Accumulate M&M: Motilal Oswal Securities

Accumulate Mahindra and Mahindra (M&M), says Rajat Rajgharia, Head of Research at Motilal Oswal Securities.

Rajgharia told CNBC-TV18, "The two-wheelers will continue to face challenges in the short-term also and we think that when the domestic industry itself is facing shifts in market share from one play to another the sector multiple itself contracts, which is what we have seen at least in case of Hero Motocorp. For Bajaj Auto, of course export at Rs 55 is surely helping them to cover up for the weak domestic performance but overall the sector is moving towards lower multiple."
He further added, "On the four-wheelers, Tata Motors did a fair bit of outperformance. It was the best performing Sensex name last year. Maruti Suzuki has started doing well now and probably should continue that performance."
"Mahindra and Mahindra somewhere got impacted by some of these macro headwinds more particularly relating to diesel price increases etc that happened. I think from a stock point of view if you look at M&M, the big drive in the consolidated earnings over a three year period can almost double the numbers from FY12 to FY15. We are looking at almost Rs 90-100 kind of earnings per share (EPS) for FY15 for M&M and the stock at Rs 880-900 just trades very attractive but maybe these are the best times for investors to accumulate this name because each of the pieces are doing well for M&M."