M&M - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 19 Sept 25, 2:16 pm

Fundamental Rating: 4.6

📊 Core Financials Overview

Profit Growth: PAT rose from ₹2,954 Cr to ₹3,564 Cr — a solid 36.4% increase, reflecting strong operational performance.

Return Metrics

ROCE: 27.0% — excellent capital efficiency.

ROE: 20.8% — strong shareholder value creation.

Debt Profile: Debt-to-equity of 0.03 — virtually debt-free, enhancing financial resilience.

Cash Flow: While not explicitly stated, high profitability and low debt imply robust operating cash flows.

💹 Valuation Indicators

Metric Value Interpretation

P/E Ratio 34.0 Slightly below industry average (41.2) — fair valuation for a market leader.

P/B Ratio ~7.36 High, but justified by strong ROE and brand premium.

PEG Ratio 0.99 Fairly valued relative to growth — neither cheap nor expensive.

EPS ₹102 Strong earnings base supports valuation.

🧠 Business Model & Competitive Advantage

Mahindra & Mahindra (M&M) is a diversified conglomerate with leadership in

Automotive: Dominant in SUVs and commercial vehicles. New launches like Thar Roxx and XUV 3XO are driving growth

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Farm Equipment: Market leader in tractors, with volume growth expected to continue

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Electric Vehicles (EVs): Aggressive push into EVs with models like XEV 9e and BE 6 — over ₹8,472 Cr in bookings on launch day

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Diversification: Presence in aerospace, defense, construction equipment, and renewable energy — reduces cyclicality

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Global Reach: Operations span across 100+ countries, with exports contributing to revenue stability.

Its competitive edge lies in brand strength, product innovation, and strategic expansion into EVs and farm tech, positioning it for long-term growth.

📈 Technical & Sentiment Signals

RSI: 63.7 — approaching overbought, but not extreme.

MACD: Strongly positive — bullish momentum.

Volume: Slightly above average — healthy investor interest.

DMA 50/200: Price above both — confirms long-term uptrend.

🎯 Entry Zone & Long-Term Guidance

Suggested Entry Zone: ₹3,300–₹3,450 — near DMA levels and below recent highs.

Long-Term View: M&M is a high-quality, diversified play on India’s auto, farm, and EV growth. With strong fundamentals, low debt, and innovation-led expansion, it’s well-suited for long-term holding. Dividend yield of 0.69% adds modest income stability.

Let me know if you'd like a side-by-side comparison with Tata Motors or Maruti Suzuki to sharpen your view.

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www.businesstoday.in

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auto.economictimes.indiatimes.com

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simplywall.st

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