Forvia SE

Bank of America double upgraded Forvia to Buy from Underperform and raised its price objective to €14 from €10.50, sending shares of the French auto parts supplier up more than 8% Wednesday. Analyst Stephen Benhamou said the concerns raised at the bank's initiation "now appear largely priced in." The upgrade followed Forvia's announcement a day earlier of a seating joint venture with India's Anand Group, in which Forvia will hold 50% plus one share and Gabriel India, Anand's flagship listed company, will hold 50% less one share; the venture aims to help Forvia reach about 10% market share in India over five years. Benhamou noted Forvia is the worst-performing European supplier this year, down about 30%, trading at a roughly 10% discount to peers with a free cash flow yield above 20%. He said the planned €1.82 billion sale of the Interiors business exposes a valuation gap, with the remaining business trading at 6.4 times 2027 estimated EV/EBIT versus 7.2 times for European suppliers, and that convergence with peers would imply about 60% upside. BofA expects savings of about €110 million in 2026 and €120 million in 2027 to lift the adjusted EBIT margin to 7.0% by 2028 from 6.2% in 2026, while leverage falls to 1.2 times from 1.6 times, with its 2028 estimates about 5% above consensus.

Forvia and Anand Group have signed a joint venture agreement to accelerate seating growth in India, creating a new entity named Faurecia Anand Seating India Private Limited that will focus on seat frames and complete seats. Forvia will control the venture with a 50% plus 1 share stake, while Gabriel India, Anand Group's flagship company listed on the National Stock Exchange and Bombay Stock Exchange, will hold 50% less 1 share. The partnership combines Forvia's global seating expertise with Anand Group's local manufacturing footprint and customer relationships to strengthen access to Indian OEMs, supporting Forvia Seating's ambition to reach approximately 10% market share over the next five years as a first growth milestone. The transaction is expected to close by the end of 2026, subject to customary conditions including applicable regulatory approvals. The joint venture builds on a relationship between the two companies that began in 1991 with a partnership in Clean Mobility.

FORVIA has signed a mandate with an investment services provider to buy back up to 1,000,000 of its own shares between September 3 and September 18, 2026, as part of the buyback program approved by shareholders on June 4, 2026. The repurchased shares will be used to hedge commitments under performance share plans or other long-term incentive plans for employees and corporate officers. The program details are in the 2025 Universal Registration Document filed with the French markets regulator on March 13, 2026. FORVIA, a global automotive technology supplier with over 137,500 employees and 2025 revenue of 26.2 billion euros, is listed on Euronext Paris under the ticker FRVIA.

Forvia SE reported first-half 2026 results with sales of EUR10.5 billion, down 4.3% versus H1 2025, and an operating margin of 6.0%, up 30 basis points year-over-year. Net income reached breakeven at EUR3 million, a significant improvement from a loss of EUR269 million in the prior year. Net cash flow rose 18% to EUR432 million, and net debt was reduced by EUR503 million to EUR5.5 billion, marking the strongest semester of organic debt reduction since the HELLA acquisition. Order intake surged 15% to EUR13.4 billion, with a book-to-bill ratio of 1.5 times. The Interiors divestiture to Apollo is on track for Q4 2026, with all major regulatory approvals secured and expected to generate over EUR1 billion in additional net debt reduction. The company expects H2 profitability to be at least as good as H1, despite a challenging market environment and one-off cash outflows of approximately EUR150 million.

FORVIA reported first-half 2026 results with operating margin expanding 30 basis points to 6.0% and net cash flow rising 18% to €432 million, while confirming its full-year guidance. Sales declined 4.3% to €10,509 million, with organic growth at constant exchange rates down 1.9%, outperforming automotive production in all regions except China, where sales fell 20.1% to €1,804 million and underperformed local production by 14 percentage points. The Growth cluster posted an operating margin of 6.1% of sales, up 20 basis points, while the Value cluster margin improved 60 basis points to 6.0% of sales. Order intake reached €13.4 billion excluding Interiors, and the planned divestiture of the Interiors business to Apollo is expected to close in the fourth quarter of 2026.

FORVIA has signed an agreement with General Dynamics European Land Systems for the transfer of its Augsburg site in Germany, securing approximately 300 jobs. The transaction, subject to regulatory approvals and employee consultation, includes a joint nine-month upskilling plan to support new defense activities while leveraging existing automotive manufacturing expertise. FORVIA says the move ensures continuity for customers and aligns with the first phase of its IGNITE plan to focus activities and strengthen competitiveness.