Tried Valuation for M&M through SOTP:
Current MCAP: 90,000 cr
Conservative Valuation
Particulars Valuation Remarks
M&M+MVML 45000 4500 cr normal annualised PAT at 10x PE
TechM 18000 60% of current Market Value
M&M Finance 6000 60% of current Market Value
Mahindra Holidays 960 60% of current Market Value
Mahindra Lifespace 800 60% of current Market Value
Mahindra EPC 120 60% of current Market Value
Mahindra CIE 480 60% of current Market Value (11% Stake)
Mahindra Logistics 960 60% of current Market Value
Total 72,320
Current Market Cap 90,000
Upside / Downside -19%
Thoughts on business:
Expected recovery in Auto post Mahindra Thar
CV recovery to take time
Exit of Syyangong to improve Conso ROE
trying to assess Valuation model considering current market Cap:
Current Market Cap 90000
(-) Investments 27320 60% discount
Auto + Farm 62680 Derived PE of 14x
Considering PE of 20x for Farm + Auto business: there seems further upside of 30%
Target CMP on aggresive valuation of 945
Disc.: Invested