Mahindra and Mahindra limited

Industry Profile. :.  Indian automobile industry is one of the largest and one of the most competitive in the world. In FY 15-16 production total was 23.96 million vehicle. The sector account for 7.1 per cent of GDP of India out of which 81% is Two wheeler market. Indian automotive aftermarket is estimated to grow at around 10-15 per cent to reach US$ 16.5 billion by 2021 from around US$ 7 billion in 2016. It has the potential to generate up to US$ 300 billion in annual revenue by 2026, create 65 million additional jobs and contribute over 12 per cent to India’s Gross Domestic Product. Maruti in Car and Hero Moto corp is in Two wheeler market are leader. Passenger Vehicle holding 13% market. Maruti Suzuki expects Indian passenger car market to reach four million units by 2020, up from 1.97 million units in 2014-15. Mr Young Key Koo, Managing Director, Hyundai Motor India Ltd, has stated that India is a key market for the company, not only in terms of volumes but also as a hub of small products for exports to 92 countries. As many companies trying to increase revenue, rural Market is large for further growth. India is also being one of the leading exporter of automobiles and has strong export growth expectations for near future. In April-March 2016, overall automobile exports grew by 1.91 per cent. PV, Commercial Vehicles (CV), and Two Wheelers (2W) registered a growth of 5.24 per cent, 16.97 per cent, and 0.97 per cent respectively in April-March 2016 over April-March 2015. The industry has attracted Foreign Direct Investment (FDI) worth US$ 15.79 billion during the period April 2000 to September 2016, according to data released by Department of Industrial Policy and Promotion (DIPP). Several automobile manufacturers, from global majors such as Audi to Indian companies such as Maruti Suzuki and Mahindra & Mahindra, are exploring the possibilities of introducing driverless self-driven cars for India.

Company Profile :  Mahindra and mahindra, Indian multinationl automobile company is one of the largest manufacturer of tractors in the world. The company was set up as a steel trading company in 1945 in ludhiyana. Mahindra produces a wide range of vehicles, including MUVs, LCVs and three-wheelers. It manufactures over 20 models of cars, including larger, multi-utility vehicles like Scorpio, Bolero, XUV 500, Quanto, Verito, xylo, e2o Indias leading electric vechical.  Mahindra began manufacturing tractors for the Indian market during the early ’60s. It is the top tractor company in the world (by volume) with annual sales totaling more than 200,000 tractors. Since its inception, the company has sold over 2.1 million tractors.  Mahindra tractors are available in 40 countries, including India, the United States, China, Australia, New Zealand, Africa (Nigeria, Mali, Chad, Gambia, Angola, Sudan, Ghana, and Morocco), Latin America (Chile, Argentina, Brazil, Venezuela, Central America, and the Caribbean), South Asia (Sri Lanka, Bangladesh, and Nepal), the Middle East (Iran and Syria) and Eastern Europe (Serbia, Turkey, and Macedonia. The company manyfacturing them in four plants in india, two in china, thre in US and one in austrelia.

Shareholding Pattern  :  26.69% stake is held by Pomoter out of which 0.09% is Forign. 6.95% held by Mutual Funds. 0.38% held by Financial institutions. 13.72% held by Insurance companies. 46.44% held by foreign investors. So yes the company is largly held by institutions. Remaining is held by public.

Financials and Ratios :.

 2010 - 112011 - 122012 - 132013 - 142014 - 152015 - 162016 - 17
Revenue23,894.4132,319.3140,990.3341,226.4939,794.3641,739.8345,127.85
Net Profit2,662.102,878.893,352.823,758.353,321.113,167.483,955.65
NPM11.349.038.299.278.527.749.03
EPS44.3346.8954.6161.0753.665166.37
Book Value171.27202.95248.14284.26325.40366.10432.42
Dividend Per Share11.5012.501314121213
Dividend Payout26.5226.5223.8022.9422.4423.5318.22
ROE26.4624.0822.8822.3917.2514.5915.40
ROCE19.5917.3917.3616.6813.8512.3113.23
ROA13.6212.0312.2112.0110.088.6910.05
Debt to Equity0.230.270.220.220.140.080.11
Asset Turnover120.06133.21147.30129.46118.21112.28111.30

Future Prospects : From last few Quarter, the company is not going anywhere. It is like standstill. Share price is also same. Mainly because of it is not Automobile but Tractor Company. For showing better performer, the company need to sell more tractor. Recently the company invested heavily on passenger Vehicle segment, which is dominated by Maruti Suzuki, Tata. Even though Automobile business is performing good, Agriculture segments is lagging behind. For company to perform, Agriculture segment also need to perform better.

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About Ashutosh

Tracking Indian Capital Market since 2014. Finance Student, Love to write about Finance and investing