Samvardhana Motherson International Ltd

- Samvardhana Motherson International Limited has obtained in-principle approval to raise up to INR 5,000 crores through Non-Convertible Debentures (NCDs). - This approval is regulatory and indicates flexibility; the actual size and timing of any debt issuance will depend on business needs. - Previously, the company had an approval for INR 3,000 crores and issued INR 1,500 crores. - The company has not specified exact plans yet but may use the funds for acquisitions or capex. - The company maintains a disciplined financial approach, with leverage improved to 1.4x and cash/liquidity of around INR 15,000 crores as of March 31, 2024. - Overall, the company is prepared and financially positioned to pursue growth opportunities through both organic investments and M&A, supporting the INR 5,000 crores debt-raising as a strategic option rather than an urgent need.

- The company plans to invest approximately INR5,000 crores in capex for FY'25, with a variance of ±10%. - Around INR2,000 crores of this capex is earmarked for new Greenfield projects. - 70% of the Greenfield capex will focus on nonautomotive segments. - They are setting up 18 Greenfield plants, including 6 new ones announced recently (13 in India, 4 in China, and 1 in Poland). - Investments target emerging markets and new business segments, including consumer electronics and aerospace. - The Consumer Electronics division is a new area of investment, built upon a joint venture (details under confidentiality). - Capex projects typically take 6-18 months to ramp up. - The company emphasizes disciplined capital usage, focusing on profitability and ROCE while pursuing strategic inorganic acquisitions aligned with customer needs.

- Company targets $36 billion revenue in the 5-year Vision 2025 plan; currently at $24 billion with $12 billion still to achieve. - Strong growth in India with record car production expected to continue through the year. - Emerging markets are driving volume growth; European and North American volumes still 10-15% lower than pre-COVID levels. - Continued acquisitions (18 closed recently) expected to contribute incremental revenue (~INR14,500 crores annually). - New Greenfield plants (18 announced) with INR2,000 crores capex planned for FY'25 to support growth; 70% of capex targeted at non-automotive sectors. - Focus on premiumization, SUVs, and diversified powertrain-agnostic portfolio to capture industry trends. - Growth in Emerging Businesses segment has reached ~$1 billion revenue with high profitability. - Company emphasizes stability and selective opportunistic M&A to maintain leverage and profitability while driving long-term growth.

- The company expects to continue growing its revenue, with Vision 2025 targeting $36 billion; currently at $24 billion with runway to grow further (Page 14). - EBITDA margin improvements are focused on, especially in Modules and Polymer business, with sustained margin expansion efforts (Page 11). - ROCE improved significantly to 17% in FY'24 from 11% in FY'23, with expectations for continued improvement in profitability and capital efficiency (Page 5 & 9). - The company anticipates stable macroeconomic conditions will support better performance and margin expansion (Page 11). - With strong customer trust and ongoing acquisitions, integration is expected to drive improved earnings from acquired entities (Page 14). - The company remains disciplined on leverage and profitability while aggressively investing in Greenfield plants and inorganic growth (Pages 5 & 14). - Earnings growth is supported by operational efficiencies, cost pass-through mechanisms (e.g., copper prices), and growth in emerging markets (Pages 9 & 4).

- Automotive booked business stands at nearly USD 84 billion as of FY'24, up from USD 77 billion in September 2023. - This figure excludes the recent acquisition of Yachiyo; nonautomotive booked business will add further. - The strong orderbook reflects long-term visibility and customer trust. - Customers frequently call with opportunities, indicating a healthy pipeline. - Management emphasized confidence in crossing targets due to strong customer relationships and acquisition management (though some acquisitions are yet to be fully integrated). - The company is actively managing acquisitions and Greenfield projects, including 18 Greenfields with 6 newly announced across India, China, and Poland. - The strategy includes a diversified customer and country mix (3CX10 strategy) to mitigate regional risks and capitalize on opportunities.