Mahindra to make 10 group companies public, sell loss-making units: Report

Mahindra & Mahindra is planning to list 10 of its units in the next 2-7 years as it looks to increase shareholders’ return on equity, reports Mint.

M&M has chosen 10 firms from sectors such as financial services, infrastructure, and clean energy, the company’s Group Chief Financial Officer and Deputy Managing Director Anish Shah told Mint in an interview.

Although the contribution of these units to M&M’s overall revenues is low, their cumulative revenues stand at over Rs 10,000 core, Shah, who is set to succeed the company’s current Managing Director and Chief Executive Officer Pawan Goenka in April, said.

“They are positioned well; they have shown a strong ability to execute and deliver profits, and many of them are profitable and are generating cash. Many of them will not require more cash from the parent to grow,” he told Mint.

Calling these 10 companies “gems”, Shah said that this move is a part of M&M’s strategic plan to ensure 18% RoE across all business units in the mid-term. To reach this target M&M will sell its loss-making units including SsangYong Motor Co., and electric bike startup GenZe, he added.

The companies that made it to the IPO list include Mahindra Accelo, Bristlecone, Mahindra Powerol, and the maker of Jawa Motorcycles—Classic Legends Pvt. Ltd. The company is also looking for investors for its used cars business, Shah told Mint.

He also said that M&M expects 2-3 businesses to go public in the next 2-3 years, some in 3-5 years and the rest in 5-7 years.

Mahindra India