Auto major Mahindra & Mahindra (M&M) is in focus after announcing its September quarter results. Following the company’s Q2 performance, leading brokerages have maintained a bullish stance on the stock. Both Nuvama and Nomura have reiterated their ‘Buy’ ratings. The brokerages have projected strong earnings growth driven by steady launch pipeline going forward.
Nuvama on M&M: 15% growth likely annually
According to the brokerage report by Nuvama, Mahindra & Mahindra is expected to maintain its growth momentum, led by the auto and farm segments.
The brokerage has given a buy rating on the stock with a target price of Rs 4,200. This implies an upside potential from current levels.
“As per the brokerage report, over FY25–FY28, we reckon the auto segment’s revenue CAGR at 15% driven by healthy demand for key models along with a pipeline of new models,” Nuvama said.
It further expects the farm segment’s revenue to “clock a 13% CAGR nurtured by share gains and benign government policies.”
The brokerage estimates that the company’s overall revenue and core earnings CAGRs will be around 15% and 19% respectively during FY25-FY28, while maintaining a strong ‘return on investment’ of over 60%.
Nuvama highlighted that Mahindra’s upcoming launches could act as a key trigger for growth. The company plans to unveil the XEV 9s (seven-seater E-SUV) on November 27, 2025, followed by a range of other models such as the new-gen ICE XUV 7XO, E-XUV 3XO, and Vision Series (S, SXT, X, T).
“Rising BEV penetration shall help reduce fleet emissions, which should enable the company to meet the upcoming CAFÉ 3 norms,” the brokerage said. It projects BEV volumes at 48,000 units in FY26 and 77,000 units in FY27, forming 8% and 11% of domestic UVs, respectively.
Nomura on M&M : Maintains ‘Buy’, sees 21.6% upside
Echoing similar optimism, Nomura has also maintained a ‘Buy’ rating on Mahindra & Mahindra with a target price of Rs 4,355. This translates to a potential upside of around 21.6% from the current market levels.
According to the brokerage report, “Mahindra and Mahindra remains our top OEM pick. We estimate its SUV growth to continue outperforming the industry at 18%/11%/7% over FY26–28F, driven by premiumization and strong model cycle.”
Nomura believes that the company’s aggressive push in both BEVs and internal combustion models (ICE), along with potential hybrid introductions, will help it maintain a competitive edge. “PLI approval for BEVs will give MM a strategic advantage vs peers,” the report noted.
Nomura expects the company’s EV EBITDA margins to move into double digits as more of its electric models receive PLI support. The brokerage also revised its EV/EBITDA multiple to 16x (from 15x).
“Current valuation at 12.5x FY28F EV/EBITDA and 20.6x FY28F P/E (adjusted for subsidiaries) is significantly attractive, in our view,” the brokerage house added.
