M&M Share Price Gains As Analysts See Limited Impact From Tesla's India Foray

Mahindra & Mahindra Ltd.'s share price gained on Monday, as analysts projected limited impact due to Tesla's potential India entry, which triggered a 15% decline in the stock in the last two weeks.

Jefferies pointed to the pricing differences and limited duty benefits for Tesla under current EV policies.

M&M's strong EV order book, representing a significant portion of India's EV sales, and attractive valuation, support the positive outlook, the brokerage said.

It reiterated a 'buy' rating for M&M, with a target price of Rs 4,075.

Besides, based on the provided figures, the concern about Tesla's competition significantly impacting M&M may be overstated. The estimated on-road price of a Tesla Model 3 in India, accounting for freight, import duties, road tax, and insurance, reaches approximately Rs 52 lakh.

In contrast, M&M's top-end XUV400 (XEV 9e) is priced at around Rs 32-33 lakh. This substantial price difference suggests that the two models cater to distinct market segments.

Nomura's dealer surveys indicate that M&M is experiencing continued order inflows for its EVs, signaling robust demand. This further supports the notion that M&M's position in the Indian EV market remains strong, and that the immediate competitive threat from Tesla, at its current projected pricing, may be less impactful than initially perceived.