Brokerages bullish on M&M shares after bagging 30,000 bookings for newly launched eSUVs; stock cracks 5%

Citi Research and Nomura Holdings maintained their 'buy' call on M&M.

Shares of Mahindra group firm M&M Ltd. sank five percent despite the auto player seeing an overwhelming response for its new electric SUVs, the XEV 9e and BE 6.

Mahindra & Mahindra's newly launched electric sports utility vehicles have received a significant response, recording 30,179 bookings on the first day. The total booking value stands at Rs 8,472 crore (ex-showroom price).

At 9.30 am, M&M shares were quoting Rs 2,797.45 on the NSE, lower by 4.9 percent compared to the previous close. The auto player's stock was the top loser on the Nifty 50 index.

The split between the XEV 9e and BE 6 is 56 per cent and 44 per cent respectively, Mahindra & Mahindra said in an official statement. The two models are priced between Rs 18.9 lakh and Rs 30.5 lakh (ex-showroom).

The company said that the strong demand underscores the confidence customers have in Mahindra’s Unlimit India vision—delivering innovative, world-class electric SUVs that offer a distinctive blend of luxury, performance, and technology.

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International brokerages Citi Research and Nomura Holdings reiterated their bullish bets on the auto firm.

Citi noted that the deliveries will begin in late March, in a phased schedule. Given that the firm's capacity is at 5,000 units per month, M&M's orderbook stands at around six months. The brokerage said it remains to be watched how the EV facility ramps up and what the cancellation rate for the cars is.

Nomura Holdings said the number of bookings marks an impressive start for BEVs (battery electric vehicles), especially since 73 percent of the bookings have come for the top-end 79 kwh Pack Three. The price points for these EVs is very high, as India's EV market is still in a nascent stage.

Both the brokerages maintained their buy call, with Nomura reiterating a price target of Rs 3,681 per share, while Citi Research's target for M&M shares was at Rs 3,680 per share.

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