M&M hits record, rises 4% in 2 days on Q3; Nomura, Macquarie up targets

The M&M share price has jumped 4.36 per cent in 2 days, including today's gain, on the back of strong Q3 results and outlook

M&M share price: Automobile giant Mahindra and Mahindra (M&M) share price rose as much as 2.45 per cent to hit a record high (all-time high) of Rs 3,276.30 per share, on Monday, February 10, 2025.

 

The M&M share price has jumped about 4.36 per cent in 2 days, including today’s gain, on the back of strong Q3 results and outlook. 

 

However, at 11:46 AM, the M&M share were off record highs and were trading 0.55 per cent higher at Rs 3,215.25 a piece. 

 

M&M Q3 performance

 

M&M consolidated profit attributable to the owners of the company surged 19.6 per cent to Rs 3,180.5 crore in Q3FY25, from Rs 2,658.4 crore in Q3FY24. Its revenue climbed 17.5 per cent year-on-year (Y-o-Y) to Rs 41,470 crore in Q3FY25, from Rs 35,299.4 crore a year ago. At the operating level, Ebitda zoomed 32.2 per cent Y-o-Y to Rs 8,230.7 crore in Q3FY25, from Rs 6,224 crore a year ago. Subsequently, Ebitda margin expanded to 230bps 19.9 per cent, as against 17.6 per cent in the same quarter last year.

 

The company’s standalone profit after tax (PAT) rose 19.1 per cent Y-o-Y to Rs 2,964.3 crore in Q3FY25, from Rs 2,489.7 crore in Q3FY24. The revenue soared 20.3 per cent Y-o-Y to Rs 30,963.8 crore, from Rs 25,736.7 crore in Q3FY24. Ebitda rose 31.8 per cent Y-o-Y to Rs 4,809.8 crore in Q3FY25, from Rs 3,648.9 crore in Q3FY24. 

 

M&M quarterly volumes surged 16 per cent Y-o-Y to 2,45,000 units, while utility vehicles (UV) volumes stood at 1,42,000 units. 

 

In the farm segment, the company recorded its highest ever Q3 market share at 44.2 per cent, with volumes surging 20 per cent Y-o-Y to 1,21,000 units.

 

Anish Shah, managing director & CEO of M&M said, “Our businesses continue to demonstrate strength in execution. Auto and Farm delivered solid performance on market share and margins, on the back of focused execution.”

 

Analysts' view

 

According to analysts at Nomura, M&M’s SUV CAGR at 14 per cent over FY25-27F is expected to outperform the industry. The Income tax cuts are anticipated to benefit the higher segments. 

 

The initial response to BEVs has been positive, and analysts at Nomura foresee potential upside to our sales estimates of 3,000/7,000 units per month over FY26-27F. EV bookings are set to begin on February 14. 

 

With further growth in tractor demand and market share, analysts have revised their FY25F growth estimates to 10 per cent Y-o-Y (from 7 per cent earlier). 

 

While EVs may drag earnings in the short-term, analysts stressed upon the long-term importance of EV success.

 

Thus, analysts at Nomura have largely maintained their FY25-27F revenue estimates and slightly raised their tractor volume projections. The brokerage has increased the target price to Rs 3,681, from Rs 3,664, and maintained its ‘Buy’ rating.

 

Those at JM Financial noted that the company has raised its FY25 domestic tractor industry volume growth guidance to 7 per cent+ (from ~6 per cent earlier). Rural sentiment remains positive, driven by higher reservoir levels and an increase in MSP. 

 

In the auto segment, the gradual addition of SUV capacity and new launches are expected to drive volume growth. The ramp-up of recently added capacity and higher operating leverage are expected to support margin performance. 

 

Given the strong execution in autos and a healthy outlook for the farm segment, JM Financial maintained a ‘Buy’ rating with a target price of Rs 3,625. The success of upcoming EV and ICE launches, analysts believe, remains a key monitorable.

 

According to reports, Macquarie has maintained ‘Buy’, and raised the target to Rs 3,643. Goldman Sachs, too, maintained its ‘Buy’ rating and raised the target to Rs 3,800. 

 

Meanwhile, Jefferies reportedly has maintained ‘Buy’ with a target of Rs 4,075, CLSA maintained ‘Outperform’ with a target of Rs 3,510, and UBS maintained its ‘Neutral’ rating with a target price of Rs 3,460.