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earnings | IST

Motherson Sumi Q2: Company will announce acquisitions in coming 3-6 months

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Earnings for the second quarter (September-ended) Motherson Sumi Group showed margin contracting, while the management reiterated that supply side challenges will continue in Q3. Vivek Chaand Sehgal, Chairman, told CNBC-TV18, that after having done 27-28 acquisitions, 3 of these during COVID-19, the company will announce many acquisitions in the next 3-6 months.

Motherson Sumi Group will announce many acquisitions in the coming 3-6 months, Vivek Chaand Sehgal, Chairman, told CNBC-TV18.
The manufacturer of automotive wiring harnesses reported earnings for the September-ended quarter with margin contracting and the management reiterating that supply side challenges will continue in Q3.
“We have done 27-28 acquisitions, 3 of which were during COVID-19. However, acquisitions are going to be much more in the coming times. In the coming 3-6 months you will hear of a lot of acquisitions that were pending for some time because of the conditions globally. It’s a very good way to grow and it slows a lot of management problems and things like that,” Sehgal said.
According to him, working capital goes up in the September quarter, but it’s not something to worry about. “Last year September also, the second quarter, in Europe and America there are a lot of holidays in the summers, so the working capital numbers go up normally at that time. So, it's not something out of the ordinary; it's just marginal. But I believe that this thing will work out fine by December. The stress of the balance sheet will not be there. I think it will equal out unless there is some dramatic change here and there."
On the semiconductor issue, he said, “The backlog will continue to happen for another 3-6 months and maybe even further. But the good news is that some of the chip makers have augmented their resources and they are working day and night to try and catch up with demand.”
For the entire management interview, watch the video