Buy Mahindra & Mahindra: Equity99

Sumit Bilgaiyan Equity99

Mahindra & Mahindra and MVML's EBIDTA grew 47 percent YoY while margin increased 260bp YoY at 15.8 percent. M&M+MVML's revenue grew 23 percent YoY led by 19 percent YoY growth in tractor volumes; while UV volumes grew 20 percent YoY. EBIT margin in FES segment came in at 20.9 percent while auto segment's EBIT margin came in at 9.4 percent led by improved product mix. Net realisation grew 3 percent YoY at Rs 5,58,100;

M&M+MVML's PAT grew by 64 percent YoY. Management has revised its tractor volume growth upwards at 12-14 percent from 8-10 percent earlier in FY19.

The company plans to launch three new products. Apart from these company also plans to launch an ICV in 5.5-16T segment during festive season.

Post these launches we believe the company will post better volume growth aided by higher realisation. We are recommending a buy for short to long term.