M&M share price: The share price of Mahindra and Mahindra (M&M) rose about 4 percent in a weak market a day after (Tuesday) the automaker launched “the bid daddy of SUVs,” the All-New Scorpio-N. For now, M&M has only announced prices for manual transmission variants starting at Rs 11.99 lakh and up to Rs 19.49 lakh. Prices for the automatic and four-wheel drive variants will be announced on July 21, per release. The company is unveiling the new product simultaneously in South Africa and Nepal. And it plans to introduce this vehicle in Australia and New Zealand soon.
M&M stock price history
On Tuesday, the scrip hit a record high of Rs 1,121 on BSE. It has risen in the past four days and is up 14 percent over the period.
A pair of analysts said M&M could be a major beneficiary of the strong commercial vehicle (UV) model cycle as they set price targets for the stock as high as Rs 1,315, suggesting a potential upside of 17 percent on the counter.
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Nomura said the all-new Scorpio-N is another potential winner and could add a 10-15 percent increase to total volumes in the commercial vehicle space during FY23-24.
The market share of M&Ms for commercial vehicles has improved, rising to 17 percent in May 2022, from 13-14 percent in FY21-22.
Emkay Global said the July 30 launch of the Scorpio-N would further support bookings. Taking into account expectations of a steady improvement in chip inventories and a large order book, it has increased volume estimates for M&M by 3 percent for FY23 and FY24. This brokerage has increased its EPS estimates for FY23/FY24 by 6 percent as a result of higher margin assumptions.
“We have a buy recommendation with a target of Rs 1,250, compared to Rs 1,150 previously, based on 16 times the core June 2024 EPS (based on DCF) and the value of investments at Rs 482 per share. We are increasing the valuation multiple from 14 to 16 times, taking into account higher revenue growth and margin assumptions in our DCF model,” said Emkay.
ICICIdirect said in a note that M&M is steadily transforming with a pipeline of exciting launches in electric PV and LCV amid a change in the technology landscape in the automotive space.
M&M plans to unveil its native electric strategy on Aug. 15, it said, maintaining its positive view of automaker amid healthy demand prospects in its product profile, focused on capital efficiency and EV proactiveness. The brokerage has a target of Rs 1,315 on the stock.
Ravi Singh of Share India said that the popularity of SUVs among customers and the advanced features of Scorpio N at a competitive price, the global launch could prove to be a game-changer in the SUV market. He said that the script is already starting to get excited and that it could reach the level of Rs 1,250 soon.
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