M&M shares jump over 4% as strong auto sales power Q1 earnings growth; here’s what analysts predict for FY27

Mahindra and Mahindra (M&M) shares extended their gains, surging more than 4% during the trading session on Friday, July 31, as investors continued to focus on the automaker’s strong revenue growth fuelling the overall April to June quarter results for the financial year 2026-27.

M&M share price rallied 4.6% to its intraday high of ₹3,434.90 apiece on Friday’s market, compared to ₹3,283.70 apiece at the previous stock market close. This share price jump comes after the automaker’s stock rose 3% post the earnings update on Thursday’s market.

Mahindra and Mahindra announced its Q1 results during the final market hours on July 30.

Experts predict that utility vehicle market share gains, upcoming launches both EV and ICE, resilient tractor demand, strong traction in electric vehicles (EVs), and capacity expansion are estimated to remain in key focus of investors this year.

How did M&M perform in Q1 earnings?

On July 30, Mahindra and Mahindra’s (M&M) board of directors announced that the company recorded a 34% growth in its consolidated net profits to ₹5,454.54 crore in the first quarter of the financial year 2026-27, in comparison to ₹4,083.32 crore in the same period a year earlier.

The automaker’s revenue from core operations advanced around 27% to ₹57,533.44 crore in the June quarter, from ₹45,435.88 crore in the same quarter of the previous year, as per the exchange filing.

Although the company’s raw material cost increased 24% YoY in the period under review, the overall revenue growth powered the company’s financial performance with the help of strong auto sales in the period.

M&M’s automotive business revenues witnessed a 32% rise to ₹34,387.25 crore in Q1 FY27, from ₹25,998.71 crore in the same period a year earlier.

Margin contraction

While the operational level earnings before interest, tax, depreciation, and amortisation (EBITDA) increased around 22%, the company’s EBITDA margins witnessed a 68 basis point contraction in the April to June quarter period, in comparison to the same period a year earlier.

The rising raw material costs in the June quarter, in turn, weighed down the company’s profitability in the period under review.

*Note: All data have been collected from Mahindra and Mahindra’s consolidated financial statements.

What do analysts predict for FY27?

Analysts from leading US-based investment firm Morgan Stanley said that FY27 is set to be exciting for Mahindra and Mahindra with incremental growth potential from the automaker’s internal combustion engine (ICE) business segment.

Although Q1 performance remained marginally weaker-than-expected, looking ahead, the experts also said that the company is expected to witness gradual earnings recovery in the second half of the current fiscal year with improving automotive segment margins.

“We expect gradual earnings recovery in H2. Farm segment margins could face further headwinds in Q2, while auto margins should get better QoQ, but the company did not quantify the benefit,” said Morgan Stanley analysts.

With Q1 EBITDA slightly below estimates, Citibank analysts said that M&M holds a cautiously optimistic outlook in the upcoming period as the electric vehicle segment continues to drive growth while rural market cues remain positive for the farm equipment business.

On the demand front, Macquarie analysts said that Mahindra and Mahindra is estimated to witness a ‘sweet spot’ with multiple SUV launches and tractor demand over the next two years.

“Believe M&M is in a sweet spot with multiple SUV launches over the next 12-24 months and resilient tractor demand,” said Macquarie analysts after the Q1 earnings report.

CLSA analysts said that sustained utility vehicle market share gains with the help of strong execution and upcoming launches, a resilient tractor outlook, strong traction in BEVs, and ongoing capacity expansion are estimated to power Mahindra and Mahindra’s growth.

M&M share price trend

Mahindra and Mahindra (M&M) shares have delivered more than 361% returns on their investments in the last five years, over 132% gains in the last three years, and around 7% in the past one-year period, according to NSE data.

On a year-to-date (YTD) basis, the company shares have lost nearly 9% in 2026, but the stock has gained 11.6% in the last one-month period. The exchange data showed that M&M shares were up 8.4% in the last five market sessions.

Mahindra shares surged to their 52-week high of ₹3,839.90 on January 5, 2026, while the 52-week low was at ₹2,896 on March 16, 2026. The automaker’s market capitalisation (m-cap) was at over ₹4.27 lakh crore as of the trading session on Friday, July 31.