Samvardhana Motherson shares rally 4% as company issues clarification following Trump's 25% auto tariff; check what it says

In its clarification, the company said that a significant part of the products supplied by the company and/or its subsidiaries to its various customers in the US are either manufactured in the US or are United States-Mexico-Canada Agreement (“USMCA”) compliant, and therefore, as per its present assessment, the said executive orders may not have any material impact on the financials of the company.

However, impact (if any) going forward depends on various inclusion(s) / exclusion(s) of product(s), component(s), territory(ies), tariff(s), etc., forming part of said Executive Orders, as may be notified or amended, it added.

On Thursday, shares of the company, along with other companies in the automotive sector, took a heavy beating following Trump's announcement. The leading auto equipment manufacturer derives 20% of its revenue from the US, which is also the second largest revenue contributor to the company, followed by Germany, China, and Spain.

Samvardhana shares ended 2.22% lower at ₹132 apiece on the BSE.

Samvardhana Q3 FY25 Results

The company reported a consolidated net profit of ₹879 crore for the third quarter ended December 31, 2024. The figure stood at ₹542 crore in the corresponding quarter of the previous fiscal year.

According to analysts, the profit was smaller than expected due to weak global car sales.

Samvardhana Motherson is India's leading auto parts maker by market capitalisation. Some of its customers include Maruti Suzuki, Mercedes-Benz, Volkswagen, Audi, and BMW.

Global car sales were down about 1% during the December quarter, the company said. The company added that its profitability was also hurt by a decline in margins at its top modules and polymers business to 8% from 8.8%.

The company earns about half of its revenue from parts like bumpers and the rest from wiring harnesses, rearview mirrors, sunroofs, and door and dashboard panels.

Samvardhana Motherson stock performance

Shares of Samvardhana Motherson have rallied over 12% in the past year but have declined over 15% on a year-to-date (YTD) basis.