News

Sona BLW share price target cut by analysts citing tariff-related uncertaintiesJefferies has also cut Sona BLW's price target to ₹565 from ₹700, but has maintained its "buy" recommendation on the stock. It said that tariff-driven business pressures in North America and volume slowdowns are key concerns.By Hormaz Fatakia    | Sudarshan Kumar  May 2, 2025, 7:50:29 AM IST (Published)2 Min ReadMost brokerages having coverage on auto components manufacturer Sona BLW Ltd. have cut their price targets by as much as 20%, even as they maintained their positive stance on the stock.

Excluding the PLI benefits, Sona BLW's results for the March quarter were a miss on expectations as its adjusted Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) margin stood at 25.4% from 26.4% last year.

The company has also extended the closing date of completing the acquisition of Escorts Kubota's railways business to June 1, 2025.

Sona BLW's management also said that the US tariffs remain a near-term concerns and 3% of its revenue is at risk due to this.

Brokerage firm CLSA has cut its price target on Sona BLW by nearly 20% to ₹582 from ₹712 earlier. It said that the product mix was impacted as a key EV customer is transitioning to a new model.

CLSA has also lowered its margins expectations for Sona BLW for financial year 2026 and 2027 by 300 basis points due to adverse mix and cost escalation risks. As a results, the Earnings Per Share (EPS) estimates have also been cut by 4% and 6% respectively for the same period.

Jefferies has also cut Sona BLW's price target to ₹565 from ₹700, but has maintained its "buy" recommendation on the stock. It said that tariff-driven business pressures in North America and volume slowdowns are key concerns.

It also said that the India-US trade deal could enhance competitiveness of Indian exporters but due to these uncertainties from tariffs, Jefferies has cut Sona BLW's EPS estimates for FY26-27 by 25%.

The brokerage has maintained that Sona BLW has a strong long-term growth potential with an expanding portfolio.

On the flip side, Citi has increased its price target on Sona BLW to ₹590 from ₹570 earlier. It said that Sona BLW's outlook remains positive despite the concerns surrounding US tariffs, although near-term demand could be volatile.

Even as Citi has increased its price target, it has also cut its earnings estimates for Sona BLW for FY26 and FY27.

Out of the 18 analysts that have coverage on Sona BLW, 12 of them have a "buy" rating on the stock, while three each have a "hold" and "sell" recommendation.

Shares of Sona BLW ended 2.4% lower on Wednesday at ₹480.2. The stock is still down 40% from their record high levels of ₹780.Continue ReadingCheck out our in-depth Market Coverage, Business News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18, CNBC Awaaz and CNBC Bajar Live on-the-go!Tagsshare market todaySona BLWSona BLW Precision Forging