Mahindra & Mahindra market cap crosses ₹1.5 lakh crore after SUV sales and Scorpio-N bookings

• Shares of M&M hit an all time high of ₹1,248 after its strong sales number came in with a 33% jump in passenger vehicles in July.
• With this, the auto major’s market capitalisation crossed ₹1.5 lakh crore.
• Also, M&M’s all-new Scorpio-N saw 1 lakh bookings within 30 minutes of booking commencement.

Billionaire Anand Mahindra owned Mahindra & Mahindra’s shares jumped on Monday to hit an all-time high after the company released its July sales figures, reflecting strong demand for SUVs.

M&M was the top gainer on benchmark indices Sensex and Nifty50 as its stock went up by over 6%. After this rise, its market capitalization crossed ₹1.5 lakh crore leaving behind Tata Steel, Coal India, Power Grid Corp and Bajaj Auto.

The stock has outperformed the market and given good returns to investors this year.
Investors went all out buying the company’s stock after good sales seen in its SUV models -- XUV700, Thar, Bolero and XUV300. In July, the SUV segment of M&M sold 27,854 vehicles.

The company exported 2,798 vehicles during the month.

SUV play is key for M&M growth ahead
“M&M is the best rural proxy play, with two of the three core businesses on a strong footing. The company is reorienting its SUV business to maintain its DNA and brand position to garner market share. We expect a 16% volume CAGR in passenger UVs over FY22-24,” said analysts at Motilal Oswal.

Apart from its existing brands, the newly launched Scorpio-N received a robust one lakh orders in just three hours of opening bookings.

Analysts believe the launch of new SUV Scorpio-N is important for the automaker to recover its market share.

“Scorpio brand, which had a 14% market share in the utility vehicle (UV) market in FY12, had fallen to ~3% in FY22. The launch success of this model is critical in MM’s overall market share gains,” a report by Elara Capital.

Some believe the SUV model will be as successful as the automaker’s XUV700 and Thar. “In our opinion, the Scorpio-N is going to be another blockbuster model from Mahindra’s stable and would follow the success achieved by M&M’s recent launches (XUV700 and Thar),” said analysts at Phillip Capital.

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