Buy Mahindra and Mahindra; target of Rs 1250: Emkay Global Financial

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26 Aug, 2025 12:21

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Emkay Global Financial's report on Mahindra and Mahindra

We attended the unveiling ceremony of Scorpio-N, which is targeted at upmarket urban customers. This model is superior to existing Scorpio Classic in terms of power and ridehandling, and sports an all-new design with comprehensive safety/connectivity features. Scorpio-N is developed with an investment of Rs16bn and has a production capacity of 6,000 units per month. It would compete with models like Tata Safari, Toyota Innova, Hyundai Alcazar, etc. Similar to XUV700, it will be launched at a competitive price, which will be applicable to the first 25,000 units. MM’s order book stands at ~170,000 units, and the Scorpio-N launch on July 30 will further support bookings. Considering expectations of a staggered improvement in chip supplies and a large order book, we raise volume estimates by ~3% each for FY23 and FY24. We increase our FY23/FY24 EPS estimates by 6% due to an increase in margin assumptions.

Outlook

We have a Buy rating with a TP of Rs1,250 (Rs1,150 earlier), based on 16x core Jun’24E EPS (DCF-based) and the value of investments at Rs482/share. We increase the valuation multiple to 16x from 14x, factoring in higher revenue growth and margin assumptions in our DCF model.

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At 12:11 hrs Mahindra and Mahindra was quoting at Rs 1,102.30, up Rs 20.25, or 1.87 percent.

It has touched an intraday high of Rs 1,121.00 and an intraday low of Rs 1,079.70.

It was trading with volumes of 171,540 shares, compared to its thirty day average of shares, a decrease of percent.

In the previous trading session, the share closed up 0.93 percent or Rs 10.00 at Rs 1,082.05.

The share touched its 52-week high Rs 1,094.90 and 52-week low Rs 671.00 on 27 June, 2022 and 08 March, 2022, respectively.

Currently, it is trading 0.68 percent below its 52-week high and 64.28 percent above its 52-week low.

Market capitalisation stands at Rs 137,037.11 crore.

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