M&M Shares Soar as Jefferies Maintains 'Buy' Call, Predicts 50%+ Upside

M&M Shares Soar as Jefferies Maintains ‘Buy’ Call, Predicts 50%+ Upside

M&M shares surged in February 2025, driven by Jefferies’ positive outlook. The brokerage’s ‘Buy’ rating and a target price of Rs 4,075 indicate a significant upside potential from current levels.

On February 24, 2025, shares of Mahindra & Mahindra (M&M) witnessed a rise of nearly 2% to Rs 2,712. This uptrend follows a sharp 6% drop in the previous session. The surge is attributed to Jefferies’ reaffirmation of its ‘Buy’ rating, along with a target price that signals a substantial upside potential of 52.6% from the last close on the National Stock Exchange.

Key Developments

Jefferies’ Positive Outlook

Analysts at Jefferies view the recent decline in M&M’s stock as a buying opportunity. The brokerage finds M&M’s valuation attractive, noting that its core FY26 estimated price-to-earnings ratio of 20x supports an 18 percent EPS CAGR for FY25-27.

“We believe M&M’s current valuation presents a compelling opportunity for investors. Its strong fundamentals and favorable industry tailwinds position it for continued growth,” said an analyst from Jefferies.

Strong Demand for Electric Vehicles

M&M’s newly launched electric sports utility vehicles (SUVs) have received an overwhelming response, recording 30,179 bookings on the first day of launch. The total booking value stands at Rs 8,472 crore (ex-showroom price).

30,179 bookings for M&M’s electric SUVs on the first day of launch.

Market Share Gains

Jefferies also considers M&M a stronger investment case compared to Maruti Suzuki and Hyundai, citing its favorable industry demand tailwinds and increasing market share in both tractors and SUVs.

M&M’s market share in the tractor segment has grown to 52%.
The company has also gained significant market share in the SUV segment, with its XUV700 model becoming a bestseller.

Background & Context

M&M’s Recent Performance

M&M’s shares have had a volatile start to 2025, with a year-to-date decline of over 11%. However, the company’s strong fundamentals and positive industry outlook have supported its recovery in early 2025 weeks.

Industry Trends

The Indian automotive industry is expected to grow at a CAGR of 8% over the next five years, driven by increasing disposable income and a growing middle class. The demand for electric vehicles is also expected to surge, with the government promoting their adoption.

Expert Insights

“M&M is well-positioned to benefit from the growing demand for electric vehicles in India. Its strong brand presence and wide distribution network will be key drivers of its success,” said an analyst from ICICI Securities.

“M&M’s recent acquisition of British electric vehicle manufacturer REE Automotive will further strengthen its position in the EV market. The company is now well-equipped to compete with global players,” said an analyst from Kotak Mahindra Securities.

Looking Ahead

Analysts remain optimistic about M&M’s long-term prospects. The company’s strong product lineup, focus on innovation, and favorable industry tailwinds are expected to drive its growth in the coming years.

Investors should continue to monitor the company’s performance, particularly its progress in the electric vehicle segment. M&M’s ability to capitalize on the growing demand for EVs will be crucial for its future success.