FUNDAMENTAL ANALYSIS OF MAHINDRA&MAHINDRA

EXECUTIVE SUMMARY
India's domestic automotive industry, enjoyed high growth in financial year05, continuing the healthy trend set in financial year-04. Increased industrial growth contributed to the upward trend. All the automotive industry segments in which M&M has a presence witnessed a growth in demand in financial year-05. The Indian tractor industry too saw an upward trend after a severe downturn period, due to favorable monsoon and better credit terms helped to build positive sentiments. The major players in the Commercial Vehicle Segment are Ashok Leyland Ltd, Hindustan Motors Ltd, Telco, Volvo India Pvt.Ltd, Bajaj Tempo Ltd, Eicher Motors Ltd, Mahindra & Mahindra Ltd, and Swaraj Mazda Ltd. Mahindra & Mahindra Limited (M&M) is the flagship company of around Rs. 8000 crore Mahindra Group, which has a significant presence in key sectors of the Indian economy. A consistently high performer, M&M is one of the most respected companies in the country. Set up in 1945 to make general-purpose utility vehicles for the Indian market, M&M soon branched out into manufacturing agricultural tractors and light commercial vehicles (LCVs). The company later expanded its operations from automobiles and tractors to secure a significant presence in many more important sectors. The company has, over the years, transformed itself into a Group that caters to the Indian and overseas markets with a presence in vehicles, farm equipment, information technology, trade and finance related services, and infrastructure development. Mahindra & Mahindra Ltd (M&M) is a leading player in the Indian utility vehicles and tractors segment with market shares of 49.5% in Jeeps / MUVs, 30.9% in 3-wheelers, and market share of 25.9% in Tractors in the FY2005. This study tries to cover the industry related data and in depth company study and an overview of the economy, evaluates the company on various valuation models.

FUNDAMENTAL ANALYSIS OF MAHINDRA&MAHINDRA

COMPANY PROFILE:
Mahindra & Mahindra Limited (M&M) is the flagship company of around US $ 2.5 billion Mahindra Group, which has a significant presence in key sectors of the Indian economy. A consistently high performer, M&M is one of the most respected companies in the country. Set up in 1945 to make general-purpose utility vehicles for the Indian market, M&M soon branched out into manufacturing agricultural tractors and light commercial vehicles (LCVs). The company later expanded its operations from automobiles and tractors to secure a significant presence in many more important sectors. The Company has, over the years, transformed itself into a Group that caters to the Indian and overseas markets with a presence in vehicles, farm equipment, information technology, trade and finance related services, and infrastructure development. M&M has two main operating divisions: 1) The Automotive Division manufactures utility vehicles, light commercial vehicles and three wheelers. 2) The Tractor (Farm Equipment) Division makes agricultural tractors and implements that are used in conjunction with tractors, and has also ventured into manufacturing of industrial engines. The Tractor Division has won the coveted Deming Application Prize 2003, making it the only tractor manufacturing company in the world to secure this prize. The resurgence of the automotive industry and M&M's success in exploiting it, has created an opportunity to strengthen the company through an entry into the Auto Components business, the growth of which is being fueled by both, domestic and export demand.

FUNDAMENTAL ANALYSIS OF MAHINDRA&MAHINDRA

M&M employs around 11,500 people and has six state-of-the-art manufacturing facilities spread over 500,000 square meters. M&M has also set up two satellite plants for tractor assembly. It has 49 sales offices that are supported by a network of over 780 dealers across the country. This network is connected to the Company's sales departments by an extensive IT infrastructure. M&M's outstanding manufacturing and engineering skills allow it to constantly innovate and launch new products for the Indian market. The Company's significant recent product launch, the "Scorpio", resulted in the Company winning the National Award for outstanding inhouse research and development from the Department of Science and Industry of the Government in 2003. The Company has launched India's first tractor with turbo technology - the Mahindra Sarpanch 595 DI Super Turbo. The Company's commitment to technology-driven innovation is reflected in Company's plans of setting up of the Mahindra Research Valley, a facility that will house the Company's engineering research and product development wings, under one roof. The M&M philosophy of growth is centered on its belief in people. As a result, the company has put in place initiatives that seek to reward and retain the best talent in the industry. M&M is also known for its progressive labour management practices. In the community development sphere, the company has implemented several programs that have benefited the people and institutions in its areas of operations.