Motherson Q4 FY26 Results Analysis: Margin Expands 197 bps, EBITDA Surges 42%
CompoundingAI Research
Updated May 21, 2026
2 min read
Positive
MOTHERSON's Q4 FY26 numbers came in strong, with revenue of Rs. 34,309.31 Cr (+17.00% YoY) and PAT growth of +40.00% YoY. Here's a quick read of what worked, what to watch, and what management said.
Quick Details| Results date | May 20, 2026 |
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| Quarter | Q4 FY 2025-2026 |
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| Revenue (Q4) | Rs. 34,309.31 Cr (+17.00% YoY) |
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| PAT (Q4) | Rs. 1,561.56 Cr (+40.00% YoY) |
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| EBITDA margin | 11.09% (+197 bps YoY) |
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| EPS (Q4) | Rs. 1.42 (+42.50% YoY) |
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| Market cap | Rs. 144,559.22 Cr |
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| CMP | Rs. 137.10 |
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Quarter Snapshot
Motherson delivered strong Q4 with 17% YoY revenue growth and 197 bps margin expansion, beating its net leverage target of 0.9x with actual 0.70x. Operating leverage visible as EBITDA grew 42% while costs grew only 14.3%. Working capital improved significantly and FCF generation was strong at Rs.4,955 crore. Key inflections confirmed in Integrated Assemblies (+490 bps margin) and Modules & Polymer (+270 bps) showing European transformation benefits. Headwinds include commodity cost pressure (+26.8% YoY) and elevated exceptional items.
Key Investment Insights
Key Positives
- Revenue grew 17% YoY to Rs.34,309 crore in Q4, with Q4 sequential acceleration of 9.2% QoQ
- EBITDA margin expanded 197 bps YoY to 11.09%, with Q4 margin at 11.1% vs 9.1% in Q4 FY25
- Net leverage improved to 0.70x vs target of 0.9x — exceeded guidance by 22%
- Working capital improved: net outflow Rs.945 crore vs Rs.2,078 crore outflow in FY25
- Integrated Assemblies margin improved 490 bps YoY to 15.5% — strongest margin improvement
- Modules & Polymer margin improved 270 bps YoY to 9.2% — European transformation benefits visible
- Free cash flow generation strong at Rs.4,955 crore vs Rs.1,725 crore in FY25
- Order book of $87.2 billion provides strong revenue visibility for FY27
Risk Factors
- Cost of materials consumed grew 26.8% YoY, outpacing revenue growth — commodity price pressure
- Exceptional expenses of Rs.413.53 crore for restructuring and labor code provisions
- Effective tax rate increased to 27.4% from 21.2% in FY25 due to higher profitability in Europe
- Net profit margin declined to 3.2% FY26 from 3.5% FY25 (normalized for exceptionals)
- Wiring Harness margin declined 100 bps YoY to 11.4% due to North America CV market cyclicality
- FX impact negative: unrealized forex loss Rs.345.97 crore vs gain Rs.467.36 crore in FY25
Disclaimer: This is an AI-generated analysis based on public filings. It is not investment advice, not a recommendation to buy/sell/hold any security, and is not prepared by a SEBI-registered Research Analyst or Investment Adviser.
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