In December 2023, Motherson reported net sales of Rs 25,697.56 crore, marking a 27.05% increase from Rs 20,226.22 crore in December 2022. The quarterly net profit for December 2023 was Rs 541.96 crore, showing a 19.4% rise from Rs 453.92 crore in December 2022. EBITDA (earnings before interest, tax, depreciation, and amortization) reached Rs 2,424.30 crore in December 2023, a 42.82% increase from Rs 1,697.41 crore in December 2022.
Motherson’s earnings per share (EPS) rose to Rs 0.80 in December 2023 from Rs 0.67 in December 2022. On February 20, 2024, Motherson shares closed at Rs 113.50 on the NSE, providing a return of 18.60% over the last 6 months and 38.50% over the last 12 months.
Samvardhana Motherson Unit Raises Rs 2,922 Crore Through Senior Notes
Samvardhana Motherson International Ltd.'s subsidiary raised $350 million through U.S. dollar-denominated notes, marking its return to the bond market after eight years.
Samvardhana Motherson International Ltd. has successfully raised $350 million through its subsidiary, marking its return to the U.S. dollar bond market after eight years. This move reflects the company’s strategic efforts to optimize its debt structure and leverage strong investor interest.
Successful Fundraising by SMRC Automotive Holdings
A subsidiary of Samvardhana Motherson International Ltd. has raised $350 million through the allotment of U.S. dollar-denominated senior, secured, and guaranteed notes, the Noida-based maker of automotive harnesses and rearview mirrors announced in an exchange filing on Thursday. The notes, issued by SMRC Automotive Holdings Netherlands B.V., a step-down subsidiary of the company, have a five-year tenure and will be listed on the Frankfurt Stock Exchange. The company has undertaken guarantee obligations over the notes, ensuring investor confidence and security.
The issuance was met with strong interest from the investor community, enabling the company to price the notes tightly at a coupon rate of 5.625%. This reflects not only the market’s confidence in Samvardhana Motherson’s financial stability but also the company’s ability to attract capital at competitive rates. The company’s decision to undertake guarantee obligations over the notes further reinforced investor confidence, ensuring a successful fundraising round.
Strategic Use of Proceeds
The notes were issued at tight pricing with a coupon rate of 5.625%, reflecting strong interest from investors. The issuance is debt-neutral, with the proceeds earmarked to repay existing debt, thereby optimizing the company’s financial structure. This strategic move underscores Samvardhana Motherson’s commitment to maintaining a robust balance sheet and enhancing financial flexibility. The company highlighted that this fundraising marks its return to the U.S. dollar bond market after an eight-year hiatus, signifying its renewed focus on global financial markets.
Conclusion
Samvardhana Motherson’s successful $350 million fundraising through its subsidiary highlights its strategic financial management and investor confidence. By leveraging favorable market conditions and strong investor interest, the company is poised to strengthen its financial position and continue its growth trajectory.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.