M&M's growth story gains traction: Brokerages revise targets amid strong demand, bullish outlook

Mahindra & Mahindra (M&M) is riding high on strong demand in both its tractor and SUV segments, prompting a series of target upgrades by major brokerages. With a current market price of Rs 2,891, brokerages see a promising upside, citing robust growth and strategic expansions across sectors. Here’s a breakdown of the recent outlook from leading analysts.

Jefferies: Buy | Target: Rs 3,700 (Up from Rs 3,510)
Jefferies reiterated a 'Buy' on M&M, raising its target to Rs 3,700. The firm sees a rebound in tractor demand, notably after a 1.5-year lull, and expects M&M's expanded portfolio to drive consistent growth in SUV volumes. With M&M capturing market share across segments, Jefferies raised FY24-27 EPS estimates by three to four per cent, projecting an impressive 19 per cent EPS CAGR over the forecast period.

Nomura: Buy | Target: Rs 3,664 (Up from Rs 3,417)
Nomura has also maintained its 'Buy' rating, increasing its target price to Rs 3,664. The brokerage acknowledges M&M’s robust performance and demand visibility in its core segments, aligning with Jefferies on the positive outlook.

CITI: Buy | Target: Rs 3,520 (Down from Rs 3,590)
While CITI remains optimistic with a 'Buy' rating, it slightly reduced its target to Rs 3,520 from Rs 3,590. The recent quarterly performance exceeded expectations, with both the farm and auto segments showing strength. Following a strong festive season, CITI maintains a positive demand outlook but warns of potential near-term margin pressures as the company readies its BEV (Battery Electric Vehicle) launch.

JP Morgan: Overweight | Target: Rs 3,400 (Up from Rs 3,330)
JP Morgan upgraded its target price to Rs 3,400, maintaining an 'Overweight' stance on M&M. The brokerage remains optimistic about the company's growth trajectory.

Morgan Stanley: Overweight | Target: Rs 3,336 (Up from Rs 3,304)
Morgan Stanley also raised its target to Rs 3,336 and kept its 'Overweight' rating, citing strong fundamentals and growth potential in M&M's core areas.

CLSA: Outperform | Target: Rs 3,440 (Up from Rs 3,400)
CLSA raised its target for M&M to Rs 3,440, maintaining an 'Outperform' rating. The firm is particularly encouraged by M&M’s robust SUV growth and positive market positioning.

Macquarie: Outperform | Target: Rs 3,441
Macquarie reiterated its 'Outperform' rating, setting a target of Rs 3,441. It highlighted the company's solid Q2 results, raising tractor guidance while maintaining confidence in the SUV segment. Macquarie noted potential capacity constraints in ICE SUVs by FY26 if demand continues its current momentum.

Brokerages are bullish on M&M's growth story, with several seeing further upside. With strategic expansions, consistent market share gains, and a positive demand outlook, M&M appears well-positioned for continued growth in both its auto and farm segments.