Synopsis: Motherson Sumi Wiring delivered strong growth ahead of industry, but rising copper costs and ramp-up challenges weighed on margins, with future performance linked to cost stability, EV growth, and capacity utilization.
The shares of this small cap company majorly engaged in manufacturing of wiring harnesses and electrical distribution systems, primarily catering to automotive OEMs, were in focus after revenue increased Q4 FY26 despite rise in copper prices.
With the market capitalization of Rs. 26,129 Crores, the shares of Motherson Sumi Wiring India Ltd were trading at around Rs. 39.4 per share which is 26 percent discount from its 52-week high of Rs. 53.6 per share and is trading at a P/E of 41.9 whereas industry P/E stands at 27.3
Q4 FY26 result
- Year on Year analysis: Revenue from operations has increased from Rs. 2510 Crores to Rs. 3335 Crores, up 32 percent. Operating profit has increased from Rs. 271 Crores to Rs 274 Crores, up 1.1 percent and net profit has increased from Rs. 165 Crores to Rs. 167 Crores, up 1.2 percent.
- Quarter on Quarter analysis: Revenue from operations has increased from Rs. 2887 Crores to Rs. 3335 Crores, up 15.5 percent. Operating profit has increased from Rs. 262 Crores to Rs. 274 Crores, up 4.5 percent and net profit has increased from Rs. 149 Crores to Rs. 167 Crores, up 12 percent.
Margins Impacted Despite Higher Scale
Even with strong revenue growth, profitability remained under pressure. Q4 EBITDA increased only 1.1 percent to Rs. 274 crore (vs Rs. 271 crore), while PAT rose just 1.2 percent to Rs. 167 crore (vs Rs. 165 crore). For FY26, EBITDA grew 6.4 percent to Rs. 1,061 crore (vs Rs. 997 crore), and PAT increased 3.1 percent to Rs. 625 crore (vs Rs. 606 crore). The main reason was the sharp increase in copper prices, which rose around 18 percent QoQ, along with unfavorable currency movement.
Raw Material and Currency Pressures Remain Key Headwinds
Copper prices increased significantly from USD 11,092/MT in Q3FY26 to USD 12,844/MT in Q4FY26. In INR terms, it rose from Rs. 1,067/kg to Rs. 1,259/kg. At the same time, the USD/INR moved from 89.10 to 91.52, and Euro/INR from 103.71 to 107.11. These cost pressures directly affected margins, showing that profitability challenges are largely external.
Investments and Greenfield Ramp-Up Affecting Efficiency
The company has reinvested over Rs. 381 crore in the last two years toward future growth. It operates 30 facilities with over 60,000 employees. However, several greenfield plants are still in the ramp-up stage. Some locations also faced lower or delayed customer volumes, which impacted utilization levels and near-term operating efficiency.
EV and Diversification Supporting Long-Term Growth
The company is building its presence in EV wiring harness, with EVs contributing 8.6 percent of Q4FY26 revenue and 6.6 percent for FY26. Revenue is well diversified across segments passenger vehicles (64 percent ), commercial vehicles (10 percent ), two-wheelers (12 percent ), off-road/agriculture (6 percent ), and others (8 percent ). This reduces dependency on a single segment and supports stable growth.
Outlook: Growth Intact, Margins Linked to Costs and Utilization
Going forward, growth is expected to be supported by ramp-up of greenfield plants and improving customer volumes. EV contribution is likely to rise further as adoption increases. However, margin recovery will depend on stabilization of copper prices and currency movements. As utilization improves, operating leverage can support better profitability.
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