Sign up for Equitymaster's free daily newsletter, The 5 Minute WrapUp and get access to our latest Multibagger guide (2017 Edition) on picking money-making stocks.

This is an entirely free service. No payments are to be made.

Download Now Subscribe to our free daily e-letter, The 5 Minute WrapUp and get this complimentary report.
We hate spam as much as you do. Check out our Privacy Policy and Terms Of Use.
M & M's analyst meet update - Views on News from Equitymaster
  • E-MAIL
  • A  A  A
  • Sep 9, 2000

    M & M's analyst meet update

    Mahindra & Mahindra is engaged in the manufacture of Multi Utility vehicles (MUVís), tractors (upto 60 HP category) and light commercial vehicles (LCVs). For FY2000, in volume terms UVís and LCV's contributed to 52% of sales and tractors contributed 48% of sales.

    The following are the main points of the M & M analyst presentation:

    • M & M's Utility Vehicle (UV) volumes are down for the period April-July 2000 by 15% YoY to 17,171 units. For the same period of last year the company had sold 20,034 units. The main reasons for this performance was uniform sales tax issue of 12% and drought conditions.

    • The total industry sales were up by 10% YoY, mainly due to the expansion of the UV market by Toyota Qualis. Many car users have turned buyers of the Toyota Qualis. This has lead to the growth in the market. However if Qualis is to be excluded from the UV market, then the industry has actually declined by 13% YoY. All players except Telco have seen a decline in their volumes. Telco's timely launch of its Sumo variant has helped it.

    • The company's recent launch of 'Bolero' is expected to take up the company's market share in the second half. They are expecting an improvement from October 2000 onwards. The response for the Bolero has been good and it has waiting list of about 2 months. The company has a string of launches planned in the UV segment over the next year like Bolero's petrol version, Savaari with FRP top and diesel three wheelers.

    • In the Light Commercial Vehicle (LCV) market M & M has done well. Its volumes were up by 22.6% from April-July 2000. The industry saw an overall decline of 1% in volumes. Other players like Telco, and Bajaj Tempo also saw volumes decline. Eicher saw a 37% jump in volumes during this period.

    • The company has been absorbing the cost of Euro compliance during the year, as it did not want to pass this off to consumers. This has lead to a decline in operating margins in the 1QFY01.

    • In the tractor industry M & M has fared much better than other players. M & M's volumes went up by 1.7% YoY, while the industry saw a decline of 17.4% YoY. All other players saw a decline in volumes. Punjab Tractor Ltd volumes fell by 19.2% YoY, TAFE reported a decline of 40.6% YoY and Escorts saw a fall of 25.8% YoY. The main reason mentioned by the company for better performance is the strong efforts of the company's sales force, even in the drought like conditions.

    • M & M expects the industry to pick up in the second half from October 2000 onwards due to normal monsoons. It has captured the number one position in tractors in 16 out of 17 states. These states accounted for 95% of total industry volumes. Its market leadership continues in the 25 HP and 35 HP category.

    • In its technology ventures the company is planning on merging Mahindra Network ( a 100% subsidiary of M & M) with Mahindra Consulting ( M & M's owns 60% of this company) to avoid conflict of interests.

    • The company has given an additional 3% stake to BT in their subsidiary MBT. This has been done on a consideration of Rs 135 m for 5.05 m shares. This works out to Rs 26.7 per share. BT in return has committed business worth Rs 2.35 bn per annum. However as the IPO price is expected to be much higher than the price given to BT, it still does not seem justified to shareholders.

    On the current price of Rs 199.6 it is trading at 8.4 x FY00 earnings



    Equitymaster requests your view! Post a comment on "M & M's analyst meet update". Click here!


    More Views on News

    Mahindra & Mahindra Ltd: Robust Performance amid Uncertainties! (Quarterly Results Update - Detailed)

    Jul 4, 2017

    The Growth in the Farm Segment offsets mediocre performance in the auto business.

    Mahindra & Mahindra Ltd: Tractor Demand offsets the Notebandi hit Auto Segment! (Quarterly Results Update - Detailed)

    Mar 20, 2017

    Mahindra & Mahindra has announced its financial results for the third quarter of the financial year 2016-17 (2QFY17).

    Mahindra & Mahindra Ltd: Tractors Demand Upbeat, Gaining Market Share in Auto (Quarterly Results Update - Detailed)

    Nov 22, 2016

    Mahindra & Mahindra has announced its financial results for the second quarter of the financial year 2016-17 (2QFY17). During the quarter, revenues grew by 15.6% YoY and adjusted net profits grew by 18.5%.

    Tata Motors Ltd: Another Disappointing Quarter, Management fails to Perform! (Quarterly Results Update - Detailed)

    Aug 14, 2017

    Tata Motors Ltd disappoints again for both India and JLR business. Management commentary indicates a slow year ahead.

    Maruti Suzuki Ltd: Bumpy First Quarter. GST dents Margins! (Quarterly Results Update - Detailed)

    Aug 2, 2017

    GST realted cost impacts Margins, Management expects good year ahead.

    More Views on News

    Most Popular

    Demonetisation Barely Made Any Difference to Tax Collections(Vivek Kaul's Diary)

    Aug 7, 2017

    The data tells us quite a different story from the one the government is trying to project.

    A 'Backdoor' to Multibaggers: It's Like Investing in Asian Paints Ten Years Ago(The 5 Minute Wrapup)

    Aug 10, 2017

    Don't miss these proxy bets on growing companies or in a few years you will be looking back with regret.

    Should You Invest In Bharat-22 ETF? Know Here...(Outside View)

    Aug 8, 2017

    Bharat-22 is one of the most diverse ETFs offered so far by the Government. Know here if you should invest...

    Signs of Life in the India VIX(Daily Profit Hunter)

    Aug 12, 2017

    The India VIX is up 36% in the last week. Fear has gone up but is still low by historical standards.

    7 Financial Gifts For Your Sister This Raksha Bandhan(Outside View)

    Aug 7, 2017

    Raksha Bandhan signifies the brother-sister bond. Here are 7 thoughtful financial gifts for sisters...

    Copyright © Equitymaster Agora Research Private Limited. All rights reserved.
    Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement.

    LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.

    SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.

    Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
    Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: info@equitymaster.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407

    Become A Smarter Investor In
    Just 5 Minutes

    Multibagger Stocks Guide 2017
    Get our special report, Multibagger Stocks Guide (2017 Edition) Now!
    We will never sell or rent your email id.
    Please read our Terms


    Aug 18, 2017 (Close)



    Compare Company With Charts