The Mahindra and Mahindra (M&M) Group is reportedly planning to take 10 of its units public in the next 5-7 years as it aims to enhance shareholders’ return on equity, Mint reported on Thursday. M&M has identified the 10 companies across sectors such as financial services, clean energy, mobility, technology and infrastructure.
This was revealed by Anish Shah, Group Chief Financial Officer and Deputy Managing Director at M&M, in an interview to Mint. “We would expect 2-3 businesses to IPO in the next 2-3 years; some will go public in 3-5 years and others in 5-7 years," Shah told the business daily.
While the contribution of each of these 10 units to M&M’s overall revenues is low, their cumulative revenues stand at over Rs 10,000 crore, Shah said, adding that they have shown a strong ability to execute and deliver profits, and many of them are generating cash.
Diesel generator maker Mahindra Powerol, supply-chain consultant Bristlecone, electrical steel processor Mahindra Accelo and cleantech firm Mahindra Susten are among the 10 units that have been identified by M&M. Mahindra Electric Mobility, the maker of electric vehicles; and used-car seller First Choice Wheels are also among the list of companies identified.
Terming these 10 companies as gems, Shah said that these gems were identified as part of M&M’s strategic plan to ensure 18% return on equity (RoE) across all business units in the mid-term. To achieve its stated objective, M&M plans to sell loss-making units including the US-based electric bike startup GenZe and Australia-based small aircraft maker GippsAero Pty Ltd.
Shah, who will succeed the current Managing Director and Chief Executive Officer Pawan Goenka in April, said the company is also looking for investors in the used-cars business.
Meanwhile, shares of Mahindra & Mahindra (M&M) surged over 11% on Wednesday to touch a 52-week high of Rs 709.80 per share after the company on Tuesday said it will manufacture its new tractor series 'K2' at its Zaheerabad facility in Telangana.