Company Update - Mahindra & Mahindra

We attended the virtual analyst meet hosted by M&M wherein the company provided a business update on notably three domains: (i) Update on potential investor coming on board of SsangYong Motors and potential financial implication for M&M (equity & debt exposure) (ii) amicable calling off of JV with Ford Motors (announced in October 2019) and (iii) supply side constraints (semi-conductor chips) impacting volumes in the near term.

Valuation & Outlook

M&M is a conglomerate with varied business interest. However, the company has now commenced its path on RoE accretion as it realises that healthy capital efficiency is paramount for long term self-sustenance of its business model as well as to create wealth for its shareholders. In the recent past, M&M has taken the hard calls and we remain constructive on it. We continue to maintain BUY rating on M&M with an unchanged target price of Rs. 870 valuing it using SOTP valuation methodology.

For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_MahindraMahindra_CoUpdate_Jan21.pdf

Shares of MAHINDRA & MAHINDRA LTD. was last trading in BSE at Rs.748.9 as compared to the previous close of Rs. 732.9. The total number of shares traded during the day was 295113 in over 7711 trades.

The stock hit an intraday high of Rs. 750.5 and intraday low of 727.35. The net turnover during the day was Rs. 218292879.

Source : Equity Bulls

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