Buy Mahindra and Mahindra Financial Services; target of Rs 380: Axis Capital

Axis Capital is bullish on Mahindra and Mahindra Financial Services has recommended buy rating on the stock with a target price of Rs 380 in its research report dated September 19, 2024.

Broker Research

September 23, 2024 / 12:51 IST

BUY

26 Aug, 2025 12:21

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Axis Capital's research report on Mahindra and Mahindra Financial Services

We expect the growth softness to continue in the near term for MMFS (loan growth to remain weak in Q2), though structural drivers remain intact. As the festive season kicks in, we expect disbursements to pick up in H2. Though margin declined in Q1, it has levers in place to address this. With focus on asset quality, we do not expect any major challenges. Medium-term triggers include likelihood of provision reversal benefitting the earnings, recent approval to enter mortgage business to emerge as a balance sheet driver and room for operating leverage. Tier I at 16.4% is adequate for now, it will look to raise capital in FY26.

Outlook

We raise estimates by 3-6% on better operating leverage and roll-forward to Sept’26E. Raise TP to Rs 380 (2.2x H1FY27E P/ABV) from Rs 350. BUY.

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