M&M jumps on value buying

Mahindra & Mahindra (M&M) rose 1.29% to Rs 695.05 as the counter witnessed some bit of bargain buying today.

The stock tumbled 6.26% to end at Rs 686.20 on Monday (21 December 2020).

M&M on Monday said its loss-making South Korean arm SsangYong Motor Company (SYMC) has filed for bankruptcy. SYMC has filed an application for the commencement of rehabilitation procedure with the Seoul Bankruptcy Court under the Debtor Rehabilitation and Bankruptcy Act of South Korea, M&M said in a regulatory filing during market hours yesterday

SYMC has also applied for an autonomous restructuring support (ARS) programme which is a court-designed process. If the court approves the ARS, SYMC will continue to function under the supervision of its Board and will negotiate with stakeholders to reach an understanding about a revival package which may include equity and debt financing and other related actions. However, some of its decisions will be subject to court approval.

Last week, M&M had informed that SYMC had missed repayments of loans aggregating to around 60 billion KRW (South Korean won), or Rs 408 crore.

M&M's business is diversified across farm equipment, auto and automotive components, real estate, hospitality, information technology, defence and aerospace and financial services.

The automaker reported 59.7% decline in net profit to Rs 148.36 crore in Q2 FY21 from Rs 368.43 crore in Q2 FY20. Net sales fell 1.5% year-on-year (Y-o-Y) to Rs 23,566.75 crore during the quarter.

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