Strong order book, margin gains ahead for Motherson

Though Q2 was a bit disappointing, analysts expect numbers to improve in the second half due to ramp-up of operations at new plants

Motherson Sumi’s September quarter (Q2) results were marginally lower than estimates due to slowing revenue growth and margin pressure at its overseas subsidiaries, SMR and SMP, respectively. Consolidated operating profit, which came in at Rs 1,250 crore (up 26 per cent year-on-year or y-o-y), was about five per cent lower than consensus estimates. Adjusted for the PKC group acquisition, operating profit growth was limited to 11 per cent. Over 85 per cent of revenue and 74 per cent of operating profit for Motherson Sumi comes from its overseas operations of SMR, SMP and PKC.

Operating profit margins fell 50 basis