Samvardhana Motherson International Ltd (SAMIL) is making significant strides in diversifying its portfolio beyond the automotive sector.
The company has reported a fivefold increase in its aerospace business over the past year and is now entering the semiconductor equipment supply chain through a new greenfield project.
Aerospace Division Achieves Tier-1 Status with Airbus
SAMIL’s aerospace division has achieved a notable milestone by becoming a Tier-1 supplier to Airbus. Through its subsidiary, CIM Tools India Pvt. Ltd., the company has secured a multi-year contract to manufacture and deliver components and assemblies directly to Airbus’ final assembly lines. Production will be carried out at Motherson’s specialized aerospace facility in Bengaluru.
Chairman Vivek Chaand Sehgal expressed pride in this achievement, stating,
“We are proud to be recognized as a Tier 1 supplier to Airbus commercial aircraft, and I would like to express my heartfelt gratitude to Airbus for their trust in Motherson. This significant achievement highlights Motherson’s manufacturing capabilities, high-quality standards, and commitment to timely delivery.”
Kunal Bajaj, President of Motherson’s Aerospace Business Division, added,
“This Tier 1 status with Airbus Commercial is expected to drive significant growth in our business with them. This new status reflects our ongoing investments in advanced manufacturing technologies and quality systems to serve our global aerospace customers and their growing production needs.”
Entry into Semiconductor Equipment Supply Chain
Building on its aerospace capabilities, SAMIL is establishing a new greenfield facility to supply components for semiconductor fabrication equipment. This move marks the company’s entry into the semiconductor equipment supply chain, a critical segment in the global chip manufacturing industry.
Deputy CEO Vaman Sehgal commented on this development, saying,
“Building on the capabilities of the aerospace division, we are setting up a new greenfield to supply components for equipment used to manufacture silicon wafers.”
The facility is expected to serve broader demand across semiconductor, electronics, and advanced manufacturing segments over time, leveraging synergies from Motherson’s existing aerospace and industrial verticals.
Strategic Acquisitions Bolster Non-Automotive Growth
SAMIL has been actively pursuing acquisitions to strengthen its non-automotive business. Notably, the company acquired Japan-based high-precision component maker Atsumitec for $57 million, gaining access to global metal and machining capabilities, along with customer diversification and cross-sell opportunities.
Additionally, SAMIL acquired SSCP Aero Topco, the parent company of AD Industries, which manufactures aero engine components and medical devices. This acquisition aligns with SAMIL’s Vision 2025 strategy to diversify into non-auto segments.
The company has also completed four acquisitions in the aerospace business segment, including CIM Tools in 2022 and AD Industries, Cirma, and SMAST in 2023. These strategic moves have expanded SAMIL’s footprint in the aerospace component business, with a presence across all major commercial aircraft platforms and the entire family of LEAP Engines.
Financial Performance and Outlook
SAMIL reported a consolidated net profit of INR 1,372 crore for the January-March period, up from INR 654 crore in the same period last year.
Revenue from operations increased by 20% to INR 27,058 crore. The company expects recent acquisitions to contribute INR 14,500 crore to revenues in FY25, with 18 greenfield sites becoming operational.
Chief Financial Officer Kunal Malani noted that the return on capital employed (RoCE) increased from 11% to 18% in FY24 and sees potential for further growth.
Vision 2025: Diversification and Growth
SAMIL’s Vision 2025 aims to achieve revenues of USD 36 billion with a 40% return on capital employed. The company is focusing on expanding its business in four key non-automotive areas: aerospace, logistics, technology, industrial solutions, and health and medical, targeting a revenue generation accounting for 25% by 2025.
Group Vice-Chairman Laksh Vaaman Sehgal emphasized the importance of diversification, stating,
“The diversification to non-auto segments will help the company leverage the existing business strength of global presence, product design, and development expertise.”
Samvardhana Motherson International Ltd is strategically expanding its footprint beyond the automotive sector, with significant investments in aerospace and semiconductor equipment manufacturing.
Through strategic acquisitions, greenfield projects, and a clear Vision 2025 roadmap, SAMIL is positioning itself as a diversified global entity poised for sustained growth in high-tech industries.
