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    of 14

    AKSHAT GALA : 31010423014 (12)

    BIKASH SINGH : 31010423092 (60)


    HET GORI : 31010423021 (66)
    AYUSH SONAR : 31010423068 (61)
    SOHAM KENIA : 31010423033 (21)
    YASHRAJ JOSHI : 31010423031 (20)
    COMPANY REPORTS:
    Mahindra&Mahindra
    CONTENTS

    1. INTRODUCTION
    2. SWOT ANALYSIS
    3. FINANCIAL INFORMATION 1
    4. LEVERAGE
    5. EBIT ANALYSIS
    6. COST OF CAPITAL
    7. COMPETITORS
    INTRODUCTION

    Mahindra & Mahindra (M&M) is an Indian multinational corporation, part of the Mahindra Group,
    headquartered in Mumbai. Established in 1945, M&M began as a steel trading company but quickly
    entered the automotive sector, becoming a leading manufacturer of utility vehicles, tractors, and
    electric vehicles. Over the years, it diversified into other sectors like aerospace, IT, and hospitality.
    Known for its innovation and global presence, M&M is a prominent player in both the Indian and
    international markets, particularly in the automotive and agricultural machinery industries.
    SWOT ANALYSIS
    Strengths:

    ● Market Leadership: Dominates India’s EV and commercial vehicle segments.


    ● Global Reach: Strong global presence through Jaguar Land Rover (JLR).
    ● Innovation: Significant investments in electric vehicles and alternative fuel technologies.

    Weaknesses:
    ● Dependence on JLR: A large portion of revenue is tied to JLR, exposing it to global
    economic risks.
    ● Profitability Volatility: Susceptible to fluctuating margins due to raw material costs and
    global conditions.
    Opportunities:
    ● Growing EV Market: Strong potential in India’s rapidly expanding EV sector.
    ● Sustainability Initiatives: Focus on green technologies like EVs and hydrogen
    vehicles aligns with global trends.

    Threats:
    ● Intense Competition: Faces strong competition from both domestic and
    international automakers.
    ● Global Economic Risks: Economic downturns in key markets like China and
    Europe could affect revenues​
    FINANCIAL INFORMATION
    SALES 1,03,157.85
    (AMOUNT IS IN RUPEE CRORE.
    - (VARIABLE COST) (81,680.84)
    DATA IS EXTRACTED FROM
    SCREENER.IN, MAHINDRA
    CONTRIBUTION. 21,477
    WEBSITE)
    - (FIXED COST) (7,855.27)

    EBIT. 13,482.96
    - (INTEREST) (138.77)

    EARNINGS BEFORE TAX 13,344.19


    - (TAX) (2,765.17)

    EARNINGS AFTER TAX. 10,579.02


    - (EPS)
    BASIC. (89.42)
    DILUTED. (89.04)
    LEVERAGE

    OPERATING LEVERAGE : EBIT/CONTRIBUTION = 62.77%

    FINANCIAL LEVERAGE : EBT/EBIT = 98.97%

    COMBINED LEVERAGE : EBT/CONTRIBUTION = 62.13%


    EBIT ANALYSIS
    Tata Motors' EBIT (Earnings Before Interest and Taxes) performance for FY24 reflects
    strong operational improvement across its segments. Here's a detailed analysis:

    1. Jaguar Land Rover (JLR):


    ○ For FY24, JLR's EBIT margin was 8.5%, driven by increased vehicle volumes,
    particularly in premium models like Range Rover and Defender, and reduced
    material costs. In Q4 FY24 alone, JLR's EBIT margin was 9.2%, showing a
    significant improvement year-over-year​

    This growth is supported by strong demand for luxury vehicles and the strategic
    transformation under JLR's "Reimagine" initiative, focused on electrification and
    premium offerings​
    Commercial Vehicles (CV) Segment:

    ● Tata Motors' CV segment posted an EBIT margin of 8.2% for FY24, up from the
    previous year. The EBIT margin in Q4 FY24 was 9.6%, a 100 bps improvement,
    reflecting cost optimization, improved vehicle mix, and strong demand

    Passenger Vehicles (PV) Segment:

    ● The PV segment showed an EBIT margin of 8.4% in FY24, benefiting from


    increased EV sales and Tata’s expanding portfolio in the electric vehicle space.
    The strong market position in India’s growing EV market, with a 73% market share,
    has contributed significantly to its EBIT growth
    COST OF CAPITAL
    The overall cost of capital for Mahindra&Mahindra is determined by its Weighted Average
    Cost of Capital (WACC), which accounts for both equity and debt financing costs. The cost
    of capital is influenced by the following factors:

    1. Cost of Equity: is estimated at 13.3%. This is calculated using the Capital Asset
    Pricing Model (CAPM), taking into account factors like the risk-free rate and the
    company's beta. The

    2. Cost of Debt: is around 5.75%, adjusted for the tax shield benefits from debt.

    3. The company's weighted average cost of capital (WACC) stands at 11.2%, which
    reflects the blended cost of both debt and equity financing.
    4. cost of preference shares: is not explicitly detailed in public sources, but typically,
    this cost reflects dividend payouts on preference shares, usually fixed based on the
    company's financial health.

    5. cost of retained earnings: is often considered equal to the cost of equity, which for
    M&M is around 13.3%. This cost reflects the opportunity cost for shareholders if
    earnings were distributed as dividends rather than reinvested into the company.
    COMPETITORS
    Tata Motors faces competition from several key players in the automotive industry:

    1. Mahindra & Mahindra: Competes in SUVs and commercial vehicles, with a growing focus on
    electric vehicles (EVs).
    2. Maruti Suzuki: The largest passenger car manufacturer in India, known for affordable and
    fuel-efficient models.
    3. Hyundai: Offers a wide range of passenger vehicles and is expanding its EV portfolio.
    4. Kia: Rapidly gaining market share with stylish designs and competitive pricing, particularly in
    the EV segment.

    These competitors create a dynamic environment for Tata Motors as it seeks to maintain its
    market position
    THANK YOU!

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