Mahindra & Mahindra: Shares with low volatility and risk

K. ARAVIND

 

Mahindra & Mahindra Ltd., which is present in over 100 countries around the world, has over two lakh employees. Mahindra Group operates in 20 major industries. Mahindra & Mahindra, the group’s flagship company, generates revenue mainly from the manufacture of vehicles and agricultural equipment. Mahindra is the largest tractor manufacturer in the world.

 

Mahindra, one of the largest automakers in the country, has a 55 per cent market share in the utility vehicle market. The major subsidiaries are Mahindra & Mahindra Financial Services (Rural Finance), Tech Mahindra (IT) and Mahindra Life Space Space Developers (Real Estate).

 

Bringing product diversity through acquisitions has contributed to the growth of the company. This diversity will be of great benefit to the company in the future. Mahindra & Mahindra acquired Reva Electronics amid growing demand for alternative energy vehicles in the world. Mahindra & Mahindra acquired SsangYong Motor in the wake of huge growth in SUV sales in emerging markets. This has been very beneficial for Mahindra & Mahindra.

 

Mahindra & Mahindra will benefit from better rainfall this year and improved income of people in rural areas. Increasing the minimum support price for agricultural products is expected to lead to more tractor sales. The company is focused on increasing revenue by increasing sales volume. The company has also improved production in response to increased demand in the automobile and farm equipment sectors. Sales of SUV and UV segment vehicles are also likely to improve.

 

The stock is likely to offer a good return to investors this year in anticipation of good returns. For those who want to invest in the automobile sector, Mahindra & Mahindra is a stock that is often bought with a long-term goal.