Nomura Analyzed: Mahindra & Mahindra Stock

Nomura, a large investment firm, strongly believes that Mahindra & Mahindra (M&M) is a good investment. They’ve given the stock a “Buy” rating, calling it their top pick in the business that makes parts for cars (called an OEM). This means Nomura thinks M&M will likely do well compared to other companies in the same industry.

Key Points

• Nomura recommends buying Mahindra & Mahindra stock.
• Target price: ₹4,355 based on a sum-of-the-parts valuation.
• M&M is seen as a leader in electric 7-seater vehicles.
• Sales forecasts: 3,000-4,000 units/month for the XEV 9S.
• SUV volumes expected to grow faster than the industry.
• Key features: LFP battery, lifetime battery warranty.

Nomura came up with this target price by looking at how much the company is worth. They used a method called a “sum-of-the-parts” valuation, which is like adding up the value of each part of the business. Currently, M&M is valued at 13 times its expected profits, but Nomura believes it will be worth 16 times those profits by 2028.

The company is particularly excited about a new electric SUV called the XEV 9S. This SUV is designed to seat seven people and is fully electric. Nomura expects Mahindra to sell 3,000 to 4,000 of these SUVs each month, which is more than they originally thought. They predict sales could even reach 5,000 units a month!

M&M is planning to sell a lot more SUVs in the next few years. They think SUV sales will grow by 18%, 11%, and 7% over the next three years. This means they expect to sell 54,000, 60,000, and 65,000 SUVs each month by 2028. A big part of this growth will come from electric SUVs – they expect to sell 4,400, 7,400, and 7,900 electric SUVs each month.

The XEV 9S is a cool new vehicle with many features. It’s built using a special platform called INGLO and uses a system called MAIA. It’s 4.73 meters long and comes in six different versions. The battery packs can hold 59 kWh, 70 kWh, or 79 kWh of electricity, which means it can drive 521 km, 600 km, or 679 km on a single charge.

Mahindra is offering a long-term warranty on the battery – a lifetime warranty for the first owner and a 10-year warranty for the second owner. The SUV also has a big touchscreen display, a really good sound system, and even extra screens for the back seats. It can charge quickly – up to 80% in just 20 minutes with a powerful charger.

The XEV 9S also has advanced safety features like automatic parking and a special “Boss mode” that lets you control the second-row seats. It uses sensors and cameras to help you drive safely, and it even has a special system called ADAS Level 2+ that can help you with some driving tasks.

“M&M’s strong electric vehicle strategy and growth prospects position it for continued success.”