Mahindra & Mahindra Shares Soar 3% After Q1 Results: Buy, Hold, Sell?

Mahindra & Mahindra (M&M) stock soared by over 3% early Monday, reaching ₹1,517.10 per share on the BSE, after surpassing Q1 forecasts.

Mahindra & Mahindra Q1 Performance: The company’s Q1 net profit nearly doubled from last year’s same quarter, landing at ₹2,773.73 crore. Revenues surged 23% to ₹24,368 crore and EBITDA increased by 46.5% to ₹3,547 crore, boosting the EBITDA margin from 12.2% to 14.6%.

The automotive branch of M&M also noted a rise in EBIT margin from 5.3% to 7.5%. Moreover, Anish Shah, M&M’s CEO, stated their recent acquisition of a 3.53% stake in RBL Bank for ₹417 crore is a long-term move, and they may consider a stake increase to 9.9% if strategic value presents itself.

What do analysts say? HDFC Securities held a ‘Buy’ rating and raised the target price to ₹1,674 per share, citing better-than-expected margins and a strong backlog of orders for UVs.

Motilal Oswal Financial Services maintained its ‘Buy’ rating and raised its target price to ₹1,725 per share, expecting a Compound Annual Growth Rate (CAGR) of 14% revenue, 20% EBITDA, and 20% PAT from FY23-25.

Meanwhile, Nuvama Institutional Equities maintained a ‘Buy’ call, setting a 12-month target price of ₹1,790 per share, encouraged by M&M’s robust growth in the auto segment and moderate growth in the farm segment.

Price Action: Mahindra and Mahindra Ltd. shares were trading 3.23% higher at ₹1,511.65.

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