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M&M Set to Report Q4 Results: Strong Year-on-Year Growth Expected
Mahindra & Mahindra (M&M) will announce its fourth-quarter and full-year fiscal 2026 financial results on May 5th. Analysts predict strong year-over-year growth. JM Financial forecasts an adjusted net profit over ₹3,351 crore (up more than 37% from the previous year), and Kotak Institutional Equities estimates net profit at ₹3,609 crore (a 48% year-on-year jump). Revenue is also expected to rise sharply year-over-year, with Kotak forecasting around ₹38,094 crore, up 22%. The stock, trading near ₹3,167, faces investor attention as it reports these numbers alongside expected sequential slowdowns. M&M's stock has historically responded well to strong Q4 earnings, jumping nearly 5% intraday after Q4 FY25 results.
Sequential Slump and Margin Pressures Loom
Despite the positive year-over-year outlook, M&M is expected to see a sequential decline in revenue and profit. This is mainly due to seasonal factors that typically reduce demand for tractors. JM Financial expects revenue to fall nearly 4% quarter-on-quarter (QoQ), with tractor volumes down 20% due to seasonality. Kotak forecasts a 1% QoQ revenue drop. Both firms also predict potential year-over-year decreases in average selling prices (ASPs) for automotive and tractor segments, with Kotak seeing tractor ASPs down 1% and auto ASPs down 2%. This pricing pressure, along with rising commodity costs and a growing sales mix of electric vehicles (EVs), is expected to hurt profits. Kotak forecasts EBITDA margins to fall 40 basis points (bp) year-on-year (YoY), while JM Financial projects a 70 bp QoQ contraction due to a product mix shift and higher raw material expenses, including platinum group metals.
EV Strategy and Competition: Key Concerns
M&M has a strong position in SUVs and tractors but faces new challenges. Its growing EV sales, an important goal, currently hurt margins. Competitors like Maruti Suzuki (P/E ~29.15, market cap ₹4.27 lakh crore) and Ashok Leyland (P/E ~29.76, market cap ₹1.03 lakh crore) are in related markets. Tata Motors trades at a lower P/E of about 20.6. M&M's P/E is around 25.04, placing it competitively but raising questions about how its EV strategy will affect profitability. The Indian auto sector saw record sales of 29.67 million units in FY26, with passenger vehicles up 13% and tractors up 19%, showing a strong market. However, M&M's ability to keep its market share and margins in this competitive environment, especially with changing consumer interest in EVs, is a key concern. Analysts point to the risk of missing earnings estimates for Q4 FY26 or FY27 guidance as a factor that could pressure the stock. Foreign institutional investor (FII) outflows could also worsen stock declines if local institutional investors reduce holdings.
Dividend Payout and FY27 Guidance
Investors are also eagerly awaiting a potential dividend recommendation for FY26, with forecasts pointing to ₹28–36 per share, compared to ₹25.3 per share in FY25. The company's guidance for FY27 will be crucial for investor outlook. Analysts have set a 12-month consensus price target for M&M between ₹3,200 and ₹3,600, mostly indicating a 'Buy' recommendation. This outlook depends on M&M meeting Q4 estimates and offering positive FY27 guidance. The market's reaction will hinge on how well M&M balances its strong year-over-year results against sequential challenges and its approach to the EV transition.