Buy Mahindra & Mahindra Ltd. - Management meet update - Emkay

Mahindra & Mahindra Ltd.
Reco: BUY
CMP: Rs651
Target Price: Rs920

Tractors - Concerns overdone, Retain BUY

- No signs of stress in tractors as dealer inventory, dealer funding, NPA scenario with NBFC is under control. Farmers cash flows and tractor rentals are also stable

- No concerns on demand over next four to five years. There exists enough scope of raising penetration levels

- Retain our FY13 vol. growth of 12% for the industry (refer our attached note – Eying new highs) and BUY rating on the stock

- Key concerns arise from complex business structure and structurally lower EBIDTA margins in the standalone business due to higher production in MVML.

Source : Equity Bulls

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