M&M extends gains on brokerage upgrade

Mahindra & Mahindra rose 2.25% to Rs 1,336.95 at 14:26 IST on BSE, extending gains triggered by the news of brokerage upgrade.

Meanwhile, the S&P BSE Sensex was up 101.26 points or 0.34% at 30,044.50.

On the BSE, 1.86 lakh shares were traded on the counter so far as against the average daily volumes of 1.68 lakh shares in the past one quarter. The stock had hit a high of Rs 1,345 and a low of Rs 1,315.55 so far during the day.

The stock had hit a record high of Rs 1,508.80 on 9 August 2016 and a 52-week low of Rs 1,141.80 on 2 December 2016. It had outperformed the market over the past one month till 25 April 2017, advancing 2.48% compared with the Sensex's 1.77% rise. The scrip had, however, underperformed the market over the past one quarter, gaining 5.19% as against the Sensex's 8.07% rise.

The large-cap company has equity capital of Rs 310.55 crore. Face value per share is Rs 5.

Shares of Mahindra & Mahindra (M&M) have risen 5.73% in two trading sessions from its closing of Rs 1,264.45 on 24 April 2017 in the aftermath of media reports that a foreign brokerage has upgraded the stock to outperform from neutral with increased target price. The stock had risen 3.4% to settle at Rs 1,307.50 yesterday, 25 April 2017.

As per reports, the brokerage has upgraded the M&M stock to outperform from neutral with increased target price at Rs 1,500 from Rs 1,390 earlier. The brokerage house cited potential for M&M's tractor business that will surprise positively going ahead.

Reports suggested that the brokerage believes with number of state governments planning to introduce farm loan waivers, tractor demand could get further boost. The brokerage added that weakness in utility vehicle market already factored in by M&M.

M&M announced that Mahindra Overseas Investment Company (Mauritius) (MOICML), a wholly owned subsidiary of the company, has acquired 100% of the equity share capital of Mahindra Automotive North America Inc. (MANA) in USA.

In view of this, MANA has become a wholly owned subsidiary of MOICML and in turn, of the company with effect from 25 April 2017. The announcement was made after market hours yesterday, 25 April 2017.

M&M's net profit rose 33.3% to Rs 1112.27 crore on 0.3% decline in net sales to Rs 10860.05 crore in Q3 December 2016 over Q3 December 2015.

M&M enjoys a leadership position in tractors and utility vehicles in India.

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