Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Settings
Settings
Dynamic quotes 
OFFON

MarketScreener Homepage  >  Equities  >  NSE India Stock Exchange  >  Mahindra and Mahindra Ltd    M&M   INE101A01026

MAHINDRA AND MAHINDRA LTD

(M&M)
  Report
SummaryQuotesChartsNewsRatingsCalendarCompanyFinancialsConsensusRevisions 
SummaryMost relevantAll NewsAnalyst Reco.Other languagesPress ReleasesOfficial PublicationsSector newsMarketScreener Strategies

From small businesses to farmers, middle India is driving demand

11/29/2020 | 02:25am EST
FILE PHOTO: Workers stitch garments at a factory of an apparel shop in Jaipur

NEW DELHI/MUMBAI (Reuters) - Manish Mehra, owner of Washex Hospitality, an industrial laundry service, recently flew from Delhi to Jodhpur, a city in north-western India, to win a contract to service a large, government-run hospital - a move essential to kickstarting his business.

"For a new relationship it is essential to know each other before you can establish the trust and confidence to work online and that need is higher in case of government departments," said Mehra, who had to stay for a week in a Jodhpur hotel.

Increased demand for air travel and hotel stays by small business owners like Mehra, accompanied by a rise in rural incomes and spending after two good monsoons, is helping the pandemic-hit Indian economy slowly recover.

Government data released on Friday showed the economy shrank 7.5% in the July-September quarter, performing better than analysts' expectation of an 8.8% contraction as lockdowns were eased and some pent-up demand was met. In the April-June period, the economy shrank 23.9%.

Annual growth of 3.4% in farm sector and 0.6% in manufacturing during the September quarter has raised hopes of an early recovery and some service sectors such as trade, hotels and transport contracted at a much slower pace compared with the April-June period.

Farmers, benefiting from a bumper crop, are lapping up tractors while demand for personal vehicles, due to a lack of public transport and the need for safer travel options, has boosted sales of cars and motorcycles.

There has also been an uptick in goods and services, tax collections and higher energy consumption.

A recovery is taking shape and it has been led by the manufacturing sector which has moved from near annihilation in the July quarter to rebound mode, said Yuvika Singhal, an economist at QuantEco Research.

"Until there is a stronger recovery in high contact service sectors, which make up 60% of the GDP, agriculture and manufacturing are expected to carry the growth," said Singhal, adding that India is still growing on a lower GDP base and it will take more than a year to recover lost output.

SLOW START FOR HOTELS, AIRLINES

A string of Marriot hotels in industrial towns like Sriperumbudur, Visakhapatnam and Nasik are operating at 50% to 60% occupancy with the bulk of guests working with domestic manufacturing companies, said Ashish Jakhanwala, CEO of hospitality firm SAMHI which owns the properties.

Meanwhile SAMHI's hotel in the tech-city of Bengaluru, that mainly depends on large corporates, is filling only 20% to 30% of rooms.

"Demand from large corporates and international travel will take longer to recover. Hotels catering to public sector and infrastructure companies are doing better," said Jakhanwala.

Since the end of May, when the government lifted a ban on flights, monthly domestic passenger traffic has more than doubled from 2 million in June to over 5 million in October. But that is still down from about 12 million a year ago.

India's biggest carrier IndiGo and rival Vistara are seeing an uptick in business travel but to a much smaller extent than before.

"Much of it is from small and medium enterprises (SMEs) or small business owners who cannot afford to sit at home," said Vinod Kannan, chief commercial officer at Vistara, a joint venture between Singapore Airlines and Tata Group.

SMEs have contributed to a 35% to 40% recovery in hotel bookings compared with pre-COVID times and between 27% and 32% recovery in flights, according to online travel agency MakeMyTrip.

RURAL REVIVAL ROBUST

In the hinterlands, the impact of COVID-19 has not been as severe as in the big cities and farmers have benefited from good rainfall for two consecutive years leading to a bumper harvest and adequate conditions for winter-sown crops. This is driving up sales for tractor makers like Mahindra & Mahindra.

Lack of adequate and safe public transport in small towns and villages has also pushed up demand for cars and motorcycles.

Maruti Suzuki, India's biggest carmaker, had a 10% growth in rural sales between July and September versus a 4% rise overall, led by small, entry-level models, said Shashank Srivastava, executive director, marketing and sales.

"While Bharat (rural India) is leading India in terms of a recovery, it cannot carry India," he said, adding that steady, long-term demand will depend on improving economic factors, growing incomes and a rebound in urban markets.

(Reporting by Aditi Shah in New Delhi and Rajendra Jadhav in Mumbai, additional reporting by Rupam Jain in Mumbai; Editing by Raju Gopalakrishnan)

By Aditi Shah and Rajendra Jadhav


© Reuters 2020
Stocks mentioned in the article
ChangeLast1st jan.
MAHINDRA AND MAHINDRA LTD -1.22% 798.4 Delayed Quote.12.16%
MAKEMYTRIP LIMITED -1.01% 31.27 Delayed Quote.6.98%
MARUTI SUZUKI INDIA LTD -0.35% 8048.85 Delayed Quote.5.58%
SINGAPORE AIRLINES LIMITED -2.08% 4.24 End-of-day quote.-0.93%
All news about MAHINDRA AND MAHINDRA LTD
01/18MAHINDRA AND MAHINDRA : Maruti Suzuki India to hike prices due to higher costs
RE
01/18Indian companies consider buying vaccines for employees
RE
01/13EXCLUSIVE : Indian automaker Mahindra cuts over half of North America workforce,..
RE
01/13Indian automaker Mahindra cuts over half of North America workforce - sources
RE
01/13MAHINDRA AND MAHINDRA : & Reduces North American Labor Force, Reuters Reports
DJ
01/11MAHINDRA AND MAHINDRA : Ford to close Brazil manufacturing operations, take $4.1..
RE
01/11MAHINDRA AND MAHINDRA : announces price increase for its Personal & Commercial r..
AQ
01/10MAHINDRA AND MAHINDRA : & Implements Price Hike Across Car Models
MT
01/05MAHINDRA AND MAHINDRA : Farm Equipment Sector Sells 21,173 Units in India during..
AQ
01/04Indian Indices Close Higher on Monday; Tata Consultancy Services Jumps 4%
MT
More news
Financials
Sales 2021 431 B 5 911 M 5 911 M
Net income 2021 30 365 M 416 M 416 M
Net cash 2021 30 040 M 412 M 412 M
P/E ratio 2021 29,2x
Yield 2021 0,64%
Capitalization 858 B 11 751 M 11 753 M
EV / Sales 2021 1,92x
EV / Sales 2022 1,56x
Nbr of Employees 256 000
Free-Float 71,3%
Chart MAHINDRA AND MAHINDRA LTD
Duration : Period :
Mahindra and Mahindra Ltd Technical Analysis Chart | M&M | INE101A01026 | MarketScreener
Technical analysis trends MAHINDRA AND MAHINDRA LTD
Short TermMid-TermLong Term
TrendsBullishBullishBullish
Income Statement Evolution
Consensus
 
Mean consensus -
Number of Analysts
Average target price
Last Close Price 798,40 
Spread / Highest target -
Spread / Average Target -
Spread / Lowest Target -
EPS Revisions
Managers and Directors
NameTitle
Pawan Kumar Goenka Chief Executive Officer, Executive Director & MD
Anand Gopal Mahindra Non-Executive Chairman
Anish Dilip Shah Deputy MD, Chief Financial Officer & Director
Mohit Kapoor Chief Technology Officer & Executive VP
Keshub Kailash Mahindra Chairman-Emeritus
Sector and Competitors
1st jan.Capitalization (M$)
MAHINDRA AND MAHINDRA LTD12.16%11 900
TOYOTA MOTOR CORPORATION-3.73%209 114
VOLKSWAGEN AG6.31%103 225
GENERAL MOTORS COMPANY32.28%78 836
DAIMLER AG2.16%76 710
BMW AG-1.32%55 895