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M&M: Robust Results, EBIT margins improve across Auto and Farm Segments

ICICIdirect Research 07 Feb 2025 DISCLAIMER

On standalone basis, top-line for Q3FY25 came in at ₹30,538 crore (up 21% YoY) with automotive segment volumes growing 16% YoY at 2.45 lakh units and tractor volume at 1.2 lakh units (up 20% YoY).

EBITDA in Q3FY25 came in at ₹4,468 crore with corresponding EBITDA margins at 14.6% (up 30 bps QoQ). Resultant PAT for Q3FY25 stood at ₹2,964 crore (up 21% YoY).

Automotive segment EBIT margins improved ~20bps QoQ at 9.7% on a QoQ basis, while Farm Equipment segment margins were at 18.1% (up 60 bps QoQ).

M&M leads the SUV segment with a revenue market share of 23% in Q3FY25.

M&M also retains its market leadership in tractor space with market share as of Q3FY25 end pegged at 44%, up 240 bps QoQ.

It is aiming to launch 23 new vehicle models by 2030. Recently it has launched its new EV models in the PV space i.e. BE 6 and XEV 9E and will start their booking from 14th Feb, 2025.

We maintain our positive view on M&M and have a BUY rating on the stock amidst its consistent positive surprise on new product launches, ability to grow ahead of market and persistent focus on capital efficiency (RoE>=18%). Our last target price on M&M was pegged at ₹ 3,600/share

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