporates currently face limited direct exposure to recent US tariff hikes, the risks are mounting — particularly for pharmaceuticals, chemicals, and oil-linked sectors. The rating agency said a US-India trade deal would be key to mitigating these pressures. Fresh tariff measures The US imposed 25 per cent 'reciprocal' tariffs on Indian goods from August 7, 2025, followed by an additional 25 per cent levy tied to oil imports from Russia, effective August 27. Fitch noted that while India's direct automotive exports to the US are small, the broader outlook for the auto sector has weakened. Samvardhana Motherson International Ltd (SAMIL), which derives about 20% of its sales from the US, largely through production bases in the US and Mexico, could see limited upside in its credit profile. Fitch revised its outlook on SAMIL to Stable from Positive in May, citing tariff-driven uncertainty in the global auto market. Pharma and chemicals vulnerable The US remains a critical market for Indian pharma. Biocon Biologics Ltd earns nearly 40 per cent of its revenues from the US, with products manufactured in India and Malaysia. Fitch warned that fresh tariffs on pharma products, if imposed, would hit Biocon's operating performance and erode its ability to pass on higher costs.
&w=3840&q=100)
Business Standard
6 days ago
- Business
- Business Standard
What are brokerages saying about this auto components maker post Q1 show?
Samvardhana Motherson Q1 results impact, analysis: Auto components major Samvardhana Motherson International (SAMIL) posted a weak June quarter (Q1FY26), with profitability hit by cost pressures, delayed client programmes, and start-up expenses at new plants. Yet, several brokerages remain optimistic on its medium-term prospects, citing strong execution capabilities, diversified presence, and resilient order book. On the bourses, Samvardhana Motherson shares fell up to 1.91 per cent to an intraday low of ₹91.65 per share. Around 9:40 AM, the stock was trading 1.10 per cent lower at ₹92.41. In comparison, BSE Sensex was flat with a positive bias at 80,570.65 levels. FOLLOW LATEST STOCK MARKET LIVE UPDATES Samvardhana Motherson Q1 performance SAMIL's consolidated net profit fell 48.5 per cent year-on-year (Y-o-Y) to ₹512 crore against ₹994 crore in the year-ago period, dragged by softer margins and higher costs. Revenue rose 4.7 per cent Y-o-Y to ₹30,212 crore from ₹28,868 crore, aided by steady volumes across geographies. Ebitda dropped 11.4 per cent Y-o-Y to ₹2,458 crore, with operating margins slipping to 8.1 per cent in Q1FY26, from 9.6 per cent last year. Brokerage views: Cautious short term, constructive long term Motilal Oswal noted that adjusted PAT of ₹620 crore missed its estimate by a wide margin due to multiple headwinds pressuring margins. Management indicated most cost escalations were temporary, expecting performance to revive from Q3 as Q2 tends to be seasonally weak in Europe. The brokerage cut FY26 and FY27 earnings estimates by 9 per cent and 2 per cent, respectively, but retained its 'Buy' rating with a revised target price of ₹114 (24x Jun'27E EPS). Nuvama said revenue growth of 5 per cent Y-o-Y was in line with expectations, but Ebitda missed estimates by 5 per cent due to delayed European model launches, integration adjustments, and greenfield start-up costs. It cut FY26E/27E Ebitda by 4 per cent/5 per cent, but maintained a 'Buy' rating, citing strong management, robust order book, and rising content per vehicle. Its revised TP stands at ₹110 (earlier ₹117). ALSO READ | Apollo Hospitals Q1: Analysts up targets, share outlook; buy, sell or hold? JM Financial pointed to structural challenges in the EU, tariff-associated costs, and greenfield start-up expenses as key drags on margins, which at 8.1 per cent were 100 bps below its estimates. While global light vehicle demand remains subdued, SAMIL is outperforming through higher content per vehicle driven by premiumisation. Meanwhile, JM expects near-term margin pressures to persist given weak demand in developed markets and ramp-up costs, and has trimmed FY26E/FY27E Ebitda margin forecasts by 20 bps/30 bps. Still, it maintained a 'Buy' rating with a March 2027 target of ₹110 (19x FY27E EPS), flagging recovery in global LV demand as a key monitorable. Jefferies reportedly maintained its 'Buy' stance with a reduced target of ₹110 (from ₹120), noting that margins should improve as European cost optimisation and plant ramp-ups take hold. The brokerage also highlighted SAMIL's ongoing diversification into non-auto segments, especially electronics. ALSO READ | Samvardhana Motherson outlook: Temporary pain, structural positives Across the board, brokerages see Samvardhana Motherson's Q1 weakness as transitory, with cost headwinds, delayed programmes, and plant ramp-ups expected to normalise over the next few quarters. Geographic diversification, a proximity-to-customer model, and expansion into higher-value segments like automotive electronics position SAMIL to navigate trade risks and macro softness. Consensus remains positive, with all four brokerages maintaining 'Buy' ratings despite trimming near-term forecasts. The Street expects margin recovery from H2FY26, backed by operating leverage, greenfield scale-up benefits, and integration synergies from recent acquisitions.
&w=3840&q=100)
Business Standard
6 days ago
- Business
- Business Standard
Samvardhana Motherson Q1: Analysts eye H2 rebound despite margin hit
SAMIL's consolidated net profit fell 48.5 per cent year-on-year (Y-o-Y) to ₹512 crore against ₹994 crore in the year-ago period, dragged by softer margins and higher costs. Tanmay Tiwary New Delhi Listen to This Article Samvardhana Motherson Q1 results impact, analysis: Auto components major Samvardhana Motherson International (SAMIL) posted a weak June quarter (Q1FY26), with profitability hit by cost pressures, delayed client programmes, and start-up expenses at new plants. Yet, several brokerages remain optimistic on its medium-term prospects, citing strong execution capabilities, diversified presence, and resilient order book. On the bourses, Samvardhana Motherson shares fell up to 1.91 per cent to an intraday low of ₹91.65 per share. Around 9:40 AM, the stock was trading 1.10 per cent lower at ₹92.41. In comparison, BSE Sensex was flat with a positive bias at 80,570.65 levels. Samvardhana
Time of India
13-08-2025
- Business
- Time of India
Samvardhana Motherson Q1 revenue rises 5%; sees minimal impact from US tariffs
Samvardhana Motherson International (SAMIL) on Wednesday said the recently announced US tariffs on imports from India will have little effect on its operations, with exports to the US amounting to less than $10 million in the April–June quarter of FY26. In Q1 FY26, consolidated revenue rose 5 per cent to ₹30,212 crore from ₹28,868 crore a year earlier. However, EBITDA margins fell to 8.2 per cent from 9.6 per cent, impacted by structural challenges in Europe, currency volatility, and start-up costs for new projects. According to the company's latest investor presentation, most contracts are on an ex-works basis, with customers covering shipping and import costs. For the limited contracts where this does not apply, Motherson is taking mitigation measures, including exploring alternative supply chain solutions. A large portion of its US sales already meet US-Mexico-Canada Agreement (USMCA) rules, shielding them from the new tariffs. For non-USMCA compliant products, the company is in talks with customers to pass on the added costs, though some time lag is expected. Shares of the auto components major climbed as much as 4.45 per cent on Wednesday after management assured investors that the tariffs announced by the Donald Trump administration would not materially affect operations.
