Leading brokerage firms have given a big thumbs up to the M&M share price after the strong Q3 performance. Jefferies, Nomura, Nuvama have maintained ‘Buy’ rating with target prices suggesting up to 27% upside potential. The company’s smart moves across the SUV, tractor, and LCV segments has been making waves for the Thar maker.
Jefferies on M&M
Jefferies maintained a ‘Buy’ rating on M&M. The brokerage said that the company delivered its 15th consecutive quarter of double-digit EBITDA growth, with Q3 up 27% YoY.
The Anand Mahindra-led automobile company is benefitting from strong industry demand and market share gains across tractors, SUVs and LCVs, although it sounded uncertain on FY27 tractor industry outlook given the high base.
“We fine-tune estimates and expect MM’s core EPS to rise 30% YoY in FY26, followed by 15% CAGR over FY25-28. Its 23x FY27E PE is attractive,” said Jefferies.
The international brokerage house has a target price of Rs 4,500, which looks at an upside of 22%.
Nomura on M&M
Nomura raised the target price on M&M to Rs 4,662 from Rs 4,355, an upside of 27%. The stock remains as the brokerage’s OEM pick as it is outperforming across segments. The brokerage has raised overall volumes by 4-7%.
“For SUVs, we estimate volume at 652k, +18%, for FY26F, at 739k, +13%, for FY27F, and 814k, +10%, for FY28F, driven by premiumisation and strong model cycle. We also raise our tractor volume growth to 24% and 5% for FY26 and FY27, which is 10% higher. We believe ASPs will recover from Q4,” said Nomura.
The stock’s current valuations at 14.6x FY28 enterprise value to EBITDA and 20x FY28 P/E look attractive to Nomura.
Nuvama on M&M
Nuvama Institutional Investors kept the price target unchanged at Rs 4,400, and retained its ‘Buy’ rating on M&M. The target price sees an upside of 20%.
Over FY26–28, the brokerage expects the auto segment’s revenue CAGR at 12%, driven by healthy demand for key models along with a pipeline of new models. After delivering robust 25% growth in FY26, the farm segment’s revenue shall expand at a moderate 7% CAGR.
“We estimate revenue and core earnings CAGRs shall be 11% and 10% over FY26–FY28 with a healthy RoIC of 60%-plus,” said Nuvama.
Motilal Oswal on M&M
Motilal Oswal on M&M has maintained its ‘Buy’ rating, with a target price of Rs 4,378, implying an upside of more than 19% from the current price value.
While the Farm Equipment Sector (FES) segment margin expanded 210 basis points YoY to 20.2%, the auto segment’s margin was flat YoY at 9.5% (despite EV ramp-up). The estimates are that M&M will post a CAGR of 18% revenue, 18% EBITDA, 20% in net profit over FY25-28.
While MM has outperformed its own targets of earnings growth and RoE of 18%, it remains committed to delivering 15-20% EPS growth and 18% RoE, ensuring sustained profitability and shareholder value.