Samvardhana Motherson’s shares rise 4% as the company addresses fears of a 25% tariff on car imports

Samvardhana Motherson International Ltd shares gained 3.8% to an intraday high of Rs 137 on the BSE on Friday, as the auto accessory firm attempted to ease investor concerns following a share price drop due to Donald Trump’s planned 25% tax on foreign automobile imports. Samvardhana Motherson International Ltd has tried to reassure investors after its stock price fell 2.22% to Rs 132 on March 27. The dip occurred amid larger losses in the auto and auto component industries, with other equities, including Tata Motors and Sona BLW Precision Forgings, falling up to 7%. The drop in shares is due to market concerns that prospective tariff increases, particularly Donald Trump’s planned 25% tax on foreign vehicle imports, might disrupt global supply chains. 

CLSA stays favorable, expects 23% upside:

Despite worries about tariffs and market volatility, CLSA has maintained a ‘outperform’ rating on SAMIL, with a target price of Rs 167, representing a 23% increase from current levels. The brokerage expects the company’s revenue to increase at an 11% compound annual growth rate (CAGR) between FY25 and FY27, hitting $16 billion in FY27. CLSA also expects EBITDA margins of 9.5% throughout this time.

SAMIL’s stock has fallen over 35% in the last six months owing to macroeconomic worries, tariff threats, and a value downgrade. Analysts believe that the company’s localized manufacturing model and USMCA compliance will better insulate it from tariff-induced interruptions than competitors who rely significantly on exports. SAMIL, a member of the Motherson Group, has 400 sites in 44 countries and generates more than 95% of its income from three key divisions: wiring harness, vision systems and modules, and polymer products.

Among the 25 analysts that cover the stock, 21 recommend ‘buy’, two recommend ‘hold’, and two recommend’sell.’ While macroeconomic concerns and uncertainty regarding US trade policy exist, analysts remain bullish about SAMIL’s strategic positioning through localized manufacturing and USMCA compliance, which might provide it an advantage over competitors more vulnerable to export-related risks. While market fears about Donald Trump’s proposed tariffs loom, SAMIL’s diverse operations and local manufacturing strategy look to place it ahead of many of its auto component competitors.