Mahindra & Mahindra Stock Up 1.5%, What’s Driving The Rally?

M&M shares: Mahindra & Mahindra shares rallied on Monday after the passenger and utility vehicle maker announced a strategic acquisition which is likely to boost its position in the heavy vehicle market.

M&M shares were opened higher at Rs 2902.05 per share on BSE, later the company scrip was trading 1.67% higher at Rs 2910 per share on BSE with a market capitalisation of Rs 3,61,866.89 crore.

M&M Acquires Majority Stake In SML Isuzu

M&M will acquire a 58.96% stake in SML Isuzu (SML), worth Rs 555 crore to strengthen its position in the trucks and buses segment, said the company in its BSE exchange filing on Saturday, April 26.

M&M's acquisition of SML Isuzu's stake includes the purchase of 43.96% of its equity share capital from promoter Sumitomo Corporation, and 15 % of its equity share capital from public shareholder, Isuzu Motors Limited (Isuzu).

"Mahindra & Mahindra Ltd ("M&M") today announced that it has entered into an agreement to acquire 58.96% stake in SML Isuzu Ltd. ("SML") at INR 650 per share, which is an outlay of INR 555 crore. In addition, M&M will make an open offer in accordance with SEBI Takeover Regulations," read a press release by M&M.

SML's acquisition is likely to boost its progress in the trucks and buses division made over the past few years. M&M believes that the acquisition would double its market share to 6% paving the way for further expansion to 10-12% by FY31.

SML Isuzu Stock Hits Lower Circuit

While M&M shares are garnering significant interest among investors, SML Isuzu's share price suffered a major blow during the opening trade of Monday's session. The company scrip fell 10% to touch lower circuit mark of Rs 1590.05 apiece on BSE on Monday. SML Isuzu shares were down 10% to Rs 1590.05 apiece on BSE on Monday with a market capitalisation of Rs 2,301.06 crore. SML Isuzu shares touched their 52-week high mark of Rs 2,406 apiece on BSE on 23 May, 2024. The company scrip recently touched its 52-week-low mark of Rs 1,030.90 apiece on BSE on 28 February, 2025.

M&M Open Offer For SML Isuzu Shareholders

M&M will also launch a mandatory open offer for acquisition of up to 26% stake from eligible public shareholders of SML. The open offer has been planned in accordance with the mandatory condition set by the market watchdog to protect the interests of minority stakeholders during acquisitions.