Samvardhana Motherson International Limited (SAMIL) has taken a significant step towards consolidating its ownership of its technology subsidiary, Motherson Technology Services Limited (MTSL). The company has submitted an application to the National Company Law Tribunal (NCLT) Mumbai Bench for approval of a share capital reduction scheme in MTSL.

Key Details of the Application

• Application Date: October 15, 2025
• Regulatory Framework: Section 66 of the Companies Act 2013
• Current SAMIL Ownership in MTSL: 92.96% equity shareholding
• Post-Scheme Outcome: MTSL and its subsidiaries to become wholly-owned subsidiaries of SAMIL

Background and Implications

SAMIL had previously disclosed its intentions regarding this scheme on August 29, 2025. The move is part of a broader strategy to streamline the company's structure and potentially enhance operational efficiency.

Regulatory Compliance

The company has submitted this update in compliance with Regulation 30(7) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. This ensures transparency and keeps shareholders and the market informed about significant corporate actions.

Potential Impact

While the immediate impact on SAMIL's stock price may be limited, this development could have several implications:

1. It signals SAMIL's commitment to consolidating its tech operations under its direct control.
2. Full ownership of MTSL could potentially lead to more streamlined decision-making and resource allocation within the group.
3. The successful completion of this scheme may impact the group's financial statements in future quarters.

Investors and market watchers will now await the NCLT's decision on the application, which could have implications for SAMIL's corporate structure and potentially its future financial performance.

Note: As with any corporate action, investors are advised to conduct their own research and consult with financial advisors before making investment decisions based on this development.

Samvardhana Motherson International Limited (SMIL) has successfully raised INR 500 crores through the issuance of commercial paper, demonstrating its strong financial position and ability to secure short-term funding at competitive rates. Additionally, the company has announced a significant organizational change in its Slovakia operations.

Merger of Slovakia Subsidiaries

SMP Automotive Solutions Slovakia s.r.o., an indirect subsidiary of Samvardhana Motherson International Limited, merged with Motherson SAS Automotive Systems and Technologies Slovakia s.r.o. Following the merger completion, SMP Slovakia was deregistered from the Commercial Register and ceased to exist. Both entities were indirect wholly owned subsidiaries of Samvardhana Motherson International Limited. SMP Slovakia contributed INR 705.00 million in turnover (0.06% of total) and INR 72.00 million in net worth during the last financial year.

Key Details of the Commercial Paper Issuance

The commercial paper, an unsecured debt instrument, was issued on a private placement basis to Kotak Mahindra Bank Limited. The high credit ratings of ICRA A1+ and IND A1+ reflect the company's strong credit profile and low credit risk in the short term.

Listing and Trading Details

The commercial paper has been listed on the BSE Limited, with the scrip code 730372 and scrip ID SMIL091025. Trading members have been informed that the securities will be traded only in dematerialized form, with a standard denomination of INR 5 lakhs and multiples thereof. The tick size for trading has been set at 1 paise.

Implications for Investors and the Company

This successful issuance of commercial paper underscores SMIL's ability to access short-term funding at attractive rates. The 5.90% interest rate indicates favorable terms for the company, potentially reflecting strong investor confidence in SMIL's financial health and market position.

For investors, the high credit ratings and listing on the BSE provide an opportunity to invest in a low-risk, short-term debt instrument from a reputable company in the auto components sector.

Samvardhana Motherson International Limited's strategic use of commercial paper for short-term financing demonstrates its proactive approach to managing working capital and maintaining financial flexibility in a dynamic business environment. The merger of its Slovakia subsidiaries also indicates the company's efforts to streamline operations and potentially improve efficiency in its European operations.