Current Rating and Its Significance
On 10 November 2025, MarketsMOJO revised Mahindra & Mahindra Ltd’s rating from 'Hold' to 'Buy', reflecting an improved assessment of the company’s prospects. This 'Buy' rating indicates that the stock is expected to outperform the broader market over the medium to long term, making it a favourable choice for investors seeking growth in the automobile sector. The current Mojo Score stands at 71.0, up from 68, signalling enhanced confidence in the company’s fundamentals and market position.
Here’s How the Stock Looks Today
As of 25 January 2026, Mahindra & Mahindra Ltd continues to demonstrate robust financial health and operational strength. The stock has delivered a 22.78% return over the past year, outperforming many peers in the automobile sector. Despite a slight dip of 0.84% on the day, the medium-term trend remains positive, with a six-month gain of 8.41%. Year-to-date, the stock has experienced a modest decline of 4.50%, reflecting broader market volatility rather than company-specific weakness.
Quality Assessment
The company’s quality grade is rated as 'good', underpinned by consistent growth and profitability. Net sales have expanded at an annualised rate of 15.61%, while operating profit has surged by 32.29% annually, signalling efficient cost management and strong demand for its products. The firm has reported positive results for four consecutive quarters, with operating cash flow for the year reaching a peak of ₹3,175.81 crores. Additionally, the latest six-month profit after tax (PAT) stands at ₹7,756.64 crores, growing at 20.20%, which highlights sustained earnings momentum.
Valuation Perspective
Mahindra & Mahindra Ltd’s valuation is currently considered 'attractive'. The company’s return on capital employed (ROCE) is a healthy 15.5%, reflecting efficient utilisation of capital resources. Its enterprise value to capital employed ratio is 3.1, indicating the stock is trading at a discount relative to its historical averages and peer group valuations. The price-to-earnings growth (PEG) ratio of 1.6 suggests that the stock’s price reasonably reflects its earnings growth potential, offering a balanced risk-reward profile for investors.
Financial Trend and Stability
The financial grade assigned is 'positive', supported by strong cash flows and profitability trends. The company’s net sales for the latest quarter reached ₹46,105.67 crores, the highest recorded, signalling robust demand and operational scale. Institutional investors hold a significant 68.08% stake, underscoring confidence from sophisticated market participants who typically conduct thorough fundamental analysis. This high institutional ownership often contributes to stock price stability and liquidity.
Technical Outlook
From a technical standpoint, the stock is rated as 'mildly bullish'. While short-term price movements have shown some volatility, the overall trend remains upward, supported by solid fundamentals and positive market sentiment. The combination of technical strength and fundamental quality makes the stock an appealing option for investors looking to capitalise on growth in the automobile sector.
Market Position and Industry Context
Mahindra & Mahindra Ltd is a large-cap company within the automobile sector, recognised for its diversified product portfolio and strong brand presence. It ranks among the top 1% of companies rated by MarketsMOJO across a universe of over 4,000 stocks, reflecting its superior standing in terms of quality, valuation, financial health, and technical indicators. This elite positioning further supports the 'Buy' recommendation, signalling that the company is well placed to deliver sustainable returns.
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Implications for Investors
For investors, the 'Buy' rating on Mahindra & Mahindra Ltd suggests that the stock is expected to generate returns above the market average, supported by strong fundamentals and favourable valuation. The company’s consistent growth in sales and profits, combined with attractive valuation metrics, provides a compelling case for inclusion in a diversified portfolio. The positive technical outlook further supports the timing for potential entry or accumulation.
Investors should note that while the stock has shown resilience and growth, market fluctuations remain a factor, as reflected in recent short-term price movements. Therefore, a long-term investment horizon aligned with the company’s growth trajectory is advisable to fully benefit from its potential.
Summary
In summary, Mahindra & Mahindra Ltd’s current 'Buy' rating by MarketsMOJO, last updated on 10 November 2025, is justified by its strong quality metrics, attractive valuation, positive financial trends, and supportive technical indicators as of 25 January 2026. The company’s leadership in the automobile sector, robust earnings growth, and high institutional backing make it a stock worth considering for investors seeking growth opportunities in this space.
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