Samvardhana Motherson International Ltd Q4 FY26 Earnings Call: Order Book Crosses USD 96 Billion, Electronics Revenue Grows 7.5x

Samvardhana Motherson International Ltd held its Q4 FY26 earnings call on May 20, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.

Record Quarterly Revenue, Margin Expansion & Profit Growth

• Rs.1.25 lakh crore— FY 2025-2026 annual revenue crossed this milestone, growing11%YoY, with Q4 FY26 revenue up17%YoY to an all-time quarterly high.
• 42% EBITDA growth— Q4 FY26 EBITDA rose 42% YoY, with margins expanding200 bpsYoY; full-year FY26 EBITDA margin held resilient at9.5%despite commodity inflation.
• 66% normalized PAT growth— Q4 FY26 normalized PAT grew 66% YoY; full-year FY26 normalized PAT rose17%YoY.
• Rs.177 crore exceptional— Reported PAT for Q4 FY26 included Rs.177 crore (post-tax) for business transformative measures in Central and Western Europe; full-year FY26 reported PAT included Rs.328 crore (post-tax) for those measures, Rs.25 crore for new labour code impact, and Rs.45 crore for accelerated amortisation.
• ROCE moderated to 16.1%— FY26 ROCE declined from 17.2% in FY25 due to record capex; management expects progressive improvement toward the Vision 2030 aspiration of40%.

USD 96 Billion Booked Business Provides Multi-Year Visibility

• USD 96 billion— all-time high booked business at FY26-end, providing strong growth visibility;22%from EV programmes and3%from non-automotive.
• USD 1.6 billion aerospace order book— record level, up from USD 1.2 billion, covering a5–8 yearhorizon but expected to be front-ended on strong Indian demand; current aerospace revenue ~USD 250 million (Rs.2,400 crore in FY26).
• ~USD 1.4 billion consumer electronics order book— derived from total order book of USD 3 billion less aerospace USD 1.6 billion, with execution largely expected byFY 2027-2028.
• USD 22.9 billion gross revenue— FY26 gross revenue at constant exchange rate (INR 84.55/USD); FY25 restated at USD 21.2 billion for comparability under Vision 2030 reporting.
• No CE customers appear in the top-20 customer list— management noted they are "not permitted to name certain customers" and these are classified under "others".

Electronics Scales 7.5x, Aerospace 40% Growth, Wiring Harness Margins Expand

• Consumer electronics revenue ~7.5x YoY— in FY 2025-2026, with Q4 FY26 revenue up46%sequentially; the business achieved full-year EBITDA profitability; GF3 (size of 33 football fields) on track for commissioning inQ3 FY 2026-2027.
• "Meaningful multiples of growth" guided for FY27— electronics division driven by Rs.2,600 crore capex, new JVs, and bringing SMT lines in-house; the consolidated JV for consumer electronics is already EBITDA positive.
• Aerospace revenue +40% YoY— in FY 2025-2026 (approx. 10x over three years); order book increased >20% to USD 1.6 billion; two new aerospace facilities in India coming online inQ1 FY 2026-2027.
• Wiring harness: 170 bps QoQ margin expansion— in Q4 FY 2025-2026, driven by operational improvements and recovery in underperforming global entities (PKC, Stoneridge),despite copper price headwinds(copper up ~16% QoQ, ~38% YoY in Q4).
• Integrated assembly (M-SAS): 2x new programme launches— FY 2026-2027 is a critical year with double the launches versus FY26; management refrained from specific numeric guidance as revenue depends on customer vehicle sales volumes.
• Precision metal & modules: 2.7x growth in FY26— driven largely by the Atsumi-tech acquisition; management highlighted machining and precision machining as a core focus area with potential expansion beyond automotive.

Cost Pass-Through Dynamics, European Restructuring, and Input Cost Headwinds

• Copper impact lagged, recovery expected in FY27— copper prices rose ~16% sequentially and ~38% YoY in Q4 FY26; management expects recovery in "coming quarters" (FY 2026-2027) through pass-through arrangements with OEM customers.
• European restructuring largely complete— but further opportunities remain due to ongoing macro challenges in Europe; future acquisitions may need resizing to drive volume growth.
• Cost pass-through is customer-dependent— a mix of contractual and negotiated arrangements exists for overheads, energy, and polymers; some lag is inherent but strong partnerships help in volatile times.
• Input cost inflation for a few weeks in Q4 FY26— energy, gas, and freight costs rose but were not significant for Motherson; CFO Gandharv noted most industries incurred these costs inQ1 FY 2026-2027.
• No EV supplier compensation received— management clarified Motherson did not receive any compensation related to customer EV writedowns in FY26; the company was never on the "EV-only train" and is contractually bound only to supply per agreements.

Record Capex, Deleveraged Balance Sheet, and Disciplined M&A Pipeline

• Rs.5,911 crore capex in FY26— representing49%of yearly EBITDA; FY 2026-2027 capex guided at ~Rs.6,000 crore (±10%), split 50% growth and 50% maintenance.
• Consumer electronics capex ~Rs.2,600 crore in FY26— similar range expected for FY 2026-2027 (final numbers to be disclosed in Q1 FY27).
• Net leverage at all-time low of 0.8x— well below internal aspiration of 1.5x and financial policy ceiling of 2.5x; management expects to reduce further in FY 2026-2027 through positive cash flow.
• 16 facilities under development globally— all in emerging markets, with13scheduled to come on stream duringFY 2026-2027; four new facilities announced post-last update (two wiring harness, two logistics).
• Yutaka Giken acquisition on track for H1 FY27— Nexans automotive harness deal expected to close by end June/early July 2026 (Q1 FY 2026-2027), subject to regulatory approvals.
• Final dividend Rs.0.25 per share— taking total FY26 dividend to Rs.0.60 per share, payout ratio of16.4%(up ~1% from FY25); Vision 2030 aspiration of up to40%payout.
• M&A pipeline "quite high"— Chairman V.C. Sehgal confirmed a disciplined approach: opportunities evaluated at customers' behest, "looking at meaningful opportunities" to drive progress toward the "108" target and Vision 2030.

USD 108 Billion Ambition, European OEM Launches, and Macro Risk Monitoring

• Vision 2030: USD 108 billion gross revenue target— management reiterated the group's seventh five-year plan target, implying a47% CAGRover four years, while emphasising financial discipline:"top line is vanity, bottom line is sanity, cash in the bank is reality".
• European OEM launches in FY27 to support auto growth— despite a weak industry production outlook, management expects support from a leaner footprint, new content-rich vehicles (especially EVs), and new local production in Europe.
• Passenger vehicle industry grew ~2% globally in FY26— commercial vehicle developed markets grew an estimated5.4%in FY26, and management remains constructive on the CV outlook for FY 2026-2027.
• External risks being monitored— geopolitical tensions in the Middle East (crude-linked inflationary pressures), polymer price increases in Germany, global freight and container cost increases; pass-through arrangements and local manufacturing mitigate impact.
• Business diversification provides resilience— management highlighted that different segments (consumer electronics, medical devices, automotive, aerospace) have varying order-to-execution cycles (1 year for electronics, up to 10 years for aerospace), offering protection during "severe macroeconomic turmoil."
• Management declined to comment on Apple-related risk— when asked about a "big change" at a potential customer, management stated they cannot discuss customer-specific questions.