M&MFIN - Fundamental Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Fundamental Rating: 3.6

Let’s break down M&M Financial Services into its key components to assess investment suitability

📊 Core Financials

Profitability

ROE (10.9%) and ROCE (8.77%) are modest — signals average capital efficiency.

EPS of ₹16.5 on current price (₹252) gives a reasonable earnings yield.

Quarterly Performance

PAT rose from ₹456 Cr. to ₹528 Cr. — stable sequential growth.

Profit Variation (6.21%) — suggests moderate momentum but not breakaway growth.

Leverage

Debt-to-equity at 5.53 — very high; typical for NBFCs, but adds risk in rising interest rate environments.

Dividend Yield of 2.58% — attractive for income-focused investors.

📈 Valuation Metrics

Indicator Value Insight

Stock P/E 15.3 Low compared to industry P/E (25.2) — undervalued

P/B Ratio ~1.63 Fair for a financial services player

PEG Ratio 0.58 Indicates attractive pricing vs growth

Intrinsic Value Likely higher than current price Supported by improving earnings and strong brand lineage

🧭 Business Model & Competitive Advantage

M&MFIN serves rural and semi-urban financing segments — vehicle loans, personal loans, and SME finance.

Strong parentage (Mahindra Group) supports brand trust and distribution reach.

Exposure to rural India creates potential upside during farm-led cycles but also increases credit quality volatility.

📉 Technical Overview

RSI: 37.1 — near oversold zone, technical setup could favor bounce.

MACD: -3.47 — bearish crossover; near-term weakness in momentum.

Current Price below DMA50 & DMA200 — stock is consolidating or under pressure.

🛒 Entry Zone & Long-Term Holding Guidance

Suggested Entry Zone: ₹240–₹250 range — near support and RSI bounce levels.

Holding View: Suitable for medium- to long-term investment if you're comfortable with NBFC cyclicality. Focused rural portfolio, strong dividend yield, and undervalued metrics make it a decent candidate with moderate upside potential.

Want to see how it compares with other financial names like Shriram Finance or Bajaj Finance in terms of growth and risk profile? I can run that for you next.

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