Automobile major Mahindra & Mahindra’s share price surged 5 per cent to a high of Rs 3,283.80 on the National Stock Exchange. The surge in the stock came after the company reported its earnings for the second quarter of the current financial year. The brokerage house remained positive on the stock as earnings were in line with expectations.
Goldman Sachs on Mahindra & Mahindra
The global brokerage house maintained a ‘Buy’ rating on the stock and raised its target price on M&M to Rs 3,850 from Rs 3,700. The brokerage said that the results came in line, with core revenue being 1 per cent above and EBIT 2 per cent below house estimate.
Its SUV growth seen at mid to high teens in H2FY27 during long wait periods. The company’s FY27 tractor outlook cut to flat from 5 per cent growth, along expected lines.
Tractor guidance implies about 10 per cent of volume decline in H2FY27. The company’s management sees better margin visibility as input costs are moderate. Car dealer inventory is below normal, and tractor inventory is near normal.
Elara Capital on Mahindra & Mahindra
The brokerage reiterated a ‘Buy’ rating. The brokerage cuts its target price to Rs 4,130 from Rs 4,578. The company’s standalone EBITDA margin of 11.7 per cent, down 290 basis points YoY on commodity inflation.
The company’s management maintains FY27 SUV growth guidance at mid-to-high teens. Its FY27 tractor industry outlook cut to flattish from about 5 per cent earlier. Farm EBIT margin contracted 176 basis points QoQ to 16.8 per cent on weaker tractor volumes.
Elara Capitla expects SUV and EV capacity to rise to 82,000 units a month by Q4FY27.
The FY27-29 expected core EPS cut by up to 4 per cent. The brokerage said that the company’s valuations are seen attractive at about 19x FY28 core EPS.
Mahindra & Mahindra share price performance
The share price of Mahindra & Mahindra has risen more than 13 per cent in the last five trading sessions. The stock has surged 14 per cent in the past one month. However, Mahindra & Mahindra’s share price has dropped 10 per cent over the previous 12 months.
Sparsh Bansal is the Chief Copy Editor with ET Now Digital. He writes extensively on equity markets, IPO, with a passion for financial markets and a sharp eye to detect patterns, I extensively cover IPOs, stock movements, and investment strategies that shape India’s economic landscape.
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