CIE Automotive prepares a new stage of acquisitions. The Basque manufacturer of automotive components has begun to analyze companies that could join the group starting in 2027, recovering a strategy of inorganic growth that has been one of the constants of the company over the last decades.
According to what has been reported by Cinco Días, CIE has activated since July several due diligence processes to review the accounts and business of potential acquisition targets. The analyses continue during August and the company expects to incorporate new candidate companies during September, although for now their names and the amount that could be allocated to the operations have not been revealed. The goal is to start closing specific investments during the next fiscal year.
The context may play in favor of the company. The automotive sector is going through a complicated stage, especially in Europe and North America, where the weakness of production is increasing pressure on manufacturers and suppliers. For CIE, that scenario can generate buying opportunities at more attractive valuations, as long as it finds companies that fit with its industrial structure and profitability requirements.
Brazil and Mexico, among the main targets for purchase
The strategy does not involve growing in the same way in all markets. According to Cinco Días, CIE is fundamentally looking for component manufacturers present in markets with growth potential, such as Brazil and Mexico, or companies that have global projects with large multinational automotive companies.
Brazil has a growing weight within the group. CIE has 16 factories there, while vehicle production in the country increased by more than 10% during the first half. The Brazilian market represents approximately 12% of the group's sales and 13% of its EBITDA, so an acquisition would allow for an increase in a presence that is already significant. The main risk lies in the financial environment of the country, with high interest rates and a significant portion of car purchases dependent on credit.
In Mexico, CIE has a dozen plants and has been reinforcing capacity for several years. It has inaugurated a factory and is building another near the U.S. border, with investments close to 100 million dollars per installation. This location allows for production close to customers and supplies the U.S. market, reducing some of the logistical and commercial risks.
India will grow, but through its own factories
The exception is India. There, CIE currently does not consider acquisitions attractive because, according to published information, the owners of potential target companies would be demanding valuations that are too high. The company has opted to grow organically, building new plants instead of buying competitors.
CIE already has 23 factories in India, a country that accounts for 16.8% of its sales and approximately 18% of EBITDA. Indian automotive production increased by around 14% during the first half of the year, supported by the launch of new models, more contained inflation, and the growth of exports.
The difference summarizes the group's strategy: buy where it finds reasonable valuations and build from scratch when the price of an acquisition does not compensate.
CIE approaches purchases with record profit and contained debt
One of the factors that allows CIE to consider new operations is its financial situation. The company closed the first half of 2026 with 2,103.8 million euros in revenue, an EBITDA of 401.1 million, and a record net profit of 191.3 million, according to its official results. The EBITDA margin stood at 19.1%.
Additionally, it generated more than 275 million euros in operating cash up to June. Net financial debt was at 962.4 million, equivalent to approximately 1.19 times EBITDA, a relatively contained level for an industrial group that aims to grow again through acquisitions.
Management had already made this intention clear in May. The CEO, Jesús María Herrera, explained during the shareholders' meeting that financial strength would allow for maintaining growth, increasing shareholder remuneration, and "integrating new companies" within the roadmap for 2026 and 2027.
The last major purchase was Aludec, specialized in decorative parts for automotive, acquired at the end of 2025 for about 200 million euros. CIE financed that operation with cash and its own resources and claims to have completed its integration during the first half of the year.
What can drive up CIE's shares
The new acquisitions can become a stock market catalyst, but not necessarily just because of the act of buying. The market will value above all which company CIE acquires, how much it pays, and what return it expects to obtain from the operation.
A purchase in Brazil or Mexico that allows for increased sales, improved margins, or securing global contracts with manufacturers could be received positively. It would also be favorable if CIE managed to take advantage of the weakness of other suppliers to acquire assets at reduced prices without excessively increasing its debt.
Operational results currently provide another support. In the first half, CIE's sales grew by 9.3% despite vehicle production in the markets where it operates falling by around 1%, according to Bankinter. The bank also highlights the group's ability to maintain margins close to 19% in a very challenging scenario for the automotive industry.
Bankinter maintains a recommendation to buy and a target price of 36.60 euros per share, which in its analysis on August 14 represented a potential close to 43%. The entity highlights as strong points geographical diversification, low debt, and that around 80% of the components manufactured by CIE are compatible with both electric and combustion vehicles. This valuation belongs to Bankinter and does not constitute a guarantee regarding the future evolution of the share price.
The price of purchases can also work against
The risk lies precisely in the execution. An acquisition can pressure the shares if CIE pays too much, significantly increases its debt, or takes longer than expected to integrate the acquired company. There is also the risk of acquiring industrial capacity at a time when global vehicle production remains weak.
The share price itself reflects that uncertainty. CIE closed on Friday, August 28, at around 25.50 euros, very close to the lower end of its range over the last 52 weeks, which is situated between approximately 25.05 and 33 euros.
The evolution of the business in China and North America will be another element to watch. Bankinter points out that these are the two regions where CIE grew below their respective markets during the first half, although the company maintains a relatively low exposure to China and predominantly produces close to its customers, which reduces some tariff risks.
2027 will be the key year for new expansion
Analysts expect CIE to end 2026 with more than 4 billion euros in sales and an EBITDA exceeding 780 million, figures that would reinforce its capacity to finance growth.
But the main novelty for the coming months will be outside the ordinary income statement. The company is reviewing possible targets, will expand those analyses in September, and intends to return to the acquisition market starting in 2027.
For shareholders, the keys will be in the size of the operations, their financing, and the profitability they can bring. Brazil and Mexico appear as the clearest destinations for growth through acquisitions, India will continue to advance with new own factories, and CIE will try to take advantage of the sector crisis to strengthen itself without losing one of the characteristics that the market currently values the most: its financial discipline.