Motherson Sumi’s overseas operations portrayed a dip in margins due to start-up costs and raw material cost increases. Although the Street had factored a small decline in Ebitda (earnings before interest, tax, depreciation and amortization), at 9.7% it came in 102 basis points lower than a year ago. Ebit (earnings before interest and tax) margins at the European subsidiary, Samvardhana Motherson Peguform (SMP), dropped 50 basis points lower at 4.4%. At a consolidated level, they jumped by 39% in absolute terms and by 100 basis points as a percentage to sales. With margins under pressure, Motherson Sumi’s stock valuation has started to erode.

Source: Mint May 25, 2018 03:22 UTC