Mahindra & Mahindra (MM IN) – Q1FY27 Result Update – Healthy Demand Sustained amid Cost Pressures – BUY
Published on 31 Jul 2026
MM’s Q1FY27 standalone operating revenue and PAT were modestly above estimates, while margins missed estimates as it was impacted by RM inflation, supply chain disruption, and manpower issues. The management is taking aggressive cost reduction measures and maintained FY27 volume growth guidance for its SUVs at mid-to-high teens, tractor industry at mid-single digits, and LCV industry at high-single digits. Operating leverage from accelerating BEV volumes and pricing should improve profitability along with the Growth Gems contributing to group’s topline and bottom-line. We estimate volume/realization CAGR of 8.0%/3.6% over FY26-28E, translating into revenue/EBITDA/APAT CAGR of 12.7%/10.3%/9.2%. We reiterate ‘BUY’ rating with TP of INR3,950 (previous INR3,900), valuing the core business at 24x P/E on FY28E standalone EPS, and its share of subsidiaries’ value.
