Motilal Oswal's research report on Mahindra and Mahindra
We have categorized Mahindra and Mahindra (MM)’s core businesses into three buckets: Tractor, Pickup UV, and Passenger UV. All of these businesses witnessed a sharp growth in their underlying industries, resulting in record-high volumes in FY23. While the industry dynamics remained favorable for MM, its focus on- i) new model launches, ii) healthy margin expansion in the core business, and iii) prudent capital allocation resulted in an earnings CAGR of ~11% over FY19-23. This coupled with expected launches in the EV category led a substantial re-rating. As a result, MM has outperformed the Nifty index significantly over the last two years with ~44% CAGR visà-vis 12% for the Nifty. While we believe that growth should moderate in some of its verticals, MM is still better placed to outperform the underlying segments, which would result in ~12.5%/15%/17% revenue/EBITDA/ PAT CAGR over FY23-26E.
Outlook
The implied core P/E for MM stands at 18.1x/16.4x FY24E/FY25E EPS, which remains attractive vs. peers. Hence, we reiterate our BUY rating with a TP of INR2,005 based on Dec’25E SOTP and INR214/share for its ePV subsidiary.
For all recommendations report, click here
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
Find the best of Al News in one place, specially curated for you every weekend.
Stay on top of the latest tech trends and biggest startup news.