Mahindra & Mahindra Ltd - Q3FY12 Result Update - Emkay

Reco: BUY
CMP: Rs 689
Target Price: Rs 815

In line results, MVML clarity emerges, Retain BUY

- M&M+MVML performance in line with Adj. EBITDA at Rs 10.9bn (est. Rs 10.7bn). APAT at Rs 6.8bn (est. Rs 6.9bn) was impacted by higher depreciation and tax rates

- Mgmt. expects subdued tractor demand in 4QFY12 and there after momentum to pick up. Scorpio maintains upward momentum with no cannibalization seen from XUV

- Lower M&M vol. est. by 2%/6% and lower EBITDA margins by 10bps/90 bps in FY12/13. We factor in 5% growth in tractors and 17% for Auto segment, driven by XUV5OO

- Lower TP to Rs. 815. Valued standalone business at Rs. 603, MVML at Rs. 65 and listed subs at Rs. 147. Key risks - newsflow on acquisition and Ssangyong performance.

Source : Equity Bulls

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