Shares of Mahindra and Mahindra (M&M) surged 3% to ₹3,008 on June 18, reaching a new 52-week high after the international brokerage Nomura increased its target price for the stock.
Key Points:
- Nomura analysts maintained a ‘buy’ recommendation, raising the target price to ₹3,374, which is 15.1% higher than the last close on the NSE. The previous target was ₹2,818.
- Nomura expects M&M to continue its strong growth across various segments. They believe the company’s farm business, despite underperforming in FY24, has significant potential.
- In the fourth quarter of the fiscal year, M&M’s tractor sales dropped by 20% year-on-year to 71,000 units, and its market share fell by 130 basis points to 39.4%.
Positive Outlook:
- Nomura is optimistic about M&M’s electric vehicle segment, suggesting it could lead in the premium market. They also see growth potential in M&M’s export business.
- Recently, M&M’s market capitalisation briefly surpassed Tata Motors, making it India’s second most valuable automobile company, according to Bloomberg.
Future Plans:
- During M&M’s Investor Day presentation, the company announced plans to launch six new SUVs by 2030, along with a total of 23 new models by the same year. They also plan to introduce seven electric vehicles by the end of the decade.
Current Trading:
- At around 10:38 am, M&M shares were trading at ₹2,986.9, up 2.05% from the last close on the NSE. M&M shares have gained 70% since the start of the year, making it the best-performing stock on the Nifty index.
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