Nomura sees pause in US reciprocal tariffs to benefit Indian auto ancillary firms

Analysts at Nomura believe the pause in U.S. reciprocal tariffs and escalating trade war between the U.S. and China can benefit Indian auto ancillary companies

This supply chain restructuring can lead to strong gains for players such as Sona BLW SONB.NS, Sansera Engineering SASE.NS, Bharat Forge BFRG.NS and Samvardhana Motherson SAMD.NS - Nomura

The shares climb 4%, 4.8%, 1.4% and 3%, respectively

U.S. President Donald Trump on Wednesday temporarily paused reciprocal tariffs beyond 10% on most countries except China

However, fully built imported autos will continue to have 25% duty while auto parts will be subject to 25% duty from May 3

Brokerage sees lower interest rates, lower income taxes, potential cuts in oil prices to limit the downside risks in the auto ancillary space

Since Trump's announcement of tariffs on April 2, SONB has fallen 12.5%, SASE has lost 14.5%, BFRG down 15.9% and SAMD has declined 14.5%, as of Wednesday's close