Emkay Global Financial has given Buy recommendation for Mahindra and Mahindra with a target price of Rs. 1055 in its research report issued on Nov 09, 2021

Emkay Global Financial’s report on Mahindra and Mahindra

Q2FY22 EBITDA declined 19% yoy to Rs16.6bn, slightly above estimates. Revenue grew 15% to Rs133.1bn, above our estimate of Rs124.6bn, mainly aided by better realizations in the Auto segment. Adjusted earnings grew 29% to Rs16.9bn, 13% above estimates, owing to higher other income. The PV order book is strong at 160,000+ units, led by robust demand for XUV700 and Thar models. New products remain a focus area across segments, with an emphasis on EVs. By CY27, management expects to launch 16 electric models for PVs, CVs and 3Ws. We expect revenue/earnings CAGRs of 12%/14% over FY22-24E. Auto revenue should see a strong 18% CAGR, while Farm equipment revenues are likely to witness a subdued 2% CAGR.


The core P/E ratio is inexpensive at 12.5x/10.5x on FY23/24 estimates. Recommend Buy with a TP of Rs1,055 (Rs920 earlier), based on 14x core P/E on Dec’23E (Sep’23E earlier) and the value of investments at Rs537/share (Rs435 earlier).

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