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Mahindra & Mahindra Overweight
MAHM.BO, MM IN
Jul'11 Sales (+33% yoy) driven by automotive
segment
M&M’s unit sales grew +33% yoy over the month, with growth being
driven by the automotive segment (+43% yoy). The farm equipment
segment sales grew (+15% yoy).
Automotive segment saw healthy growth of +43% yoy driven by the
ramp up of the Maximmo and the recently launched Genio pick up –
thus, LCV’s grew to 13,472 units (+91%yoy). Passenger UV sales
(+35% yoy) continued to report impressive growth. Low value three
wheeler sales were flat yoy. The management highlighted that current
waiting periods on their products has reduced, given the recent impact of
the interest rate hikes. However, they re-iterated that M&M would grow
ahead of the industry for the year, driven by its refreshed product
portfolio.
Farm equipment sales grow: Tractor sales at 16,718 units were up
+15% yoy - driven by the prospects of a normal monsoon. While sales
are up 19% YTD, management has re-iterated its FY12E forecast growth
rates which are likely to be in low double digits.
At our recent conference in New York, management had indicated that
industry growth rates are likely to be in the range of 10-12% for tractors
and 11-13% for UVs in FY12. The OEM is ramping up production of the
‘Yuvraj’ tractor to 20,000 units in the year (from 10,000 in FY11); on
UVs – they expect to launch the new W201 SUV by the end of the year.
Over the month, the stock price (+6% yoy) outperformed the broader
BSE Sensex (-2% yoy). We re-iterate our OW stance on the stock as we
think the OEM will benefit from a refreshed UV product portfolio as
well as sustained growth in the FES segment
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Mahindra & Mahindra Overweight
MAHM.BO, MM IN
Jul'11 Sales (+33% yoy) driven by automotive
segment
M&M’s unit sales grew +33% yoy over the month, with growth being
driven by the automotive segment (+43% yoy). The farm equipment
segment sales grew (+15% yoy).
Automotive segment saw healthy growth of +43% yoy driven by the
ramp up of the Maximmo and the recently launched Genio pick up –
thus, LCV’s grew to 13,472 units (+91%yoy). Passenger UV sales
(+35% yoy) continued to report impressive growth. Low value three
wheeler sales were flat yoy. The management highlighted that current
waiting periods on their products has reduced, given the recent impact of
the interest rate hikes. However, they re-iterated that M&M would grow
ahead of the industry for the year, driven by its refreshed product
portfolio.
Farm equipment sales grow: Tractor sales at 16,718 units were up
+15% yoy - driven by the prospects of a normal monsoon. While sales
are up 19% YTD, management has re-iterated its FY12E forecast growth
rates which are likely to be in low double digits.
At our recent conference in New York, management had indicated that
industry growth rates are likely to be in the range of 10-12% for tractors
and 11-13% for UVs in FY12. The OEM is ramping up production of the
‘Yuvraj’ tractor to 20,000 units in the year (from 10,000 in FY11); on
UVs – they expect to launch the new W201 SUV by the end of the year.
Over the month, the stock price (+6% yoy) outperformed the broader
BSE Sensex (-2% yoy). We re-iterate our OW stance on the stock as we
think the OEM will benefit from a refreshed UV product portfolio as
well as sustained growth in the FES segment
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