Samvardhana Motherson International has received a buy recommendation from Nomura Securities, with the global brokerage firm setting a target price of ₹125.00 per share. This positive analyst call reflects institutional confidence in the auto ancillary company's business fundamentals and growth trajectory.

Analyst Recommendation Details

The recommendation from Nomura represents a significant vote of confidence in Samvardhana Motherson International's market position and operational performance. The target price of ₹125.00 suggests the brokerage sees upside potential in the stock based on their analysis of the company's financials and sector outlook.

Market Context

Samvardhana Motherson International operates in the auto ancillaries sector, which plays a crucial role in India's automotive ecosystem. The company's business spans various automotive components and systems, making it sensitive to broader automotive industry trends and demand patterns.

Investment Implications

Nomura's buy call with a ₹125.00 target price provides investors with an institutional perspective on the stock's potential. Brokerage recommendations often influence investor sentiment and trading activity, particularly when they come from established global firms like Nomura Securities.

The Board of Directors of Samvardhana Motherson International has formally approved the acquisition of Nexans Autoelectric business for an enterprise value of €207 million, marking a significant expansion in the automotive wiring harness segment.

Board Meeting and Regulatory Filing

The board meeting held on December 22, 2025, from 13:15 Hours to 14:30 Hours (IST), approved the acquisition by Motherson Global Investments B.V. (MGI B.V.), an indirect wholly-owned subsidiary of the company. The transaction involves acquiring the business including assets and certain real estate of Nexans autoelectric GmbH and Elektrokontact GmbH, along with shares in their foreign subsidiaries.

Business Profile and Financial Performance

Autoelectric is a 60-year-old global manufacturer of automotive wiring harnesses for light vehicles and commercial vehicles, specializing in both low and high voltage applications. The company reported revenues of €749 million in CY2024, with passenger vehicles contributing 81% and commercial vehicles 19% to total revenues.

Global Operations and Market Presence

The target company operates 22 facilities across 11 countries including Germany, United States, Mexico, China, Tunisia, Ukraine, Romania, Slovakia, Czech Republic, Austria and Switzerland. The business employs over 13,000 people globally, supported by more than 800 engineers.

Strategic Rationale and Regulatory Approvals

The acquisition aims to enhance Motherson's presence with passenger vehicle OEMs globally and provide access to experienced management teams with strong R&D capabilities. The transaction is expected to be cash EPS accretive and synergistic with the company's existing wiring harness division.

Merger control clearance is required from the European Commission and national merger control authorities of Brazil and the United States, along with clearance from the Committee on Foreign Investment in the United States. The transaction is subject to satisfactory completion of all conditions precedent, including regulatory approvals and consultations with the works council.

Transaction Structure and Guarantee Arrangements

Samvardhana Motherson Automotive Systems Group B.V. will act as guarantor in the master framework agreement with respect to the purchaser's obligations. The potential transaction follows entering into exclusive negotiation and signing of a master framework agreement, under which a series of shares and asset purchase agreements will be executed to transfer interests in multiple subsidiaries and assets in Autoelectric.