Please Share:: 
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Mahindra & Mahindra (MAHM.BO; Rs665.30; 1L)
Takeaways from Mumbai — Mahindra & Mahindra presented at the Citi India
Investor Conference in Mumbai. Below are key takeaways.
Volume growth guidance slightly muted — 11-13% growth rate for UVs and
10-12% for tractors is slightly muted, mirroring macro headwinds in the form of
increasing interest rates and higher fuel prices. However, mgmt said that these
macro conditions were more conducive to long-term growth and maintained an
optimistic stance on tractors, UVs and MHCVs/LCVs. Specifically, mgmt guided
to a doubling of volumes for the Yuvraj to 10,000-12,000, while setting a Feb-
March 2012 timeline for the opening of the additional 100,000 tractor capacity.
Mgmt was optimistic on export volumes and noted that, apart from the US, the
Sri Lanka, Bangladesh and Nepal markets presented good growth prospects.
Raw material costs and employee costs to impact margins — Mgmt noted
that raw material costs had gone up by 7-8% over FY11 resulting in the ~200bps
increase in raw materials / sales ratio. Mgmt said that price hikes as well as other
cost reduction methods will mitigate impact on the margins. Employee costs are
expected to be at ~6% of the net sales, going forward from the earlier 5%, This
reflects the increase in PF related costs (fixed by govt.) and the change due to
increase in actuarial valuations.
Balance sheet to remain healthy — Mgmt said that the company aims to keep
the D/E ratio below 0.7 and at the current 0.23, the leverage levels appear
healthy. Ssangyong mgmt has planned US$200mn investment for CY2011.
However, all investments into the company will reflect in Ssangyong’s books
without impacting M&M’s balance sheet.
Product pipeline is strong, macro issues notwithstanding — While alluding
to slightly adverse macro conditions, mgmt noted the need to refresh product
portfolio to prolong demand. The product launched planned for FY12 include 1)
the premium SUV (codenamed W201), 2) new sub-4 meter Verito (earlier
Logan), 3) Ssangyong Korando and Rexton, 4) new models on the Maxximo and
Xylo platforms.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Mahindra & Mahindra (MAHM.BO; Rs665.30; 1L)
Takeaways from Mumbai — Mahindra & Mahindra presented at the Citi India
Investor Conference in Mumbai. Below are key takeaways.
Volume growth guidance slightly muted — 11-13% growth rate for UVs and
10-12% for tractors is slightly muted, mirroring macro headwinds in the form of
increasing interest rates and higher fuel prices. However, mgmt said that these
macro conditions were more conducive to long-term growth and maintained an
optimistic stance on tractors, UVs and MHCVs/LCVs. Specifically, mgmt guided
to a doubling of volumes for the Yuvraj to 10,000-12,000, while setting a Feb-
March 2012 timeline for the opening of the additional 100,000 tractor capacity.
Mgmt was optimistic on export volumes and noted that, apart from the US, the
Sri Lanka, Bangladesh and Nepal markets presented good growth prospects.
Raw material costs and employee costs to impact margins — Mgmt noted
that raw material costs had gone up by 7-8% over FY11 resulting in the ~200bps
increase in raw materials / sales ratio. Mgmt said that price hikes as well as other
cost reduction methods will mitigate impact on the margins. Employee costs are
expected to be at ~6% of the net sales, going forward from the earlier 5%, This
reflects the increase in PF related costs (fixed by govt.) and the change due to
increase in actuarial valuations.
Balance sheet to remain healthy — Mgmt said that the company aims to keep
the D/E ratio below 0.7 and at the current 0.23, the leverage levels appear
healthy. Ssangyong mgmt has planned US$200mn investment for CY2011.
However, all investments into the company will reflect in Ssangyong’s books
without impacting M&M’s balance sheet.
Product pipeline is strong, macro issues notwithstanding — While alluding
to slightly adverse macro conditions, mgmt noted the need to refresh product
portfolio to prolong demand. The product launched planned for FY12 include 1)
the premium SUV (codenamed W201), 2) new sub-4 meter Verito (earlier
Logan), 3) Ssangyong Korando and Rexton, 4) new models on the Maxximo and
Xylo platforms.
No comments:
Post a Comment