Mahindra & Mahindra Ltd (M&M) is in advanced talks with global investors to raise money in the range of $1 – 1.3 billion by way of selling shares in its electric vehicles (EV) unit. This move is mainly aimed to accelerate the expansion plans of its subsidiary “EV Co”.
Apart from the talks going on, the company, in a filing with the exchange today, announced that the International Finance Corporation (IFC) plans to invest around Rs 600 crores in a new unit of the company “NewCo” which is being incorporated to basically scale up the last-mile electric mobility business. The investment will help M&M to scale up electric three-wheelers and small commercial vehicles (SCVs) that are more affordable.
Mahindra & Mahindra Ltd started its trading session today at Rs 1,167.50 and closed at a price of Rs 1,164. The stock remained flat today with about 0.3 percent upside as compared to the previous closing price of Rs 1,160.30. Having a purview of one year, the stock has been able to deliver a return of around 50 percent to its stakeholders.
The company is one of the most diversified automobile companies in the country along with presence in various segments such as 2-wheelers, 3-wheelers, PVs, CVs, tractors, etc. The group has a presence across 22 industries, and 100+ countries and operates 150+ entities on a consolidated basis.
It is also engaged in the provision of financial services, auto components, hospitality, infrastructure, retail, logistics, steel trading and processing, IT businesses, agri, aerospace, and industrial equipments through its subsidiaries and group companies.
Having a quick walkthrough of the financials of the company, It can be observed that the revenues and net profits have shown an upward trend on a QoQ basis. Revenues moved from Rs 29,870.38 crores in Q2 to Rs 30,620.19 crores in Q3. Moreover, the net profits have shown a movement from Rs 2,585.85 crores in Q2 to Rs 2,602.96 crores in Q3.
Apart from the positive inclination represented by the company, the profitability ratios too show a favorable picture with improving figures YoY. The return generated on the equity capital has shifted from 9.14 percent in FY20-21 to 16.44 percent in FY21-22. In addition to that, the return on the capital been employed has also moved up from 9.46 percent in FY20-21 to 11.92 percent in FY21-22.
The debt to equity ratio of the company has consistently fallen over the past 3 financial years. Mentioning the recent shift from 1.89 in FY20-21 to 1.59 in FY21-22.
As per the quarter ending December 2022, promoters of the company hold a 19.39 percent stake. On the other hand, FIIs have shown faith in the company and increased their stake from 38.27 percent in Q2 to 39.16 percent in Q3.
Written by Amit Madnani
Disclaimer
The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Dailyraven Technologies or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
