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Mahindra & Mahindra Financial Services Ltd. Stock Analysis

Large Cap
Evaluated by 4075 users | BSE: 532720 | NSE: M&MFIN |
Finance - NBFC

Mahindra & Mahindra Financial Services (Mahindra Finance) began as a captive financier of Mahindra Utility Vehicles in the early 90s. From Mahindra UVs to tractors to non-Mahindra products, the company has diversified into a financial services...

1. Right Stock
Very Good
2. Right Price
3. Right Time

Analysis of Financial Track Record

Data adjusted to bonus, split, extra-ordinary income, rights issue and change in financial year end
Financial track record gives insight into the company's performance on key parameters over the past ten years. MoneyWorks4me’s proprietary colour codes make it easy for retail investors to gauge the company’s past performance.
Mahindra & Mahindra Financial Services Ltd. has performed well in majority of the past ten years indicating its past ten year financial track record is very good
 Mar'11Mar'12Mar'13Mar'14Mar'15Mar'16Mar'17Mar'18Mar'19Mar'20
Operating Income (Rs. Cr.)2,0262,8894,0955,2756,0216,5547,1467,88410,37211,883
Y-o-Y Gr. Rt.-42.6%41.7%28.8%14.1%8.9%9%10.3%31.6%14.6%
Adjusted EPS (Rs.)
Adjusted Earning per Share is the company’s net profit per share after adjusting for extra-ordinary/exceptional items
5.877.6410.0410.339.878.345.5211.7618.1210.65
Y-o-Y Gr. Rt.-30.2%31.4%2.9%-4.5%-15.5%-33.8%113%54.1%-41.2%
Book Value per Share (Rs.)
The total value that a company will fetch upon liquidation (if it is closed down), after settling all obligations is called its Book Value. Book value of a company includes only tangible assets. Book value allocated to each outstanding share is called Book Value per share
30.2735.9249.5257.1964.0669.6174.8597.58111.4118.08
Y-o-Y Gr. Rt.-18.7%37.9%15.5%12%8.7%7.5%30.4%14.2%6%
To view Net Profit/Total Funds (%) Colour Rating Guide click here
Net Profit/Total Funds (%): Colour Rating Guide
  • >1.25 : Very Good
  • 1-1.25 : Somewhat Good
  • <1: Not Good
Net Profit/Total Funds (%)4.283.924.033.192.571.911.092.152.761.34
Standalone financials take only the parent company into account while consolidated financials take into account financials of the parent company as well as of all its subsidiaries. In most companies consolidated financials should be used for analysis.
Mahindra & Mahindra Financial Services Ltd. should be analysed on a Consolidated basis
CAGR
CAGR Colour Code Guide
  9 yrs 5 yrs 3 yrs 1 yr
Operating Income21.7%14.6%18.5%14.6%
Adjusted EPS
Adjusted Earnings per Share is the Company’s net profit per share after adjusting for extra-ordinary/exceptional items.
6.8%1.5%24.5%-41.2%
Book Value per Share
16.3%13%16.4%6%
Share Price 8.5% 3.7% -14.2% -20.3%
Key Financial Ratios
RATIOS \ YEARSMar'11Mar'12Mar'13Mar'14Mar'15Mar'16Mar'17Mar'18Mar'19Mar'20
Asset Quality Ratio
To view Asset Quality Ratio Colour Rating Guide click here
Asset Quality Ratio: Colour Rating Guide
  • <0.5 : Very Good
  • 0.5-1 : Somewhat Good
  • >1 : Not Good
Net NPA to Net Advances (%)0.60.7122.63.544.100
Capitalization Ratio
To view Capitalization Ratio Colour Rating Guide click here
Capitalization Ratio: Colour Rating Guide
  • >17% : Very Good
  • 15%-17% : Somewhat Good
  • <15% : Not Good
Capital Adequacy Ratio (%)20.31817.516.318.317.317.221.900
Margins
Net Profit Margin (%) 24.3722.3122.6818.2915.3612.017.4115.0417.558.75
Performance Ratios
To view Performance Ratios Colour Rating Guide click here
Performance Ratios: Colour Rating Guide
  • >15 : Very Good
  • 12-15 : Somewhat Good
  • <12 : Not Good
Return on Equity (%) 22.9823.1624.4619.5816.512.737.9214.1417.288.99
Corporate Governance What do we look at?
Corporate Governance
Board Credentials
Promoter's holding
Transparency
Integrity
Entity Percentage Holding
Promoters 52.16%
Institutions 33.86%
Non-Institutions 13.98%
Pledged *0.000.000.000.000.000.000.000.000.000.00
* Pledged shares as % of Promoter's holding (%)

MoneyWorks4Me analysed the past 10-year performance of Mahindra & Mahindra Financial Services Ltd. and arrived at the following conclusion:

Past 10 year's financial track record indicates that Mahindra & Mahindra Financial Services Ltd. is a good quality company. However, for specific investment actions please connect with your investment advisor.

The 5-year analysis of Mahindra & Mahindra Financial Services Ltd.'s performance infers:

Mahindra & Mahindra Financial Services Ltd. earnings have grown by 1.5%, whereas share price has appreciated 3.7% CAGR over the past five years, indicating the company's share price is likely overvalued. However, for specific investment actions please connect with your investment advisor.

We analysed the performance of Mahindra & Mahindra Financial Services Ltd. share prices over the last 10 years. Here is what we found out:

Mahindra & Mahindra Financial Services Ltd. share price has appreciated 5.9% annually over the past ten years.

Mahindra & Mahindra Financial Services (Mahindra Finance) began as a captive financier of Mahindra Utility Vehicles in the early 90s. From Mahindra UVs to tractors to non-Mahindra products, the company has diversified into a financial services provider with a whole suite of financial solutions tailored to the under-served customer in under-penetrated rural markets. The equity shares of the Company are listed on the National Stock Exchange (NSE) and the

Mahindra & Mahindra Financial Services (Mahindra Finance) began as a captive financier of Mahindra Utility Vehicles in the early 90s. From Mahindra UVs to tractors to non-Mahindra products, the company has diversified into a financial services provider with a whole suite of financial solutions tailored to the under-served customer in under-penetrated rural markets. The equity shares of the Company are listed on the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE) in India. The Company is a subsidiary of Mahindra & Mahindra.

Its product portfolio consists of vehicle finance, which includes financing of passenger vehicles, utility vehicles, tractors, commercial vehicles, construction equipment; and pre-owned vehicles and SME finance, which includes project finance, equipment finance, working capital finance and bill discounting services to SMEs. The company also undertakes mutual fund distribution, fixed deposits and personal loans tailor-made to suit its unique customer set.

Through its subsidiary, Mahindra Insurance Brokers Limited (MIBL), it provides life and non-life insurance products through tie-ups with various leading insurance companies. Another one of it subsidiaries Mahindra Rural Housing Finance, provides loans for home construction, extension, purchase and improvement to customers in rural and semi-urban India. Mahindra Asset Management Company, offers a variety of mutual fund schemes, with a special focus in rural and semi urban areas. Interestingly, its Mutual Fund schemes have been launched with Hindi names, so that investors in rural areas understand the objectives of the schemes better.

Business area of the company

Mahindra & Mahindra Financial Services is a Non-Banking Financial Company (NBFC) engaged in providing asset finance through its pan India branch network.

Products and services offered by the company

Investments

SME Loans

Loans

  • Tractor Loans
  • Utility Vehicle Loans
  • Car Loans
  • Pre-owned Car Loans
  • Three-wheeler Loans
  • Two-wheeler Loans
  • Home Loans
  • Personal Loans

Insurance

  • Life Insurance
  • Customised Plans
  • General Insurance
  • Reinsurance
  • Group Insurance

Awards

  • Awarded at the 16th National Award for Excellence in Cost Management - 2018.
  • Listed in Top 20 India’s Best Workplaces 2019 in the BFSI Industry by the Great Place to Work institute.
  • Awarded first position for Excellence in Cost Management - F 2018 at an award ceremony at Delhi in November 2019.
  • Recognised among best 50 People Capital Index (PCI) Companies 2019 which measures companies with best people development practices.
  • Won the Indian Oil Logistics Award CV Financer of the Year 2019.
  • Won Marketing Award for ‘Best Customer Engagement’ at ABP News, BFSI Awards 2019 (Sutradhar Samrudhi Program-Direct Marketing initiative).
  • Made it to one of the most prestigious global benchmarks for corporate responsibility and sustainability, the Dow Jones Sustainability Index (DJSI), in the Emerging Markets Category for the 7th consecutive year.
  • Won the ‘Best Employer’ by Aon in August 2019. The results were based on employee experience scores, CEO intent and design of HR practices.
  • Awarded Global Corporate Sustainability Award (GCSA) under the category Reporting (Emerging Market) hosted by Alliance for Sustainable Development Goals (A•SDGs), Taiwan.
  • Received performance band C in the CDP assessment 2018-19 implying that the company are at ‘Awareness’ band this year. This is same as the Asia regional average of C, and same as the Financial services sector average of C.
  • Honoured with the IDF CSR Award 2019 for participation in Resource Mobilisation for Humanitarian Causes.
  • Ranked 49th amongst Top 100 Indian companies for Sustainability by CSR under ‘Responsible Business Rankings 2019’ by Futurescape.
  • Included in the renowned FTSE4Good Index Series constituent, a testimony to continued leadership in Environmental, Social and Governance (ESG) performance.

Milestones:

1991

  • Incorporated as Maxi Motors Financial Services Limited 
  • Received certificate of commencement of business

1992

  • Name changed to : Mahindra & Mahindra Financial Services Limited

1993

  •  Commences financing of M&M utility Vehicles

1995

  • With an aim to expand its business, it establishes first branch outside Mumbai, at Jaipur

1996

  • It stared financing M&M dealers for purchase of tractor

1999

  • Introduce tractor retail financing in rural and semi rural areas

2001

  • A decade of good work results total asset crossing 10 billion mark

2002

  • Gets into financing of non-M&M vehicles
  • International Finance Corporation grants Tier II debt

2004

  • Listing of Non Convertible debenture on BSE on the wholesale debt market segment

2005

  • Mahindra Insurance Brokers Ltd become wholly-owned subsidiary

2006

  • Issued IPO
  • Collaboration with Maruti Udyog Limited

2007

  • Mahindra Finance was issued certificate by the RBI under section 45-IA of the Reserve Bank of India Act, 1934 classifying it as an 'Asset Finance Company - Deposit Taking.

2008

  • Enters into home loan business through subsidiary, Mahindra Rural Housing Finance Limited (MRHFL)

2009

  • NHB provides 12.5% equity participation for Mahindra Finance’s subsidiary, MRHFL

2010

  • Introduction of finance for Commercial Vehicles and Construction Equipments

2011

  • Total asset crosses the Rs 100 billion benchmark 
  • Maiden QIP Issue 
  • Joint Venture with Rabobank subsidiary for tractor financing in USA

2012

  • Customer base crosses 2 million 
  • AUM Crosses Rs 20,000 crore 
  • Branch network crosses 600 Mark

2013

  • Customer base crosses 2.5 million
  • Cumulative asset finance crosses Rs 100,000 crore
  • MIBL's strategic partnership with LeapFrog to design and deliver insurance solutions

2014

  • India Ratings and Brickworks Ratings upgraded company's long term debt rating to ‘AAA’ CARE Ratings also assigned ‘AAA’ rating to company's long term debt 
  • MIBL declared 'Broker of the Year' at 18th Asia Insurance Industry Awards 
  • Mahindra Finance wins ABP Award for Most Admired Company in Financial Service Sector 
  • Crosses the benchmark of financing more than 4 million customers through more than 1200 branches.

2015

  • On 30th September, 2015, Mahindra and Mahindra Financial Services Ltd. was successfully appraised and rated at Maturity Level 3 of the People Capability Maturity Model (People-CMM). People CMM is a framework for organizational change through streamlined people management. At maturity Level 3 of the People CMM, MMFSL has implemented robust HR processes and aligned itself to a competency framework.

2016

  • Ranked 68th among 791 employers surveyed in India
  • Ranked 5th in Financial Services sector in India
  • Ranked 3rd in Workplace Transformation case study

2017

  • Recognised among Top 19 in Aon Best Employer 
  • Ranked 49th in India's Best Companies to Work for by The Great Place to Work Institute and Economic Times 
  • Recognised by Working Mother and AVTAR 100 Best Companies for Women in India

2018

  • Appraised and rated at People CMM Maturity Level 5
  • Listed on Dow Jones Sustainability Index (DJSI) for the fifth year in a row
  • Included in the Sustainability Yearbook 2018 by RobecoSAM
  • Honoured with the Indian Development Foundation (IDF) CSR Award 
  • Adjudged as the runner-up in the Business World HR Excellence Award for Excellence in Learning and Development 
  • Conferred with the Equal Opportunity Employer Award during the 4th National Conference on Disability by Sarthak Educational Trust 
  • Received the prestigious ET Best BFSI Brands 2018 Award 
  • Ranked 14th in India's Best Places to Work For - The Economic Times

2019

  • Celebrated 25 years of Mahindra Finance 
  • Recognised as the e Great Place to Work by Economic Times 
  • Won the Marketing Award for the Best Customer Engagement Activity by ABP News - BFSI Awards

2020

  • Joint Venture with Manulife Investment Management (Singapore) for Mutual Fund business
  • Ranked 25th in India's Best Companies to work by The Economic Times & Great Place to Work.
  • Ranked 6th in the list of Best Large Workplaces in Asia by Great Place to Work Institute
  • Joint Venture with Ideal Finance for providing financial services in Sri Lanka
Puchho Befikar
SEBI Registered: Investment Adviser - INA000013323

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