Mahindra & Mahindra (MAHM.BO): Truck and Bus Division (MTBD) To Be Sold to SML Mahindra

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Mahindra & Mahindra (MAHM.BO): Truck and Bus Division (MTBD) To Be Sold to SML Mahindra

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29 Jul 2026 11:08:59 ET │ 13 pages

Mahindra & Mahindra (MAHM.BO)

Truck and Bus Division (MTBD) To Be Sold to SML Mahindra

CITI'S TAKE

Buy M&M's Board has approved the sale of the company’s truck and bus

division (MTBD) to its listed subsidiary SML Mahindra. MTBD would be Price (29 Jul 26 15:30) Rs3,223.15

sold as a going concern on a slump sale basis for a cash consideration of Target price Rs4,470.00

Rs5.25bn, subject to working capital adjustments and shareholder Expected share price return 38.7%

approval. The transaction is intended to consolidate Mahindra Group’s Expected dividend yield 1.1%

truck and bus businesses under a single entity, creating a CV portfolio Expected total return 39.8%

spanning light, intermediate and heavy trucks, and buses. The company

Market Cap Rs3,871,328M expects a simplified operating structure, greater scale, operational

US$40,386M synergies, broader market coverage and improved competitiveness. M&M

will continue to manufacture MTBD products as a contract manufacturer.

The business transfer agreement will be executed on or before 7-Aug-

2026 and proposed sale to be consummated on or before 31-Jan-2027, Arvind SharmaAC

subject to approvals and satisfaction of conditions precedent. The +91-22-6175-9852

combined entity should benefit from scale, broader portfolio, and arvind1.sharma@citi.com

enhanced market reach. Maintain Buy.

Sanchit Chandna

+91-22-6175-9824

Financial implication: M&M's standalone revenue will decline slightly as MTBD sanchit.chandna@citi.com

contributed ~2% of M&M’s FY26 revenue. However, the impact on M&M stock’s fair

value should be limited because M&M will continue to benefit from the overall CV