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M&M Financial gallops as rights issue opens

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Mahindra & Mahindra Financial Services spurted 4.81% to Rs 135.05 as the company's Rs 3088.82 crore rights issue opened today, 28 July 2020.

Mahindra & Mahindra Financial Services (M&M Finance), a subsidiary of Mahindra & Mahindra, will issue 61,77,64,960 fully paid-up equity shares of face value of Rs 2 each for cash at a price of Rs 50 per equity share aggregating to Rs 30,88,82,48,000 on a rights basis to eligible equity shareholders in the ratio of one equity share for every one fully paid-up equity share held on the record date, that is 23 July 2020. The issue opened today, 28 July 2020, and it will close on 11 August 2020.

The funds raised through the issue will be used to repay/prepay certain outstanding borrowings of the company, augment long term capital and resources for meeting funding requirements for the company's business activities and for general corporate purposes.

On the technical front, the stock's RSI (relative strength index) stood at 57.887. The RSI oscillates between zero and 100. Traditionally, the RSI is considered overbought when above 70 and oversold when below 30.

The stock was trading between its 50-day moving average (DMA) placed at 108.04 and its 200-day moving average (DMA) placed at 162.60.

M&M Finance posted a 298.4% jump in consolidated net profit to Rs 432.12 crore in Q1 June 2020 from Rs 108.46 crore reported in Q1 June 2019. Total income rose 16.1% Y-o-Y (year-on-year) to Rs 3,310.65 crore in Q1 June 2020.

M&M Finance is engaged in providing financing for new and pre-owned auto and utility vehicle, tractors and commercial vehicles. The company also provides housing finance, financing to SMEs and offers fixed deposits. It established a pan-India presence, spanning 27 states and seven union territories through 1,322 offices, as of 31 March 2020.

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(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Tue, July 28 2020. 13:13 IST
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