Samvardhana Motherson, Sona BLW, Bharat Forge: Why auto ancillary stocks are rising today

The rally in stocks could be attributed to the news reports that US President Donald Trump will announce measures to reduce some import duties on parts from abroad that are used in vehicles manufactured in the US.

The formal announcement is expected on Tuesday ahead of a Michigan rally marking Trump's 100 days in office. Trump's flip-flops on tariffs have caused turbulence in financial markets, and, according to foreign media reports, most polls show Americans are concerned about Trump's handling of the economy.

According to a report by NPR (National Public Radio), an American media organisation, the move will ensure that the different types of tariffs charged by the Trump administration don't stack up on imports of foreign cars. The Wall Street Journal first reported the shift on Monday.

Reports say that the importers of foreign auto parts will be able to get some reimbursement from the government for tariffs for the next two years.

This is a positive development for the auto industry.

In the financial year 2024 (FY24), India’s auto component exports reached $21.2 billion, marking a significant turnaround from a $2.5 billion deficit in FY19 to a $300 million surplus, according to a report by Auto World Journal, published on March 4, 2025.

The report further said that by capitalising on emerging electric vehicle (EV) and electronic value chains through increased localisation, India can unlock an additional $15-20 billion in exports. Key components such as battery management systems, telematics units, instrument clusters, and anti-lock braking systems (ABS) are expected to drive this growth.

"With the global auto component trade valued at $1.2 trillion, the US and Europe remain the largest importers. India’s export share in these regions stands at approximately 4.5%, indicating significant potential for expansion," the report added.

Hence, the auto ancillary stocks in India are rising.

As regards Sona BLW, around 66% of the company's revenue is derived from the US and European markets, while Samvardhana Motherson International is one of India's largest auto component manufacturers. Some of its major clients include automotive giants such as Daimler, Volkswagen, BMW, Audi, and Ford.

Other auto component manufacturers with US market exposure, such as Bharat Forge, Sansera Engineering, and Balkrishna Industries.

How shares are performing

At the time of writing this report, Sona BLW Precision Forgings shares were trading 1.39% higher at ₹469.70 apiece on the NSE, while Samvardhana Motherson was trading nearly 1% higher. Bharat Forge shares were trading 0.7% higher at ₹1,125. Balkrishna Industries was trading over half a percent higher at ₹2,591.50 on the NSE.

The benchmark NIFTY50, on the other hand, was trading flat at 24,340.55 levels, up 12.05 points, or 0.05%.