M&M Shares Surge Up 4% After Q3 — Brokerages See Further Upside

Mahindra & Mahindra share price surged up over 4% to hit an intraday high of ₹1,723.70 on Thursday.

What Happened: The company’s standalone net profit, soared by 60% year-on-year to reach ₹2,454 crore, as compared to ₹1,528.06 crore reported in the same period last year. The robust performance was primarily driven by the automotive segment’s strong showing, coupled with a favourable product mix and benefits from operating leverage.

The company’s revenue for the December quarter quarter witnessed a 16% YoY growth, reaching ₹25,642.4 crore. This growth was predominantly fueled by robust volume expansion in the automotive segment.

EBITDA for the quarter came in at ₹3,590.3 crore compared to ₹3,273 crore reported in Q3FY23. EBITDA margin was at 14%.

The auto giant’s sale volumes grew by 11.1%, totalling 3.13 lakh units. Auto sales surged by 20.1% year-on-year, reaching 2.11 lakh units, while tractor volumes experienced a marginal decline of 4% from the previous year, amounting to around 1 lakh units during the last quarter.

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Analyst Reactions: Most brokerages were impressed by the company’s results and remained positive on the stock. Citi maintained its “buy” rating for the stock raising the price target to ₹1,890 from ₹1,750. The analyst said that the company’s December quarter results were steady and added that they expect the auto sales to grow by 11%-12% over FY24-FY26.

Bernstein also maintained its “outperform” rating for the stock with a price target of ₹1,880. The brokerage firm highlighted that the company’s margins continued to improve on a quarterly basis thanks to a favourable mix.

Motilal Oswal also maintained its “buy” call on the stock with a target price of ₹2,005. The domestic brokerage said that the demand outlook for the year ending March 2025 looks positive.

Nuvama also reiterated its “buy” call on the stock raising the price target to ₹2,080 from ₹2,010. The brokerage firm said that the EV segment is a key focus area of the company and a big catalyst for the stock.

Kotak Securities maintained its “add” rating for the stock with a price target of ₹1,800. The domestic brokerage firm said that the company’s standalone EBITDA was in line with its estimates and the automotive division performance was strong during the quarter.

Price Action: Mahindra & Mahindra’s share price was up 3.93% to trade at ₹1,722.15 shortly after markets opened on Thursday.

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