18 April 2018 INDIA | AUTOMOBILES | COMPANY UPDATE
MAHINDRA & MAHINDRA M&M 3.0: The NEW is coming
At the cusp of a market Undisputed leadership 50% market share share recovery in PVs in tractors in SCVs 18 April 2018 INDIA | AUTOMOBILES | COMPANY UPDATE
TABLE OF CONTENTS
Introduction 3
Key charts 4 Industry Overview 5 - Snapshot: Passenger Vehicle Industry 5 - Snapshot: Utility Vehicles Segment 6 - New definition of 'success': 4K monthly sales! 7 New vehicles to be launched by M&M 8 Compact SUVs: ‘Highest Volume + Fastest Growing’ segment in SUVs 9 - S201/ Tivoli to be the backbone of Mahindra 3.0 10 - Positioning of M&M S201 11 Premium SUVs: ‘low volume but high value’ 12 - G4 Rexton 13 - Positioning of G4 Rexton 14 MPVs: Smart ‘Family’ UVs 15 - Positioning of M&M U321 16 New models to drive M&M's sales 17 - Model-wise volume projections 17 Market leader in SCV segment 18 Undisputed leader in the tractor segment 20 Financial Tables 21
RECENT REPORTS
RURAL SAFARI VII INDIA REAL ESTATE INDIA CEMENT INDIA PHARMA INDIA SPECIALTY CHEMICALS
JM Financial Institutional Securities Limited Page 2 18 April 2018 INDIA | AUTOMOBILES | COMPANY UPDATE
Mahindra & Mahindra (MM IN) M&M 3.0: The NEW is coming
M&M 3.0 is the most crucial and promising M&M 3.0: There have been phases for almost all PV players in India. Maruti revamp for M&M (UVs), for it has lost Suzuki (MSIL), for example, struggled with the ‘compact car player’ tag for long, significant market share in its core segment, making multiple unsuccessful attempts to establish itself in higher price brackets. However, in its new avatar, Maruti 2.0, it has shed that image and UVs. successfully emerged as a mid-size player. It is fair to say M&M already witnessed In FY12, M&M had the lion’s share of the 2.0 during the Scorpio and XUV500 launches and the subsequent years of their utility vehicle (UV) segment in India. Its success. Even today, these models are continuing with reasonable volumes and are due for a refresh. However, M&M 3.0 is not about incremental refreshes dominant position was a combination of but a transformational change in product design and addition of new legacy advantages and product innovation. products that carry a ‘soft’ appeal (attuned for urban customers). As per M&M has enjoyed a great run, from making management, the new models will be feature-loaded products, offering Commander (Jeep) to the overly successful exciting driving performance. The product offensive being readied by M&M is Bolero, and then playing the masterstroke similar to Maruti 2.0, both in terms of the number of new launches and with the Scorpio and XUV500. However, with seriousness (towards an ambition). some not-so-successful launches in between, What is important for success? Being an established home-grown player, M&M’s market share declined to 25% in M&M does not suffer from the traditional disadvantages faced by foreign OEMs FY18 (in UVs). in India, including a thinly spread network, concern on after-sales service, availability of spare parts, etc. Instead, it starts with multiple Nonetheless, the winds of change are visible (relative) advantages. Hence, its success solely depends on the product, price again. M&M is readying a portfolio of positioning and sales aggression. In this report, we have tried to study revamped existing models and multiple new competition, possible price positioning for M&M models (basis competition models to plough back market share in the and M&M’s product portfolio) and based on that, likely sales performance. Our fast-growing UV segment. New models and study indicates that each successful product has garnered 9-13% market share an upgrade of sales network; signal concerted in the UV segment, in the past. With high growth and base of UV sales, this efforts to provide an all-round customer range today stands at 5-8%. experience and gain traction in the urban Sweet timing of ‘urban’ launches with positive rural sentiment: The Government market. of India’s (GOI)’s rural impetus has put more money in the hands of the rural M&M is a sizeable no. 3 player in India. population. Also, the expectation of a normal monsoon has improved consumption sentiment. This is already visible in the sales of M&M’s existing, Although its ranking may not rise or fall, with new mainstay UV models, Bolero and Scorpio. General elections in 2019 are also likely products, it is on the road to recovery in the PV to provide a fillip to UV sales, as seen in the past. We reiterate BUY with a revised segment. TP of INR 960 (14x Mar’20 PER core business + INR 346 value of investment in subsidiaries/associates).
Recommendation and Price Target Financial Summary (INR mn) Current Reco. BUY Y/E March FY16A FY17A FY18E FY19E FY20E Previous Reco. BUY Net Sales 4,08,754 4,37,853 4,83,196 5,67,634 6,60,887 Current Price Target (12M) 960 Sales growth (%) 7.3 7.1 10.4 17.5 16.4 Upside/(Downside) 18.6% EBITDA 46,202 47,693 60,806 74,662 88,293 Previous Price Target 840 EBITDA (%) 11.3 10.9 12.6 13.2 13.4 Adjusted net profit 31,361 34,072 38,737 47,438 56,391 Change 14.3% EPS (INR) 52.9 57.4 32.6 40.0 47.5 EPS growth (%) 14.4 8.5 -43.2 22.5 18.9 Key Data – MM IN ROIC (%) 0.0 29.3 33.6 38.4 40.9 Current Market Price INR809 ROE (%) 14.3 14.2 14.3 15.6 16.3 Market cap (bn) INR1,006.2/US$15.3 PE (x) 15.3 14.1 24.8 20.2 17.0 Price/Book Value (x) 2.1 1.9 3.4 3.0 2.6 Free Float 81% EV/EBITDA (x) 20.7 20.4 15.9 12.9 10.8 Shares in issue (mn) 1,187.2 Dividend Yield (%) 1.5 1.6 0.9 0.9 0.9 Diluted share (mn) 1,187.2 3-mon avg daily val (mn) INR1,892.7/US$28.8 Source: Company data, JM Financial. Note: Valuations as of 17/Apr/2018 52-week range 819/612 JM Financial Research is also available on: Bloomberg - JMFR
JM Financial Institutional Securities Limited Page 3 Mahindra & Mahindra 18 April 2018 Key Charts
Exhibit 1. Passenger Vehicle Segment-wise share Exhibit 2. India’s UV to PV ratio is still below some other major markets 9% 9% 9% 8% 7% 6% 6% 6%
13% 14% 21% 21% 21% 21% 25% 28%
79% 77% 70% 71% 72% 73% 69% 66%
FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18
Cars UV Vans
Source: JM Financial, SIAM Source: Company, JM Financial
Exhibit 3. Rising share of SUVs within UVs Exhibit 4. Compact SUV most dominant sub-segment now
12% 11% 19% 19% 24% 9% 28% 11% 13% 34% 27%
35% 81% 76% 72% 46% 51% 32%
FY16 FY17 FY18 FY16 FY17 FY18 SUVs MPVs CSUVs Mid SUVs Premium SUVs Bolero
Source: JM Financial Source: JM Financial
Exhibit 5. M&M volume estimate (domestic, ‘000 units) Exhibit 6. Domestic monthly sales of M&M PVs (‘000 units)
400 378 31.5 20 350 40 311 26.0 300 18 56 35 250 20.7 19.7 200
150 261 236 248 255 100
50
0 FY17 FY18 FY19E FY20E
Existing Models S201 U321 New G4 FY17 FY18 FY19E FY20E
Source: JM Financial,SIAM Source: JM Financial JM Financial Institutional Securities Limited Page 4 Mahindra & Mahindra 18 April 2018 Industry Overview Snapshot: Passenger Vehicle Industry The domestic passenger vehicle industry is divided into three segments: a) passenger cars, b) utility vehicles and c) vans. Passenger car segment (including hatchbacks and sedans) is the mainstay of the domestic auto industry, with a 2/3 share of the passenger vehicle market. In FY12, its share was close to 3/4, with a little over 20% held by utility vehicles and vans combined. In FY12, M&M, Toyota and Tata Motors commanded ~90% of the utility vehicles market with mid/full-size utility vehicles. Since FY13, the utility vehicles segment has been on an uptrend driven by the introduction and customer acceptance of compact utility vehicles, primarily led by MSIL (Ertiga) and Renault (Duster), followed by the launch of the highly successful Compact SUV Ford Ecosport.
Exhibit 7. Segment wise growth in PVs Domestic PV Industry ('000 units) FY12 FY18 6yr-CAGR Remarks
Passenger Cars – PCs (A) 2,030 2,173 1% UV segment has outperformed Utility Vehicles – UVs (B) 365 922 17% other segments by a wide margin. Vans (C) 235 192 -3%
Passenger Vehicles 2,629 3,273 4%
Source: JM Financial, SIAM
Exhibit 8. Segment-wise share Exhibit 9. India’s UV to PV ratio is still below some other major markets 9% 9% 9% 8% 7% 6% 6% 6%
13% 14% 21% 21% 21% 21% 25% 28%
79% 77% 70% 71% 72% 73% 69% 66%
FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18
Cars UV Vans
Source: JM Financial, SIAM Source: Company, JM Financial
Although there has been a significant increase in the share of the utility vehicles in the domestic market, with respect to some of the major markets, India’s UV to PV ratio is still far behind. India’s current UV to PV ratio of 28% is similar to the US in 2007. In 2017, US’ share of UVs was 41%, China 37%, while the global average was 31%. Primary drivers for global growth in UVs have been:
1. Emergence of UV as the new ‘family car’ 2. Higher safety perception 3. Driving comfort (larger leg space) 4. Preference for recreational driving 5. Poor quality of road infrastructure 6. Extreme weather conditions
JM Financial Institutional Securities Limited Page 5 Mahindra & Mahindra 18 April 2018 Snapshot: Utility Vehicles Segment Just like the passenger car segment (with hatchbacks and sedans), utility vehicles too have sub-segments. It comprises: a) SUVs and b) MPVs. SUV share (in UVs) has swiftly increased from 72% in FY16 to 81% in FY18, propelled by the successful launches of compact SUVs such as the Maruti Vitara Brezza, Tata Nexon and Honda W-RV.
Exhibit 10. SUVs leading the race… '000 units FY16 FY18 2yr-CAGR Remarks
SUVs 420 751 34% Compact SUVs MPVs 167 171 1% command >50% share in SUVs Total UVs 586 922 25% Source: JM Financial, SIAM
In India, the compact UV segment has gained share from hatchback upgraders and sedan buyers and the reasons for buying a UV are not very different from the ones in the "There is a distinct change in the international markets: behavioral pattern of Indian consumers. Higher value perception (as compared to sedans) Ten years ago utility vehicles were looked upon as mini trucks. Today more Better road visibility due to high seating people are buying utility vehicles as they More comfortable given larger leg space (as compared to hatchbacks) are macho, can be used for weekend Better road presence trips. If new models come in at Preference for recreational driving attractive price points, there would be a Poor road quality further shift in demand for compact utility vehicles".
Apart from the above, other major reasons for the increase in adoption of compact UVs have Mr. S. Sandilya, Ex-President - SIAM been the advantages that they offer via-a-vis a mid/full-size UV: a) an attractive price point (usually sub-INR 1mn), b) no compromise on mileage, c) ease of driving and parking (due to compact dimensions) and d) ease of maintaining a compact vehicle. Ford Ecosport (the first, successful compact SUV in India) was originally developed by Ford (Brazil) to satisfy the local market’s need for an inexpensive (yet rugged) SUV for South American roads (with poor road quality. In CY11, only 6% of all roads in Brazil were paved). To keep the cost low, the product was conceived on the Fiesta platform (compact). It was launched in Brazil in Jul’12 and subsequently in other emerging markets, India and China, in CY13. It was designed to differentiate target customers from others in their social circle owning other passenger vehicles. The vehicle was apt for an urban lifestyle and a quick getaway from the city. The success of Ford Ecosport started the trend of other OEMs in India designing and developing compact UVs based on compact car platform. Ford Ecosport
Exhibit 11. Share of SUVs within UVs Exhibit 12. Share of compact SUVs in SUVs
12% 11% 19% 19% 24% 9% 28% 11% 13% 34% 27%
35% 81% 76% 72% 46% 51% 32%
FY16 FY17 FY18 FY16 FY17 FY18 SUVs MPVs CSUVs Mid SUVs Premium SUVs Bolero
Source: JM Financial Source: JM Financial
JM Financial Institutional Securities Limited Page 6 Mahindra & Mahindra 18 April 2018 New definition of ‘success’: 4K monthly sales! Our analysis of the UV segment (from FY10) indicates that each successful model garnered a 9-13% share of the segment, in the past. However, the ability to capture this scale of market share with a new model is reducing each year due to competition, high growth and base of sales in UV segment. Hence, it would be best to ascertain future successes based on sales per month. We believe, excluding MSIL, any model across the passenger vehicle segments, having an average monthly sale of 4,000 units (+/-100 units), can be termed a ‘high success’ model. Our definition of ‘success’ stems from the following industry analysis:
Exhibit 13. Models with 4,000 sales a month (domestic) Industry % MSIL Industry excl. MSIL % Total Models 139 15 124 1. Only 8% of industry models consistently Models with <4,000 units (Domestic) 117 84% 3 114 92% sell 4,000 units per month. Models with >4,000 units (Domestic) 22 16% 12 10 8% 2. With limited success in the domestic Source: JM Financial, SIAM market, OEMs are increasingly tapping exports to increase model-wise sales. Exhibit 14. Models with 4,000 sales a month (Domestic + Exports) 3. With the inclusion of export sales, the Industry % MSIL Industry excl. MSIL % success ratio of models increases to Total Models 139 15 124 14%. Models with <4,000 units p.m. 110 79% 3 107 86% Models with >4,000 units p.m. 29 21% 12 17 14% Source: JM Financial, SIAM
Exhibit 15. Each ‘high success’ model helped gain 9 - 13% share in UVs, in the past MSIL Hyundai TTMT GM Ford Toyota Honda M&M Renault Others FY10 1.4% 0.0% 13.0% 6.0% 1.0% 19.7% 0.2% 55.3% 0.0% 3.4% FY11 1.8% 0.1% 13.2% 6.3% 1.0% 20.5% 0.2% 53.9% 0.0% 3.0%
FY12 1.8% 0.4% 13.3% 6.4% 0.6% 19.0% 0.1% 55.4% 0.1% 2.9% (1)
FY13 14.3% 0.1% 8.0% 3.8% 0.3% 16.9% 0.1% 47.7% (5) 7.1% 1.7% FY14 11.6% 0.1% 5.3% 5.5% (4) 8.7% 13.7% 0.2% 41.7% 8.9% 4.1% FY15 12.4% 0.3% 4.2% 3.9% 9.5% 14.6% 5.7% 37.5% 7.1% 4.8% (2) FY16 16.1% (6) 11.0% 3.1% 2.6% 7.1% 11.7% 1.5% 37.9% 4.8% 4.2% FY17 25.7% 12.9% 2.4% 1.7% 7.2% 12.1% (7) 3.5% 29.2% 3.1% 2.0% (3) (8) FY18* 28.3% 12.1% 5.4% 0.2% 6.2% 11.0% 6.7% 25.7% 2.1% 2.3% Source: JM Financial, SIAM
Exhibit 16. Details of mid/high success models from FY10 Market Share Before After Mkt. Sh. Avg. Model Parent Type Sub-Type Launch Success Launch launch Gain Sales (1) Ertiga MSIL MPV Compact Apr, 2012 1.8% 14.3% 12.5% High 5,500
(2) S-Cross MSIL SUV Crossover Aug, 2015 12.4% 16.1% 3.7% Medium 2,500
(3) Brezza MSIL SUV Compact Mar, 2016 16.1% 28.3% 12.2% High 12,500
(4) Ecosport Ford SUV Compact Jun, 2013 0.3% 9.5% 9.2% High 4,000
(5) Duster Renault SUV Mid Jul, 2012 0.1% 8.9% 8.8% High 1,000^
(6) Creta Hyundai SUV Mid Jul, 2015 0.3% 12.9% 12.6% High 9,000
(7) WRV Honda SUV Compact Mar, 2017 1.5% 6.7% 5.2% Medium 4,000
(8) Nexon Tata SUV Compact Sep, 2017 2.4% 8.4%* 6.0% High 4,500
Source: JM Financial, SIAM, *Based on annualised sales as Nexon was launched mid-year FY18. ^Peak sales were 4,000 + units, model due for a refresh
JM Financial Institutional Securities Limited Page 7 Mahindra & Mahindra 18 April 2018
Exhibit 17. M&M Product Plan
Source: Company
Exhibit 18. Upcoming M&M launches: 2 New SUVs + 1 MPV; 1 SUV Refresh (XUV500) SUVs
New Model
Compact MPVs
New Model
Industry Volume: 30,000+ p.m.
Entry Refresh
Industry Volume: 14,000+ p.m.
Premium Industry Volume: ~7,000 p.m. New Model
Premium
Source: JM Financial, Company
Exhibit 19. Value market share, FY18 (Indicative. Based on Ex-showroom prices) Compact SUVs 32% Mid-size SUVs 23% Premium SUVs 19% MPVs 21% Bolero 5% Source: JM Financial, SIAM JM Financial Institutional Securities Limited Page 8 Mahindra & Mahindra 18 April 2018
Compact SUVs: ‘Highest Volume + Fastest Growing’ segment in SUVs 12% 11% 19% After the success of Ford Ecosport, there has been a constant flow of new model launches in 9% 11% the Compact SUV (CSUV) segment. Being an alternative to mid-size sedans, CSUVs also offer 13% 27% an easy upgrade option for hatchback owners, as most CSUV models are priced sub-INR 1mn 34% (majority of CSUV models are <4 meters in length and qualify for a lower GST of 28% 35% (+1%/3% cess) vis-à-vis mid/full-size SUVs attracting a 45%+ duty). With ~50% of the households in India having 4 or fewer members, these 5-seater CSUVs offer a practical 46% 51% combination of utility and value for money. Due to this advantage, CSUVs now form over 32%
50% share of the SUV segment and 40% of the overall UVs in India. In FY18, CSUV sales FY16 FY17 FY18 stood at 375,000 units. CSUVs Mid SUVs Premium SUVs Bolero
Exhibit 20. Top-5 CSUVs Monthly Starting Avg. price Model Sales Price Pros and Cons (INR mn) (FY18) (INR mn)
0.73 Pros: Well proportioned styling, dual tone colour options, Maruti Suzuki Only high fuel efficiency, value for money, wide spread sales & 12,300 0.88 Vitara Brezza Diesel service network. Cons: Only Diesel, Interior Quality.
Pros: Unconventional but attractive styling, most value for money, spacious (and comfortable seating), option of Tata Motors 0.62 (P) 4,600 0.83 petrol and diesel Nexon 0.72 (D) Cons: Fit and finish not up to the mark, question on aftersales service.
Pros: Best-in-class styling, solid build and interior quality, Ford 0.78 (P) option of petrol and diesel. 4,000 0.98 Ecosport 0.84 (D) Cons: Expensive, thin network spread, unconventional cargo-door design, not so spacious, firm ride.
Pros: Aggressive styling, compact proportions, powerful diesel engine, well tuned suspension, Honda Brand. Honda 0.78 (P) 3,900 0.91 Cons: Not actually a compact SUV, more of a compact WR-V 0.89 (D) crossover; Unimpressive petrol engine and limited features.
Pros: Solid build and nice and roomy cabin. M&M 0.81 2,300 0.95 Cons: Design not to everyone's liking, bouncy ride, TUV300 Only Diesel mediocre NVH
Source: JM Financial, SIAM, all starting Ex-showroom prices for diesel models
Exhibit 21. Tivoli (UK) / M&M S201 Comparison Sheet Parameters Tata Nexon Ford Ecosport Maruti Brezza Tivoli UK / S201 Remarks 1) S201 expected to be less Length (mm) 3,994 3,998 3,995 4,195 than 4mtrs. 2) Better interior space due to Width (mm) 1,811 1,765 1,790 1,795 higher wheelbase 3) Other parameters, in line Height (mm) 1,607 1,647 1,640 1,590 with competition. Wheelbase (mm) 2,498 2,519 2,500 2,600 Kerb weight (kg) 1,225 1,261 1,190 1,430 Source: JM Financial JM Financial Institutional Securities Limited Page 9 Mahindra & Mahindra 18 April 2018
Exhibit 22. Tivoli (UK) Details Monthly Sales Starting Avg. price Model Pros and Cons (2017, UK) Price (GBP) (GBP) Pros: • Spacious and well equipped • Powerful Diesel Engine • Attractive styling 11,029 (P) Tivoli (UK) 4,600 15,000 • Nicely finished 12,279 (D) • Value for money Cons: • Unsettled ride • Weak petrol engine
Source: JM Financial
Auto Journalists’ Reviews: Fairly positive
“With Kia and Hyundai now threatening to outdo
established mainstream manufacturers (such as Vauxhall and Ford), the time has come for SsangYong (yet another South Korean manufacturer) to make its
mark in the UK. The SsangYong Tivoli is central to this
aim. It’s built on an all-new platform to compete with cars such as the Nissan Juke, Ford EcoSport and
the Vauxhall Mokka in the ever-popular (and still growing) small crossover market.”
— Carwow, UK. --Autocar, 2018
--The Telegraph, Oct, 2017
Exhibit 23. Price estimate of M&M S201 (Tivoli) using price difference between common models in UK and India
Hyundai i20 Suzuki Swift Ford Ecosport Ssangyong Tivoli Price in UK (GBP) 11,000 13,000 18,000 15,000 INR equivalent of UK Price 10,00,000 12,00,000 16,40,000 13,65,000 Price in India (INR) 6,50,000 6,50,000 9,00,000 8,20,000 Ratio of India to UK Price 65% 55% 55% 60%
Source: JM Financial
JM Financial Institutional Securities Limited Page 10 Mahindra & Mahindra 18 April 2018
Exhibit 24. Price Positioning of M&M S201 based on competition in India
INR 0.56mn Volumes KUV100
S201 Competitors M&M Portfolio
INR 0.72mn 4,600 Tata Nexon INR 0.72mn Bolero INR 0.73mn 12,300 Maruti Brezza Option 2: S201. Price: INR 0.78mn Target core volume segment. Garner 5,000 units p.m. Push TUV300 to rural.
S201
2,300 INR 0.81mn INR 0.81mn M&M TUV300 TUV300 4,000 INR 0.84mn Ford Ecosport Option 1: S201. Price: INR 0.87mn With good styling, features and space, tgt premium end. Garner 4,000 units.
S201
INR 0.89mn 3,900 Honda W-RV
4,400 INR 1.0mn Scorpio
Source: JM Financial, SIAM, all starting Ex-showroom prices for diesel models
Based on the current line-up of competition products, TUV300 & Scorpio and basis the derived price from the Tivoli (UK) model; there are two possible strategies to position the S201:
1) Option 1: Given the current position of TUV300 and Scorpio, it is best to position S201 between the two, with an introductory price matching or slightly higher than the Ford Ecosport, approx. around INR 0.87mn (diesel base model). The premium positioning with respect to highest selling Brezza and Nexon can be justified by better quality and spacious interiors, styling and more features. With this price positioning, it can gain potential customers from all high volume CSUVs but majorly from Ecosport and W-RV. The volume estimate at this price point can be 4,000 units per month, matching the current volumes of Ecosport and W-RV.
2) Option 2 (less likely option due to M&M’s portfolio line-up): The other more aggressive option would be to price it a little over MSIL Brezza, in the core volume segment of CSUVs (16,000 units per month), at an introductory price of INR 0.78mn (for diesel base model). In this case, the volumes can possibly reach 5,000 units per month, again taking share of all major models in the segment with major impact to Brezza and Nexon. As this positioning can directly impact TUV300, it can be moved to target more rural customers.
JM Financial Institutional Securities Limited Page 11 Mahindra & Mahindra 18 April 2018 Premium SUVs: ‘low volume but high value‘ 12% 11% 19% In terms of value market share, premium SUVs account for ~20% share of SUV segment. The 9% 11% latest and the most successful product here is the Jeep Compass with a starting price of INR 13% 1.6mn (diesel based model, ex-showroom) and highest selling variant approximately at INR 34% 27% 1.9mn. It is reporting monthly sales of 2,500 units, higher than M&M XUV and Toyota 35% Fotuner (both at monthly sales of 2,000+ units). Entry of Jeep Compass has brought down the average ex-showroom price of the premium SUV segment. Both, XUV500 and Jeep 46% 51% Compass, in the lower end of the premium SUV segment now account for 70% sales of 32% premium SUVs (~5,000 unit sales per month). Jeep Compass offered an attractive price point FY16 FY17 FY18 without any compromise on the ‘brand’ image. CSUVs Mid SUVs Premium SUVs Bolero
Exhibit 25. Top-4 Premium SUVs (In decreasing order of sales) Monthly Starting Price Avg. price Model Pros and Cons Sales (FY18) (INR mn) (INR mn)
Pros: Jeep brand, stylish design, solid build, FCA India 1.52(P) powerful 2.0L engine, disruptive pricing. Jeep 2,500 1.80 1.63(D) Cons: Thin dealership network, unknown after Compass sales quality, small size for the price.
Pros: Spacious seating, true SUV, highway M&M 1.28 (D); performance, value for money 2,200 1.60 XUV 500 Only diesel Cons: Dated looks, plastic quality could be better.
Pros: Toyota reliability, tough build, powerful diesel engine, contemporary design, user- Toyota 2.62 (P) 2,000 2.90 friendly cabin, good quality interiors, excellent Fortuner 2.78 (D) after sales quality. Cons: Expensive
Pros: All round SUV, solid build, feature loaded powerful diesel engine, 5-star safety. Ford 2.62 (D); 600 3.00 Cons: Expensive, limited variants, higher Endeavour Only diesel preference for Toyota brand in India., long waiting period.
Source: JM Financial, SIAM, all starting Ex-showroom prices for diesel models
Exhibit 26. M&M G4 Rexton Comparison Sheet Parameters Jeep Compass Rexton G4 Fortuner Endeavour Remarks 1) Bigger than Fortuner Length (mm) 4,404 4,850 4,705 4,892 2) Better Road Presence 3) More spacious than Width (mm) 1,760 1,960 1,840 1,860 others Height (mm) 1,656 1,825 1,850 1,837 Wheelbase (mm) 2,640 2,865 2,750 2,850
Kerb weight (Kgs) 1,537 2,095 2,135 1,879 Source: JM Financial
JM Financial Institutional Securities Limited Page 12 Mahindra & Mahindra 18 April 2018
Exhibit 27. G4 Rexton Monthly Sales Starting Avg. price Model Pros and Cons (2017, S.Korea) Price (GBP) (GBP)
Pros: Very good leathered interiors, easy to drive, tough G4 Rexton 27,500; and cheap , excellent brake 1750 31,000 hold, five year warranty (UK) Only Diesel Cons: less responsive steering
Source: JM Financial
Auto Journalists’ Reviews: Fairly positive
“We were genuinely surprised at how good the Rexton is. The combination of kit, styling, practicality and build quality is nothing short of remarkable; it would be impressive at twice, even three times the price” -- Editor, 4X4 Magazine
“Rexton is bigger than the likes of a Hyundai Santa Fe and has a very generous level of equipment.”—Honestjohn.co.uk, Oct, 2017
Best Value award, Off-Roaders class award and the overall 4X4 of the year award by experts from -- 4X4 Magazine
Exhibit 28. Price estimate of M&M New G4, using price of common models in UK and India
Suzuki S-cross Jeep Compass New G4 Price in UK (GBP) 15,000 28,000 28,500 INR equivalent of UK 13,85,000 26,00,000 26,30,000 price Avg price in India (INR) 10,00,000 18,00,000 18,80,000* Ratio of India to UK price 72% 75% 72%
Source: JM Financial, *diesel base model. Highest selling variant could be priced 2.1mn-2.2mn
JM Financial Institutional Securities Limited Page 13 Mahindra & Mahindra 18 April 2018
Exhibit 29. Positioning of G4
G4 Competitors Volumes (p.m.)
INR 1.00mn Scorpio M&M Portfolio
2,200 INR 1.28mn INR 1.28mn XUV500 M&M XUV500
2,500
INR 1.63mn FCA Jeep Compass M&M G4. Price: INR 1.88mn Similar to Endeavour & Fortuner but priced little over Compass. 1,800 units.
M&M G4
600 INR 2.62mn Ford Endeavour
2,000
INR 2.78mn Toyota Fortuner
Source: JM Financial, SIAM, all starting Ex-showroom prices for diesel models
Based on the current line-up of competition products, XUV500 and derived price from the Rexton G4 (UK) model, M&M-badged, India specific G4 should be positioned in the following manner to gain maximum traction:
Best possible option: Jeep Compass and Ssangyong Rexton are priced in a similar band in the UK. In India, maximum volumes in the premium SUV segment are at the lower end, just like the Compact SUVs. Jeep Compass is the new leader with 2,500 unit’s monthly sales. And, along with XUV500, these two cars account for 5,000 unit sales per month or 70% sales of the premium SUV segment.
There is a huge gap between Jeep Compass at INR 1.6mn and Ford Endeavour at INR 2.6mn and Toyota Fortuner at INR 2.8mn. The best strategy would be to position G4 little over the Jeep Compass, around INR 1.9mn (diesel base model). This would be the best way to undercut Fortuner and Endeavour models (given their strong brand image) and offer significant value proposition to potential G4 buyer. A car with the size and presence of Toyota Fortuner, but at a price little over Compass, would disrupt the premium SUV segment and help garner 1,800-2,000 unit sales per month for G4. This way, M&M will cover the entire spectrum of premium SUV segment, starting from XUV500 at the lower end to G4 in the mid-to-high end.
JM Financial Institutional Securities Limited Page 14 Mahindra & Mahindra 18 April 2018 MPVs: Smart ‘Family’ UVs The combination of versatility and space makes multi-purpose vehicles (MPVs) rank high in terms of the overall utility factor. These vehicles offer 7/8 seat option and with the 3rd row fold down, open a huge cargo bay area. MSIL Ertiga and Toyota Innova have been the highest success models in this segment with approx. 6,000 unit sales per month. However, being more than 4 metres in length, these vehicles attract GST of 45%+ unlike the 5-seater CSUVs. With emergence of nuclear families, drop in IT (BPO) activity, sales of CSUVs have outpaced MPV segment. Share of MPVs have fallen from 28% of UVs in FY16 to less than 20% in FY18. However, monthly sales of the MPV segment remain at a strong 14,000 units per month.
Exhibit 30. Share of SUVs within UVs Exhibit 31. Share of Compact SUVs in SUVs
12% 11% 19% 19% 24% 9% 28% 11% 13% 34% 27%
35% 81% 76% 72% 46% 51% 32%
FY16 FY17 FY18 FY16 FY17 FY18 SUVs MPVs CSUVs Mid SUVs Premium SUVs Bolero
Source: JM Financial Source: JM Financial
Exhibit 32. Top-3 MPVs (In decreasing order of sales) Monthly Starting Avg. price Model Sales Price (INR Pros and Cons (INR Lacs) (FY18) Lacs)
Pros: Comfortable, reliable, indestructible build, Toyota 14.2(P) spacious, flexible & practical cabin, powerful diesel 6,100 18.75 Innova Crysta 15.3(D) engines Cons: Expensive
Pros: Practical 7-seater family MPV at the price of a mid-size sedan, flexible seating & luggage options, Maruti 6.74 (P) excellent after-sales service & wide dealer network, 5,500 10.0 Ertiga 9.02(D) high fuel efficiency, value for money Cons: Build quality could be better. 3rd row seating space.
Pros: Tough build, road presence, comfortable ride 12.24 (D) Tata quality 1,100 Only 16.0 Hexa Cons: Concerns over long term reliability , poor Diesel after sales service, average performance
Source: JM Financial, SIAM, all prices in Ex-showroom
JM Financial Institutional Securities Limited Page 15 Mahindra & Mahindra 18 April 2018
Exhibit 33. Positioning of U321
U321 Competitors Volumes (per month) M&M Portfolio
5,500 INR 0.90mn Maruti Ertiga
M&M U321. Price: INR 1.05mn
Value for money, better styling & interiors drive sales of ~ 3,500 units
M&M U321
1,100 INR 1.22mn Tata Hexa
6,100
INR 1.53mn Toyota Innova
Source: JM Financial, all starting Ex-showroom prices for diesel models
Based on the current line-up of competition products and current line-up of M&M products, U321 should be positioned in the following manner to gain maximum traction:
Best possible option: So far, there have been only two successful models in the MPV segment, MSIL Ertiga at the lower end and Toyota Innova Crysta at the higher end, both with similar monthly sales at 5,500-6,000 units. Recent launch of Tata Hexa, starting price INR 1.25mn, has been met with a lukewarm response, even though it is fairly feature loaded, commands significant road presence and has a pliant ride quality. Our first impression of the U321 (based on the spy images) is that it is a bit smaller than the Hexa. Hence, it would be difficult to price it over the Hexa. The best option would be slot it between the MSIL Ertiga and Tata Hexa, ideally with a starting price of INR 1.05mn (diesel base variant), with the highest selling variant at INR 1.2mn (ex-showroom). With this positioning, it may garner ~3,500units per month.
JM Financial Institutional Securities Limited Page 16 Mahindra & Mahindra 18 April 2018
Model-wise volume projections for FY19 & FY20
Exhibit 34. Annual model-wise domestic volume projections (‘000 units) Model FY16 FY17 FY18 FY19E FY20E
Bolero 68 57 74 80 86
%growth -16% 31% 8% 8%
KUV100 14 36 26 23 20
%growth 151% -28% -8% -15%
TUV300 24 26 29 25 22
%growth 8% 11% -15% -10%
Bolero Plus 14 13 11 13 13
%growth -8% -10% 10% 5%
Thar 9 6 7 8 8
%growth -31% 18% 8% 8%
Xylo 7 7 7 7 5
%growth -9% 11% -10% -20%
Quanto 2 2 0 0 0
Scorpio 48 49 54 57 62
%growth 3% 9% 5% 10%
XUV500 36 27 25 29 27
%growth -26% -6% 12% -5%
Rexton/ New G4 (Jan’19)** 0 0 0 3 20 S 201 (Jun’18)** 0 0 0 35 56 U 321 (Sep’18)** 0 0 0 18 40 PCs* 3 3 1 1 1
Vans* 11 10 14 15 16 %growth -2% 31% 10% 8%
Total 236 236 248 311 378
%growth 0% 3% 26% 22% Source: JM Financial,SIAM, ** assumed launch
Exhibit 35. Estimated sales volume of M&M in PVs (‘000 units) Exhibit 36. Domestic monthly sales of M&M PVs (‘000 units)
400 378 31.5 20 350 311 40 26.0 300 18 56 35 20.7 250 19.7 200
150 261 236 248 255 100
50
0 FY17 FY18 FY19E FY20E
Existing Models S201 U321 New G4 FY17 FY18 FY19E FY20E
Source: JM Financial Source: JM Financial,SIAM
JM Financial Institutional Securities Limited Page 17 Mahindra & Mahindra 18 April 2018
Market leader in the Small Commercial Vehicles (SCVs) segment
Continued leadership in SCVs: M&M has been able to improve its market share in SCVs (up to 3.5T) from 32.6% (FY13) to 47.6% (FY18), primarily driven by the successful launch of Jeeto (Jun’15) and Supro-mini (Feb’17) in the <2T segment (where its market share increased from 12% in FY15 to 25% in FY18). In the 2-3.5T segment, M&M has been the market leader, on the back of a strong portfolio consisting of Imperio, Bolero pick-up, Camper, BMT plus and Supro Maxi.
E-commerce - New driver for SCVs: Historically, the SCV segment has been driven by demand for transportation of daily needs and to some extent industrial goods (fittings, pipes, etc). However, e-commerce and demand for last mile connectivity is now becoming an important demand driver. Retail e-commerce is likely to witness a 23% CAGR during FY18-FY20 and is likely to increase the demand for SCVs, especially 2-3.5T segment. Further, demand for SCVs is also supported by movement towards hub and spoke model, reinforced by implementation of GST. SCV growth has started to pick up from FY17 and as per our estimates, the SCV segment (Industry) is likely to post a 12- MM’s portfolio for <2 tonnes 15% CAGR, during FY18-FY20.
M&M to be a key beneficiary from increasing demand: The demand for 2-3.5T segment has been increasing at an 11% CAGR since FY15, driven by demand from e-commerce and traditional sectors. However, demand for <2T has only started to pick from FY18. M&M is the market leader in 2-3.5T segment and is likely to benefit from its market leadership. As a result, we believe that M&M can demonstrate a 15% CAGR in volume (FY18-FY20) in the SCV segment. Jeeto Supro-mini (1.5T, INR 0.29mn) (1.9T, INR 0.42mn) M&M is gaining market share in MHCV goods: MM has been able to increase its market share in the MHCV goods segment to 3.1%, FY18 (vs. 2.8%, FY17). Blazo trucks (launched-2016) are the key reasons for M&M’s market share gain. These trucks provide better fuel economy and comfortable cabins relative to other CV players. Given these factors, we expect MM to reach 3.7% market share during FY20.
Exhibit 37. Mkt share of M&M in <2T segment Exhibit 38. Mkt share of M&M in 2- 3.5T segment
7% 12% 15% 21% 19% 22% 21% 26%
72% 71% 67% 74% 83% 78% 84% 73% 69% 54% 64% 66% 61% 66%
24% 25% 25% 18% 21% 18% 14% 14% 15% 15% 15%
16% 12%
FY12 FY13 FY14 FY15 FY16 FY17
FY12 FY13 FY14 FY15 FY16 FY17
FY18* FY18*
MM TTMT Others AL EIM MM TTMT Others
Source: SIAM, JM Financial Source: SIAM, JM Financial
JM Financial Institutional Securities Limited Page 18 Mahindra & Mahindra 18 April 2018
Exhibit 39. Industry SCV sales (upto 3.5T, ‘000 units) Exhibit 40. E-commerce B2C sales in USD bn 450 60 438 430 52 50 410 Thousands 397 45 390 40 38 370 360 350 30 31
330 25 325 309 20 20 310 300 16 290 10 270
250 0 FY13 FY14 FY15 FY16 FY17 FY18 FY16 FY17 FY18 FY19E FY20E FY21E FY22E
Source: SIAM, JM Financial Source: JM Financial, Statistica Digital Market Outlook, 2017
Exhibit 41. Pick-up in LCV sales <2T, ‘000 units Exhibit 42. Steadily increasing sales of 2-3.5T segment, ‘000 units 300 300
250 247 250 244 Thousands Thousands 193 200 200 208
167 190 183 150 153 150 177 132 117 116 100 100
50 50
0 0 FY13 FY14 FY15 FY16 FY17 FY18 FY13 FY14 FY15 FY16 FY17 FY18
Source: SIAM, JM Financial Source: SIAM, JM Financial
Exhibit 43. M&M’s SCV domestic sales (‘000 units) Exhibit 44. M&M’s MHCV goods (‘000 units) and market share 300 16 3.7% 4.0% 3.4% 253 14 3.5% 250 3.1% 226 14 12 3.0% 200 2.6% 200 11 167 10 2.2% 2.5% 155 9 150 8 1.8% 2.0% 1.3% 1.4% 6 1.5% 100 7 6 4 1.0% 50 3 2 3 0.5% 2 - 0 0.0% FY16 FY17 FY18 FY19E FY20E FY13 FY14 FY15 FY16 FY17 FY18 FY19E FY20E
Source: JM Financial, SIAM Source: JM Financial, SIAM
JM Financial Institutional Securities Limited Page 19 Mahindra & Mahindra 18 April 2018
Undisputed leader in the Tractor segment
Continued leadership in the tractor market: M&M is the market leader in tractors with 43% market share. Leadership of M&M is supported by a strong product portfolio including NOVO (launched: Aug’14) and YUVO (launched: Apr’16). In FY18, the company registered 22% domestic volume growth, supported by the launch of JIVO (a sub 25hp tractor, launched: Apr’17) and Swaraj 963FE (60-75hp, launched: Feb’18). M&M’s leadership in tractors can also be attributed to a bouquet of services being offered by M&M such as crop care, seeds, etc.
Farm implements to drive demand for higher horsepower tractors: Globally, the level of farm mechanisation is well above that of India (40%). In developed regions such as USA and Western Europe, farm mechanisation is as high as 95-97%. Even within the BRIC nations, Brazil (75%), Russia (80%) and, China (63%) all have higher farm mechanisation levels than India (40%). In the long run, India is likely to increase its farm Level of farm mechanisation, 2017 mechanisation level from the current 40% to ~70%, driven by an increase in rural 97% 95% income, penetration of electricity and availability of easy credit. With the increase in 80% farm mechanisation, demand for farm implements such as rotavators is likely to 75% increase. However, to use farm implements such as rotavators, one requires a higher 63% horse power tractor. The share of tractors (40-50hp) has been increasing since FY11 (27%) to level of 49% (FY17). During, FY09-FY17, tractors (41-50hp) posted a CAGR of 40% 19% vs. 8% for the overall tractor industry. We expect the trend to continue and support the demand for higher hp tractors.
M&M to be a key beneficiary from demand of higher hp tractors: M&M has increased its market share in the 40-50hp category from 29% (FY11) to 45% (FY17). It is now the India US Western Brazil China Russia Europe market leader in this segment and 52% of total tractor volumes for M&M are from >40hp. Further, the average selling price (ASP) for tractors with 41-50hp and >50hp is Share of various HP tractors ~15-25% higher than tractors within the 31-40hp range. As a result, we believe that 6% 5% 6% the company’s tractor revenue could benefit going ahead. Further, a shift towards 12% 13% 7% 7% 13% 11% 11% 11% 9% higher hp is likely to be margin accretive, given the higher ASP of high hp tractors. 15% 15%
35% 37% 35% Shortening of replacement cycle: Replacement cycle of tractors has fallen to 6-7 years 36% 37% (vs. 15 years earlier), due to diversification in the usage of tractors. Tractors in rural areas 46% 46% are not only used for agriculture purposes but also for transportation, construction work and rental income. This has led to a reduction in their replacement cycle. 45% 49% 46% 46% 49% 27% 27% M&M to outpace industry growth: Rural income is likely to grow by low double digits in FY19. Further, the domestic tractor industry is likely to post an 8-10% 5-year CAGR. FY11 FY12 FY13 FY14 FY15 FY16 FY17 Driven by M&M’s leadership in high hp and overall tractors segments, we expect it to 40-50 HP 30-40 HP Upto 30 HP > 51 HP outpace industry volume growth, posting ~14% CAGR during FY18-FY20.
Exhibit 45. Share of OEMs in 40-50 hp tractors Exhibit 46. M&M’s domestic tractor volumes (‘000 units) 380 8% 8% 8% 7% 5% 368 16% 17% 7% 8% 7% 7% 8% 360 6% 7% 9% 10% 10% 12% 12% 340 334 13% 11% 10% 11% 12% 9% 9% 320 304 23% 23% 23% 22% 20% 26% 24% 300 280 7% 9% 260 250 43% 43% 43% 44% 45% 29% 30% 240
220 FY11 FY12 FY13 FY14 FY15 FY16 FY17 200 MM TAFE Escorts Sonalika John Deere Others FY17 FY18 FY19E FY20E
Source: SIAM, JM Financial Source: SIAM, JM Financial
JM Financial Institutional Securities Limited Page 20 Mahindra & Mahindra 18 April 2018 Financial Tables (Standalone)
Income Statement (INR mn) Balance Sheet (INR mn) Y/E March FY16A FY17A FY18E FY19E FY20E Y/E March FY16A FY17A FY18E FY19E FY20E Net Sales 4,08,754 4,37,853 4,83,196 5,67,634 6,60,887 Shareholders’ Fund 2,24,232 2,56,696 2,85,460 3,22,925 3,69,343 Sales Growth 7.3% 7.1% 10.4% 17.5% 16.4% Share Capital 2,963 2,968 5,936 5,936 5,936 Other Operating Income 0 0 0 0 0 Reserves & Surplus 2,21,269 2,53,728 2,79,524 3,16,988 3,63,407 Total Revenue 4,08,754 4,37,853 4,83,196 5,67,634 6,60,887 Preference Share Capital 0 0 0 0 0 Cost of Goods Sold/Op. Exp 2,95,162 3,18,027 3,44,519 4,03,588 4,69,891 Minority Interest 0 0 0 0 0 Personnel Cost 23,487 25,954 28,585 31,486 35,293 Total Loans 18,436 27,374 32,374 35,374 38,374 Other Expenses 43,902 46,180 49,286 57,899 67,410 Def. Tax Liab. / Assets (-) 4,601 6,949 7,510 8,198 9,015 EBITDA 46,202 47,693 60,806 74,662 88,293 Total - Equity & Liab. 2,47,268 2,91,019 3,25,344 3,66,496 4,16,732 EBITDA Margin 11.3% 10.9% 12.6% 13.2% 13.4% Net Fixed Assets 91,581 96,726 1,03,276 1,10,913 1,18,258 EBITDA Growth 23.9% 3.2% 27.5% 22.8% 18.3% Gross Fixed Assets 1,45,582 1,59,240 1,89,619 2,10,996 2,33,656 Depn. & Amort. 10,681 13,272 14,826 15,023 16,674 Intangible Assets 0 0 0 0 0 EBIT 35,521 34,421 45,980 59,639 71,619 Less: Depn. & Amort. 69,622 82,893 97,720 1,12,743 1,29,417 Other Income 8,499 13,425 11,661 11,161 12,157 Capital WIP 15,622 20,379 11,377 12,660 14,019 Finance Cost 1,861 1,456 1,500 2,050 2,050 Investments 1,35,474 1,79,022 1,93,022 2,13,022 2,33,022 PBT before Excep. & Forex 42,160 46,390 56,141 68,750 81,726 Current Assets 1,27,940 1,17,636 1,37,531 1,64,196 2,01,920 Excep. & Forex Inc./Loss(-) 0 0 0 0 0 Inventories 26,879 27,156 31,772 37,324 43,456 PBT 42,160 46,390 56,141 68,750 81,726 Sundry Debtors 25,116 29,185 33,096 38,879 45,266 Taxes 10,799 12,319 17,404 21,313 25,335 Cash & Bank Balances 22,870 16,870 24,344 31,230 47,110 Extraordinary Inc./Loss(-) 687 5,485 0 0 0 Loans & Advances 53,074 44,425 48,320 56,763 66,089 Assoc. Profit/Min. Int.(-) 0 0 0 0 0 Other Current Assets 0 0 0 0 0 Reported Net Profit 32,049 39,556 38,737 47,438 56,391 Current Liab. & Prov. 1,07,728 1,02,365 1,08,485 1,21,635 1,36,468 Adjusted Net Profit 31,361 34,072 38,737 47,438 56,391 Current Liabilities 66,780 71,581 78,692 91,841 1,06,675 Net Margin 7.7% 7.8% 8.0% 8.4% 8.5% Provisions & Others 40,948 30,784 29,793 29,793 29,793 Diluted Share Cap. (mn) 592.6 593.6 1,187.2 1,187.2 1,187.2 Net Current Assets 20,213 15,271 29,046 42,562 65,452 Diluted EPS (INR) 52.9 57.4 32.6 40.0 47.5 Total – Assets 2,47,268 2,91,019 3,25,344 3,66,496 4,16,732 Diluted EPS Growth 14.4% 8.5% -43.2% 22.5% 18.9% Source: Company, JM Financial Total Dividend + Tax 7,112 7,717 8,311 8,311 8,311 Dividend Per Share (INR) 12.0 13.0 7.0 7.0 7.0 Source: Company, JM Financial
Cash Flow Statement (INR mn) Dupont Analysis Y/E March FY16A FY17A FY18E FY19E FY20E Y/E March FY16A FY17A FY18E FY19E FY20E Profit before Tax 42,160 46,390 56,141 68,750 81,726 Net Margin 7.7% 7.8% 8.0% 8.4% 8.5% Depn. & Amort. 10,681 13,272 14,826 15,023 16,674 Asset Turnover (x) 0.8 1.6 1.6 1.6 1.7 Net Interest Exp. / Inc. (-) 1,861 1,456 1,500 2,050 2,050 Leverage Factor (x) 2.3 1.1 1.1 1.1 1.1 Inc (-) / Dec in WCap. 23,309 -1,059 -6,301 -6,630 -7,011 RoE 14.3% 14.2% 14.3% 15.6% 16.3% Others 687 5,485 0 0 0 Taxes Paid -10,799 -12,319 -17,404 -21,313 -25,335 Key Ratios Y/E March FY16A FY17A FY18E FY19E FY20E Operating Cash Flow 67,899 53,225 48,763 57,881 68,105 Capex -21,181 -18,416 -21,377 -22,660 -24,019 BV/Share (INR) 378.4 432.4 240.4 272.0 311.1 Free Cash Flow 46,718 34,809 27,386 35,221 44,086 ROIC 0.0% 29.3% 33.6% 38.4% 40.9% Inc (-) / Dec in Investments -4,093 -43,548 -14,000 -20,000 -20,000 ROE 14.3% 14.2% 14.3% 15.6% 16.3% Others -1,861 -1,456 -1,500 -2,050 -2,050 Net Debt/Equity (x) 0.0 0.0 0.0 0.0 0.0 Investing Cash Flow -27,134 -63,420 -36,877 -44,710 -46,069 P/E (x) 15.3 14.1 24.8 20.2 17.0 Inc / Dec (-) in Capital 6 5 2,968 0 0 P/B (x) 2.1 1.9 3.4 3.0 2.6 Dividend + Tax thereon -7,112 -7,717 -8,311 -8,311 -8,311 EV/EBITDA (x) 20.7 20.4 15.9 12.9 10.8 Inc / Dec (-) in Loans -7,768 8,939 5,000 3,000 3,000 EV/Sales (x) 2.3 2.2 2.0 1.7 1.4 Others -20,145 2,968 -4,069 -975 -845 Debtor days 22 24 25 25 25 Financing Cash Flow -35,019 4,194 -4,411 -6,285 -6,156 Inventory days 24 23 24 24 24 Inc / Dec (-) in Cash 5,747 -6,000 7,474 6,886 15,880 Creditor days 67 67 68 68 68 Opening Cash Balance 5,42,092 22,870 16,870 24,344 31,230 Source: Company, JM Financial Closing Cash Balance 5,47,839 16,870 24,344 31,230 47,110 Source: Company, JM Financial
JM Financial Institutional Securities Limited Page 21 Mahindra & Mahindra 18 April 2018 APPENDIX I
JM Financial Institutional Securities Limited (formerly known as JM Financial Securities Limited) Corporate Identity Number: U67100MH2017PLC296081 Member of BSE Ltd., National Stock Exchange of India Ltd. and Metropolitan Stock Exchange of India Ltd. SEBI Registration Nos.: –Stock Broker - INZ000163434, Research Analyst – INH000000610 Registered Office: 7th Floor, Cnergy, Appasaheb Marathe Marg, Prabhadevi, Mumbai 400 025, India. Board: +9122 6630 3030 | Fax: +91 22 6630 3488 | Email: [email protected] | www.jmfl.com Compliance Officer: Mr. Sunny Shah | Tel: +91 22 6630 3383 | Email: [email protected]
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