Mahindra & Mahindra Ltd (M&M) shares zoomed Tuesday on speculation that the company will be issuing bonus shares soon. Against its capital of Rs272.62 crore, M&M has free reserves of about Rs4,673.75 crore.
During the day, the share made a new 52-week high of Rs1,176 and was trading at Rs1,151, up 2% from Monday’s (4th January) close. On 4 January 2009 the stock had shot up 5% after the company reported 122% rise in its domestic sales to 22,754 units in December 2009 as against 10,253 units in December 2008, an increase of 2.22 times.
During December, M&M, the country’s largest utility vehicle maker, sold a total of 24,001 vehicles (domestic plus exports), as against 11,172 vehicles sold in December 2008.
The company financials have been restated to incorporate the figures of M&M’s one-time subsidiary Punjab Tractors Ltd which merged with the company. Hence in the September 2009 quarter, the company posted revenues of Rs4,557.77 crore and an operating profit of Rs608.97 crore against revenues of Rs3,137.96 crore and operating profit of Rs185.32 crore in the September 2008 quarter. Based on the expected EPS of Rs69.47 and the current price, the stock is quoting at a P/E of 16.26. — Swapnil Suvarna