Motherson Sumi jumped over 3% on record date of allotment

Motherson Sumi Systems shares jumped over 3% to Rs 190 on the BSE in early trading on Monday, the record date being today. On Friday, the company began trading ex-DWH business ahead of its record date, with DWH planning to be listed independently by March 2022.

Motherson Sumi Systems was trading 2.32% higher at Rs 189.85 at 11:35 a.m., compared to a 0.10% increase in the S&P BSE Sensex.

Also Read| Metro Brands share jumps 20% on reporting strong Q3 results

For the quarter ended 30-Sep-2021, Motherson Sumi Systems Ltd. reported consolidated sales of Rs 14163.53 crore, down 5.66% from the same quarter a year ago. The company reported 35.76% YoY de-growth in net profit at Rs 216.86 crore for the latest quarter.

Also Read| HDFC Bank slides over 1% despite 18% rise in Q3 profit

“The outlook for the auto ancillaries sector is very bullish amid a push to EV theme and PLI scheme where Motherson Sumi is a prominent player. The demerged entity of domestic wiring harness is expected to list in March with an expected price between Rs. 75-80,” said Santosh Meena, Head of Research, Swastika Investmart Ltd.

Also Read| Hero MotoCorp share jumps nearly 5% on announcing investment in Ather Energy

After the de-merger of the DWH business and merging with the parent firm, SAMIL will be the new name for the currently listed entity. The merger with the promoter company is scheduled to take place on January 24th. Subject to regulatory clearances, MSWIL’s listing is planned for mid-March.

Also Read| HCL Tech share dips nearly 6% after reporting lower earnings in Q3 results

“Samvardhan Motherson Sumi International Limited (SAMIL) is currently trading around Rs 190 level and I think the 190-180 zone will act as an immediate and strong demand zone for this counter while on the upside 210-220 is a resistance area, above this, we can expect fresh bullish momentum,” added Meena.

Also Read| Trending Stocks: HDFC, HCL, Vedanta, PB Fintech, CESC and others in news today

“The proposed restructuring exercise creates a platform for future growth through inorganic and organic routes. This restructuring exercise is a step toward the company’s Vision 2025 – revenue target of $36bn with ROCE of 40%,” said brokerage house Emkay in a note on January 10. It has a Buy rating on the stock with a target price of Rs 300.