So, like, I went to this analyst meet thing for Mahindra & Mahindra, right? It was all about their big acquisition of SML Isuzu. Apparently, M&M bought like 59% of SML Isuzu from Sumitomo Corporation and Isuzu Motors for ₹550 crore in cash. And get this, they’re planning to make an open offer for another 26% stake. That’s a lot of moolah, man.
The whole point of this acquisition is for M&M to beef up their presence in the +3.5 ton commercial vehicle market. Right now, they only have like 3% market share, which is peanuts compared to the 52% they have in the under-3.5 ton category. With this move, they’re hoping to double their share to 6% right away, and then shoot for 10–12% by FY31 and over 20% by FY36. Ambitious much?
On top of trying to dominate the market, M&M is also expecting to save some dough by joining forces with SML Isuzu. They think they can cut costs, improve their network, share platforms, and boost their brand. Sounds like a win-win, right? But here’s the kicker – the financial impact of all this is pretty small. Like, less than 2% increase in revenue and only about 1% more in EBITDA/PAT. Not exactly a game-changer, if you ask me.
And just to add some more spice to the mix, the whole deal is supposed to be wrapped up by December 2025. So, mark your calendars, folks.
Now, when it comes to M&M’s future in the passenger vehicle industry, things are looking a bit murky. The demand for PVs isn’t exactly booming right now, and M&M’s new SUV lineup has already hit the streets. So, yeah, not really sure why this matters, but there you go.
Despite the somewhat questionable outlook, M&M is still all about that value-accretive capital allocation. They’re all about unlocking synergies and whatnot. But hey, guess what? The financial impact of all this synergy unlocking is, you guessed it, pretty darn small. Like, 2% more revenue and 1% extra in EBITDA/PAT. Not exactly mind-blowing stuff.
But hey, what do I know? I’m just a fresh-faced journalist trying to make sense of all this biz jargon. So, take it all with a grain of salt, folks.
In conclusion, we’re sticking with our Add rating for M&M, and our target price remains at ₹2,700. So, yeah, that’s the scoop on M&M’s big move. Stay tuned for more exciting updates in the world of finance. Peace out.