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Business overview:

MM is a leading player in India's automotive and farm equipment sectors, with a strong presence in SUVs, tractors and electric vehicles, supported by the launch of new EV models. MM benefits from its strong brand equity, an extensive distribution network and tech-driven mobility solutions. In Q1FY26, MM reported revenue of INR 341,4Bn with an EBITDA margin of 14.0%. Revenue is expected to expand at a CAGR of 20.0% over FY25–28E, supported by sustained rural demand, an expanding EV portfolio and a growing SUV segment.

Could MM sustain its growth and emerge as a MUV segment leader?

MM has demonstrated impressive growth, with a CAGR of 37.2%, from FY21 to FY25 in MUV sales, reaching 5,51,487 units. Its MUV market share has moved from 14.7% in FY21 to 19.7% in FY25 and 22.7% in Q1FY26, indicating a strong upward trajectory. MSIL is the leader with a market share of 24.2% in Q1FY26, while it improved from 21.6% in FY21 to 25.7% in FY25. Additionally, MSIL has expanded with 33.2% CAGR in MUV sales, reaching 7,20,186 units in the same period. While MM is sustaining its growth, it will be a challenge to emerge as the leader in the SUV space in the near term, given MSIL’s superior volume and new model launches.

Is MM’s farm equipment market share growing; can it sustain its leadership?

MM has steadily increased its market share, from 38.2% in FY21 to 43.3% in FY25, showcasing consistent growth. With its closest competitor, Sonalika International, holding less than 15% market share, M&M faces no immediate threat to its leadership. The widening gap indicates MM’s dominance is strengthening, supported by its strong product portfolio and market reach. MM’s revenue share from the Farm Equipment Segment (FES) stands at ~27% as of Q1FY26, ensuring a stable contribution to its overall revenue.

Will MM’s new EV launches significantly improve its overall passenger vehicle sales?

In FY25, EVs accounted for 1.5% of M&M’s SUV volumes (8,392 out of 5,51,487 units). However, with the launch of the BE 6 and XEV 9e, the monthly EV sales have increased to ~4,000 units. This has lifted the EV penetration to ~8% of SUV volumes, reflecting a significant push towards electrification, particularly in the premium segment. This positions MM for long-term growth in the EV space, which is growing faster than ICE.

What makes MM a standout investment in India's automobile industry?

MM has strengthened its position in India’s auto industry with consistent market share gains in key segments. As of Q1FY26, the company has expanded its MUV market share to 22.7%, capitalising on the rising demand for utility vehicles. In the commercial segment, MM leads with a 45.5% market share in the LCV segment. Additionally, MM’s tractor market share has reached 45.2% in Q1FY26, highlighting its stronghold in rural as well as agricultural sectors. With a well-diversified portfolio across high-growth categories, MM is well-positioned to sustain its growth momentum and capitalise on evolving consumer preferences.

Recommendation: We maintain a positive outlook on MM, maintaining our ‘BUY’ rating, with a TP of INR 4,450.

Key Risks:

* Competition risk: Increased competition in the EV and SUV segments, tech-driven mobility startups and global automakers intensifies pricing pressure and the need for continuous innovation.

Revenue expected to grow 20.0% CAGR over FY25–28E

EBITDA Margin to stabilize at 15%

MUV market share on rise

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