Samvardhana Motherson International Limited — Q3 FY26 earnings call

Call held 10 Feb 2026

Management summary

Samvardhana Motherson International Limited delivered a strong Q3 FY26, achieving its highest ever quarterly revenues of INR 31,409 crores, a 14% YoY increase, and a 21% YoY growth in normalized PAT. This performance was driven by healthy organic growth and strategic acquisitions, despite a de-growth in global PV production. The company continues to invest in future growth with 12 Greenfield projects underway and maintains a healthy net leverage of 1.1x.

Highlights

  • Highest ever quarterly revenues of INR 31,409 crores, marking a 14% YoY growth.

  • Normalized Q3 PAT increased by 21% YoY to INR 1,061 crores.

  • EBITDA for the quarter stood at INR 3,042 crores.

  • Net leverage remained comfortable at 1.1x net debt to LTM EBITDA, well within stated financial policy.

  • Consumer electronics business recorded 75% QoQ revenue growth and aerospace business grew 41% YoY.

Concerns

  • Global PV production de-grew year-on-year in Q3 FY26.

  • Platform mix-driven softness observed in developed markets.

  • Normalized PAT included a post-tax impact of INR 37 crores, primarily due to new labor code implementation (INR 25 crores) and transformative measures in Europe (INR 12 crores).

Key financials

2 periods

Headline

  • Revenue
    ₹31,409 Cr
    YoY +14%
  • EBITDA
    ₹3,042 Cr
  • Normalized PAT
    ₹1,061 Cr
    YoY +21%
  • Net Leverage
    1.1×

Q3

  • Capex
    ₹1,594 Cr

What they filed

Q1 FY27: revenue up 16.7%, net profit up 77.6% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue27,812 27,666 29,317 30,212 30,173 +8%31,409 +14%34,309 +17%35,244 +17%
EBITDA2,448 2,686 2,643 2,458 2,611 +7%3,043 +13%3,791 +43%3,096 +26%
Net profit949 984 1,115 606 846 −11%1,072 +9%1,562 +40%1,076 +78%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

  • Emerging Businesses (Consumer Electronics & Aerospace)
    50% Growth
  • Consumer Electronics
    75% Revenue Growth
  • Aerospace
    41% Growth

Capital allocation

high confidence
  • Capex ₹1,594 Cr this quarter · ₹6,000 Cr (FY26) planned
    • Reinvestment into the business ₹1,594 Cr
    • Greenfield facilities (Vision Systems in India, Wiring Harness in Morocco)
    In addition to delivering strong financial performance, we continue to maintain disciplined capital allocation with approximately INR 1,594 crores being reinvested into the business for capex.
  • Debt 1.1× EBITDA
    Our net leverage stands at 1.1x, well before our stated financial policy.
  • M&A Nexans Autoelectric wiring harness business Acquisition · Announced

    Provide SAMIL a scalable platform for PV and CV growth globally.

    During the quarter, we also signed an agreement to acquire 100% of the wiring harness business of Nexans Autoelectric, which will provide SAMIL a scalable platform for PV and CV growth globally. This acquisition is expected to be completed by the end of H1 FY '26.
  • M&A Yutaka Giken Acquisition · Pending regulatory
    The earlier announced acquisition of Yutaka Giken in Japan is expected to close in the first half of FY '26 and our tender offer to Yutaka's public shareholding, which is about 30%, has already commenced on the 9th Feb.

Guidance & targets

Capacity

  • Consumer electronics annual capacity Capacity · end of current fiscal year (FY26) · High confidence ~16 million units
    The consumer electronics business is ramping up as planned with 2 operational plants on track to achieve an annual capacity of approximately 16 million units by end of the current fiscal year.

    — Laksh Vaaman Sehgal

  • Third consumer electronics plant operations Capacity · Q3 FY27 · High confidence Commence operations
    The third plant is expected to commence operations in the third quarter of FY '27.

    — Laksh Vaaman Sehgal

  • Greenfield plants coming on stream Capacity · H2 FY27 · High confidence Majority on stream
    The majority of these Greenfields are expected to come on stream by the second half of FY'27 and will contribute towards growth in the FY' 27 year.

    — Laksh Vaaman Sehgal

Capex

  • FY26 Capex Capex · FY26 · High confidence around INR 6,000 crores plus 10%
    So earlier this year, we gave guidance of around INR 6,000 crores plus 10%. We believe our exit number would be well within this guidance.

    — Gandharv Tongia

Profitability

  • ROCE for new ventures Profitability · down the path · Medium confidence 40%
    And they have to show us a possibility to deliver 40% ROCE down the path.

    — Laksh Vaaman Sehgal

  • Q4 FY26 Performance Profitability · Q4 FY26 · Medium confidence even better
    So, we are 1 quarter down, and we feel the thing is going to be even better in the fourth quarter, because I think most of our copper scenarios will play out.

    — Vivek Chaand Sehgal

Market context

  • Global PV Production Volume · FY27 · High confidence ~93 million units

    From ~91 million units today

    The latest global PV production outlook remains encouraging with FY'27 production projected to grow approximately around 93 million units, up from around 91 million units expected in FY '26.

    — Laksh Vaaman Sehgal

What to watch in Q4 FY26

FY27 Capex Guidance

March year-end call
Current Management will provide FY27 capex update in March year-end call.
Target Specific FY27 capex plan.

Why it matters

Provides clarity on future investment plans and growth strategy, impacting long-term capacity and revenue potential.

As far as next year is concerned, allow us a quarter. During the March year-end call, we'll probably give you update on the next year's capex outflow.

Risks & concerns

  • Global PV Production De-growth

    medium

    Global PV production de-grew YoY in Q3 FY26, with platform mix-driven softness in developed markets.

    Management acknowledged

  • Chinese OEM Competition in Europe

    medium

    Analyst raised concerns about Chinese OEMs becoming bigger in Europe, but management expressed confidence in product quality regardless of origin.

    Analyst downplayed

  • Commodity Cost Fluctuations

    low

    Analyst asked about rising commodity costs impacting margins, but management stated operational improvements are the main driver for margin expansion in modules and polymer.

    Analyst acknowledged

Q&A highlights

5 direct, 1 evasive
Synergies and capital efficiency in new ventures (aerospace, consumer electronics, health, medical CDMO) Direct
Look, everything is driven by our focus, which is to be a globally preferred sustainable solution provider. So, with an open mind and this 'Not Yet' attitude of Motherson, of course, we get a lot of opportunities, but we are extremely selective for the ones that we go after. And they have to show us a possibility to deliver 40% ROCE down the path.

Analyst questioned how Motherson leverages its platform for long-term optionality and capital efficiency across new, diverse divisions, and management clarified their strategic focus on 40% ROCE and selective, customer-driven expansion.

Asked by Sajal Kapoor

"Fail-fast" model for new ventures Direct
For the newer ones, we have a relatively more de-risked way by joining up with partners like we have done in consumer electronics. And even in the aerospace side, if you see our entry was through partnering with a company called CIM Tools, which already had that customer portfolio and those technologies in there.

Analyst inquired about Motherson's R&D and experimentation strategy, and management confirmed a de-risked approach by partnering with established entities to scale successful ventures.

Asked by Sajal Kapoor

Sustainability of margin expansion in modules and polymer division Direct
So, we did announce that in the previous quarters of some restructuring costs that we had taken and you're seeing the benefits of that. Of course, I think there's always more to do, to drive more efficiencies with the onset of Al, with the onset of more automation, our focus on robotics, our in-house capabilities.

Analyst questioned the drivers and sustainability of margin improvement in a key segment, and management attributed it primarily to past restructuring benefits and ongoing efficiency drives.

Asked by Nitij Mangal

Risk from Chinese OEMs in Europe Evasive
I don't think we take a guess as to which one is going to do better or not. Look, automotive business, you've been there for some time, but we've been there for a long, lifetime actually. We've seen somebody going down and then with the next model, next thing, he is back on the top.

Analyst raised a sector-specific competitive risk, and management expressed confidence in product quality and market resilience rather than speculating on specific OEM origins.

Asked by Nitij Mangal

Consumer electronics ramp-up and future activity Direct
Yes. Look this plant that's coming up is fully already spoken for. But this has opened up a lot of doors for other customers. We will be coming back to you in time and telling you about other wins.

Analyst sought details on the progress and future plans for the high-growth consumer electronics segment, and management indicated strong demand for new capacity and future customer wins.

Asked by Nitij Mangal

Contribution of consumer electronics and aerospace to emerging business revenue Partial
Siddhartha, as you know, our emerging business has registered a fair amount of growth, is more than 50%. It has mainly two major components. One is that two set of businesses which you called out, which has registered a fair amount of growth. Consumer electronics has grown sequentially by 75% and Aero has also registered a year-on-year growth of north of 40%.

Analyst asked for a breakdown of emerging business revenue, and management provided growth rates for key components without specific revenue amounts.

Asked by Siddhartha Bora

Integrated assemblies facility segment margin improvement Direct
But in the last couple of years, working together, we've also been able to enhance their capabilities, go after some product line that they were not doing before, doing some more manufacturing in-house to support their kind of operations. And, of course, the focus on the financial discipline that Motherson brings together with the expert leadership of Frederic over there, really turned up the keys to the next level.

Analyst inquired about the drivers of margin improvement in this segment, and management detailed the benefits of integration, group synergies, in-house manufacturing, and financial discipline.

Asked by Aniket Mhatre

Capex for FY26 and FY27 guidance Partial
So earlier this year, we gave guidance of around INR 6,000 crores plus 10%. We believe our exit number would be well within this guidance. As far as next year is concerned, allow us a quarter. During the March year-end call, we'll probably give you update on the next year's capex outflow.

Analyst sought clarity on current and future capex plans, and management confirmed FY26 guidance while deferring FY27 guidance to the next call.

Asked by Aniket Mhatre

2 min read 6 chapters

Detailed narrative

Strong Q3 FY26 Financial Performance

Samvardhana Motherson International Limited reported its highest ever quarterly revenues of INR 31,409 crores in Q3 FY26, marking a 14% year-on-year growth. This was supported by a 21% year-on-year increase in normalized PAT, reaching INR 1,061 crores, and an EBITDA of INR 3,042 crores. The robust performance was driven by healthy organic growth, the consolidation of the Atsumitec business, and favorable foreign exchange movements, despite a de-growth in global PV production during the quarter.

Strategic Investments and Greenfield Expansion

The company continues its investment strategy, reinvesting approximately INR 1,594 crores into the business for capex during Q3 FY26. Two new Greenfield projects were announced, bringing the total to 12 under development across emerging markets, including a Vision Systems plant in India and a Wiring Harness facility in Morocco. The majority of these new facilities are expected to become operational in the second half of FY27, contributing significantly to future growth.

Growth in Emerging Businesses

Motherson's consumer electronics and aerospace businesses demonstrated strong momentum, growing 41% year-on-year in Q3 FY26. The consumer electronics segment specifically saw a 75% quarter-on-quarter revenue growth and meaningful margin improvement, with plans to achieve an annual capacity of approximately 16 million units by the end of FY26. A third plant for consumer electronics is expected by Q3 FY27, which will double current capacity and enhance vertical integration.

Acquisitions and Strategic Partnerships

The company signed an agreement to acquire 100% of Nexans Autoelectric's wiring harness business, expected to close by H1 FY26, providing a scalable platform for PV and CV growth globally. Additionally, the acquisition of Yutaka Giken in Japan is anticipated to close in H1 FY26, with a tender offer for public shareholding already commenced. Strategic partnerships include a dedicated RoRo terminal at Dighi Port, Maharashtra, and a joint venture with Egtronics Company Limited for clean mobility electronics.

Financial Discipline and ROCE Focus

Motherson maintained strong financial discipline, with its net leverage standing at a comfortable 1.1x net debt to LTM EBITDA, well within its stated financial policy. For new ventures, the company is highly selective, pursuing opportunities that demonstrate a clear path to delivering 40% ROCE. This approach leverages group synergies, technology partners, and a de-risked 'fail-fast' model to scale successful initiatives, ensuring long-term sustainable value.

Outlook and Future Expectations

Management expressed optimism for the future, expecting Q4 FY26 to be 'even better' than Q3, with positive developments anticipated from copper scenarios and final customer payments. The global PV production outlook for FY27 projects growth to approximately 93 million units, up from 91 million units in FY26, reinforcing the company's growth trajectory. The FY26 capex guidance of 'around INR 6,000 crores plus 10%' is expected to be met, with FY27 capex guidance to be provided in the March year-end call.

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