The IIFL Securities Report: Buy Samvrdhna Mthrsn Intl - June 06

IIFL Securities has recommended a buy call for Samvrdhna Mthrsn Intl, setting a target price of Rs 156. The current market price of the stock is Rs 150.5, indicating a potential upside of 3.6%. This recommendation is based on the company's strong financial performance, growing market share, and favorable industry outlook. Samvrdhna Mthrsn Intl is a leading provider of maternal and child care products in India, with a wide distribution network and a strong brand presence.

About Samvrdhna Mthrsn Intl:

Samvrdhana Motherson International Limited (SAMIL) is a leading global automotive component supplier headquartered in Noida, India. It operates in 41 countries with over 130 manufacturing facilities. SAMIL manufactures a wide range of products, including automotive wiring harnesses, rearview mirrors, interior and exterior plastic parts, automotive lighting, and electrical and electronic systems. It supplies to major automobile manufacturers such as Toyota, Volkswagen, and General Motors. SAMIL is a joint venture between Motherson Sumi Systems, an Indian auto component supplier, and Samvardhana Motherson Group, a global automotive supplier.

52 Week Price Trend:

Samvardhana Motherson International Limited's current market price stands at Rs 150.5, well above its 52-week high of Rs 123.45 but within a significant range from its 52-week low of Rs 61.8. This indicates a strong recovery from its lows and a potential for further upside, as the price has breached its previous resistance level. However, investors should exercise caution and monitor market conditions before making any significant investment decisions.

Stratzy's MOST Analysis:

Based on Stratzy's MOST framework, MOTHERSON has been rated BBB, indicating medium fundamental risks. This rating considers factors such as management expertise, business outlook, financial safety, and market trend analysis. The scoring system assigns weights to each pillar, with the overall rating reflecting the cumulative assessment. A BBB rating suggests that MOTHERSON exhibits a balanced risk profile with moderate management efficiency, a stable business outlook, adequate financial stability, and a positive market trend.

Company's Fundamentals:

Samvrdhna Mthrsn Intl (NSE: MOTHERSON) shares trade at a price-to-earnings (PE) ratio of 48.69, indicating that investors are willing to pay 48.69 times the company's annual earnings per share for its stock. The price-to-book (PB) ratio of 3.47 suggests that the market value of the company's assets is 3.47 times its book value, indicating a premium valuation. Despite a relatively low dividend yield of 0.56%, the company's financial performance and growth potential may justify the higher PE and PB ratios.

Fundamental and Technical information provided in this blog were last updated on 06 Jun, 2024

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