Majority of brokerage houses remained positive on auto major Mahindra & Mahindra citing its strong line-up of product launches across segments, network strengthening measures, increased customer engagement, improving rural sentiment, and favourable macro environment. Analysts expect the stock to give up to 17 per cent return in next 12 months. M&M shares have risen 12 per cent in the past one year.
In an analyst meet on March 14, the management has demonstrated its preparedness for BS-VI (2020) with compliant diesel engines to address the potential shift away from diesel. Management expects to regain some of its utility vehicles (UV) glory with the launch of three new models in FY19. The auto comapny is in the process of developing high-voltage EVs, with longer range and higher top speeds.
In the near term, it plans to launch four new models– the S201 compact UV, U321 MPV, New Rexton and new Xylo in FY19F. Of these, two models will likely be launched before November in the volume segment, which should help M&M gain market share in utility vehicles, according to analysts.
“Company’s dominance in tractors and LCVs is likely to continue while it is gaining traction in MHCVs, which should help it achieve Ebitda break-even in FY19,” said Joseph George, analyst, IIFL. “We forecast a strong 18 per cent EPS growth in FY19, after five lackluster years.”