M&M mcap crosses Rs 2 trn on back of strong order book in SUV segment

The market capitalisation of Mahindra and Mahindra Ltd crossed Rs 2 lakh crore mark, helped by a strong order book in the SUV segment and leadership position in tractor segment.

M&M shares closed at Rs 1,636.85 on the BSE, giving the firm a market value of Rs 2.03 lakh crore, according to stock exchange data.

The automaker's market cap has doubled in less than one-and-a-half years - from Rs 1 lakh crore in April 2022 to over Rs 2 lakh crore this week. M&M market cap hit Rs 2 lakh crore mark on Monday.

The incremental m-cap in the last two years is more than the incremental market value the firm had over the last decade.

 

Capital allocation actions have led to an overall better financial performance with several non-accretive divestments completed, analysts said adding net cash is at all-time high levels.

Mahindra's auto and farm businesses are industry leaders and it is looking to capitalize on market leadership position. It is No. 1 revenue market share in the SUV segment and has about 50 per cent market share of LCV.

Its dominance in the domestic tractor segment has seen market share rise by about 300 bps in the last two years.

Mahindra's services segment includes industry pioneers like Tech M and Mahindra Finance, which contributed more than 50 per cent of FY23 group earnings.

While Mahindra Finance had the highest-ever disbursements in FY23 (Rs 49,000 crore, up 80 per cent) and much-improved asset quality (4.5 per cent gross NPAs, down from 8.4 per cent), Tech-M is leveraging strength in telecom by being at the forefront of 5G.

The firm, they said, has identified 9 businesses as 'Growth Gems' that will aid a 5x growth over the next several years. The growth engines include Mahindra Lifespaces, Mahindra Holidays and Mahindra Logistics.

Monetization and partnerships with PE firms have helped value discovery, they added.