M&M rally fulfils Anand Mahindra's dream as stock hits all-time high

In a tweet, Mahindra recalled: "In 2019, M&M’s share price had fallen sharply from its all-time high of ₹984. In our annual leadership conference that year, I reminded our team of the late President (Abdul) Kalam’s advice when he inaugurated Mahindra Research valley: 'Take the Hill' he said, i.e, dare to dream."

M&M stock has rallied over 5 percent in the past week

The auto major, which has hit a market cap Rs 1.27 lakh crores, has seen brokerages raise their target price and earnings expectations.

Brokerages are enthused by the positive management commentary on improving rural market performance by the company. Reports say that the capital allocation strategy is working well and the next focus is on accelerating growth.

Moreover, there is a valuation comfort for the auto major as current valuations stand at 6.6X FY24 EV/EBITDA (enterprise value to earnings before interest, taxes, depreciation, and amortisation ratio) versus peers at 10-13X EV/EBITDA. Also, as and when the commodity cost pressures start to ease, it will aid margins going forward.