HSBC Upside Projection for M&M: Brokerage Maintains 'Buy' Rating Amid EV Momentum Surge
Mahindra & Mahindra Limited (M&M) shares remain a key focus for investors as brokerages maintain strong bullish views on the automaker's long-term prospects, driven primarily by accelerated electric vehicle (EV) trends and supportive government policies. HSBC recently maintained its ‘Buy’ rating on the stock, setting an aggressive target price of Rs 4,200, which suggests a potential upside of approximately 36 percent from current trading levels.Brokerage Bullishness Cites Strong EV Sector Positioning
M&M was observed trading at Rs 3,095.8, closing marginally up 0.1 percent for the day. Despite this minor gain, its shares have declined about 2.8 percent over the past year, falling short of the Nifty 50's 6.1 percent decline. The company maintains a substantial market capitalization of around Rs 3.7 lakh crore.HSBC highlighted that the penetration of EVs in the passenger vehicle segment has been increasing sharply. This trend significantly strengthens M&M’s competitive positioning within one of the domestic automobile market's fastest-growing segments. The brokerage is confident that M&M’s Original Equipment Manufacturer (OEM) margins will remain robust through FY27 and FY28, attributing this stability to a favorable product mix and expanding scale in their EV operations.
Delhi Government EV Policy Catalyzes Auto Stock Volatility
The auto sector experienced considerable volatility following the announcement of the revised EV policy by the Delhi government. This policy is expected to provide an additional tailwind for companies that have established offerings in the electric vehicle space.The policy mandates that only electric three-wheelers will be registered starting from January 1, 2027. Furthermore, it stipulates a transition where new two-wheeler registrations must become electric vehicles beginning April 1, 2028. This move is designed to significantly accelerate the national shift away from internal combustion engine vehicles.
Policy Incentives Expected to Boost Battery EV Manufacturers
Nomura emphasized that the Delhi government's new policy is set to benefit automakers with proven EV offerings. The brokerage indicated that the state intends to invest Rs 15,000 crore between FY27 and FY30. This investment will be channeled through a combination of tax concessions, charging infrastructure development, and various EV incentives.The government's stated focus has identified M&M, Tata Motors' passenger vehicle business, Ather, and Sona BLW Precision Forgings as primary beneficiaries of this substantial policy package. Nitant Darekar, Research Analyst at Bonanza, noted that the Rs 15,000 crore incentive package, which specifically excludes strong hybrids, is tailored to benefit battery electric vehicle manufacturers. Companies such as TVS Motor and Bajaj Auto are also cited by analysts who anticipate gains from a replacement cycle driven by enhanced EV adoption and scrappage incentives.
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