Views on M&M 2QFY2016 Results: Angel Broking

Views of Mr. Bharat Gianani (Sr. Research Analyst - Automobile, Angel Broking) on M&M 2QFY2016 Results:

"M&M (MM+MVML) 2QFY2016 numbers were ahead of our estimates on back of better than expected operating performance. Revenues declined 3% YoY to INR 8,794 cr coming slightly better than our estimates of INR 8,490 cr. While the overall volumes have been under pressure declining 10% YoY, the realization per vehicle grew 9% YoY as against our expectations of 3% growth. Automotive segment realisation grew 7% due to better mix (v/s 6% expected), while Farm equipment segment realization grew 14% much higher than our estimates of 6% possibly due to sale of higher horse power tractors. Operating margins at 13.2% improved 100 bp YoY, beating our estimates of 12%. Despite sluggish tractor sales the farm equipment segment EBIT margins at 16.4% expanded by 80 bp YoY coming in ahead of our estimates. Given the robust operating performance, the Net profit at INR 978 cr was ahead of our estimates of INR 907 cr. We currently have NEUTRAL rating on the stock."

Shares of MAHINDRA & MAHINDRA LTD. was last trading in BSE at Rs.1258 as compared to the previous close of Rs. 1260.15. The total number of shares traded during the day was 98151 in over 5527 trades.

The stock hit an intraday high of Rs. 1268.05 and intraday low of 1213.5. The net turnover during the day was Rs. 121684277.

Source : Equity Bulls

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