Indian auto parts maker Motherson to launch $715 million share sale, sources say

Samvardhana Motherson International

04/09/2024 08:15

By Aditi Shah and Aditya Kalra
       NEW DELHI, Sept 4 (Reuters) - One of India's largest
makers of auto parts, Samvardhana Motherson International
 SAMD.NS , will launch a share sale of up to $715 million this
month, two sources briefed on the matter told Reuters, the
latest company to tap a booming stock market.
    The fund-raising exercise stands to be one of India's
biggest this year, data from Dealogic shows, lagging only
$1-billion share sales by Vedanta and Adani Energy in recent
months. 
    With a market capitalisation of about $15 billion, Motherson
 supplies parts to domestic and global automakers such as Maruti
Suzuki  MRTI.NS  and Mercedes-Benz  MBGn.DE .
    Motherson's roadshows for the fund-raising exercise are
"finding support from investors," said one of the two sources,
who sought anonymity as the planning process is confidential.
    The exercise is expected to be completed by month-end, the
sources said, adding that the company plans to use the funds
raised to repay debt, fund some expansion and certain capital
expenditure.
    Motherson did not respond to a request for comment. 
    The funds will be raised through a so-called Qualified
Institutional Placement (QIP), which listed Indian companies use
to raise funds from large institutions. 
    Motherson reported revenues of $11.75 billion and operating
profit of more than $1 billion in the fiscal year that ended in
March. Its net debt at the end of June stood at $1.58 billion. 
    Axis Bank  AXBK.NS , HSBC  HSBA.L , Jefferies  JEF.N , JM
Financial  JMSH.NS  and Morgan Stanley  MS.N  are advising the
company on the share sale.
    Jefferies declined to comment, while the other four did not
respond to Reuters' requests for comment.
    Motherson says it is among the world's largest suppliers of
auto parts and also counts Tata Motors  TAMO.NS , Volkswagen
 VOWG_p.DE , Ford Motor  F.N  and Porsche  PSHG_p.DE  among its
clients.
    Listed on the stock exchanges in 1993, the company also
supplies parts to the aerospace, consumer goods and health and
medical industries. It has acquired 45 companies in India and
globally over the past two decades.
    India's stock market is on a hot streak, with the benchmark
index  .NSEI  up 16% this year, outdoing Asian peers.

 (Reporting by Aditi Shah and Aditya Kalra; Editing by Clarence
Fernandez)
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