In view of the speculation, the company considers it necessary to make it clear to the stock exchanges that there is no plan to split the car and tractor activities, the car major said. “The company has clarified this in the past, stating that it sees much greater value in synergies by keeping these businesses within the M&M entity.”
Earlier today, there were multiple reports stating that Mahindra Group is evaluating the split of its core businesses – tractors, passenger cars (including EVs) and trucks – into independent entities, which could mark the conglomerate’s most significant restructuring in years.
“These are early internal discussions, with initial reviews having begun to assess the feasibility of such a move and what it will entail. Currently, these companies operate as divisions under the group’s flagship Mahindra & Mahindra (M&M). Over the past five years, both the automotive and agricultural equipment sector (FES) divisions have achieved strong growth,” the reports said earlier.
Mahindra & Mahindra was Company of the Year at the Economic Times Awards for Corporate Excellence last year.
Between FY21 and FY25, the automotive segment’s share of M&M’s revenue rose from 35% to 57%, while its EBIT contribution rose from 13% to 42%, according to ETIG data. The FES division, on the other hand, saw its turnover share fall from 33% to 22% and its EBIT contribution fall from 74% to 27%. SUV sales more than doubled from 190,000 in FY21 to 550,000 units in FY25, while total car volume rose to 941,000 units. Tractor sales, although slower, still grew from 354,000 to 424,000 units over the same period. This is not the first time demerger reports have emerged in Mahindra. Previous talks were also put on hold due to concerns about the loss of shared synergies in purchasing, supply chain and R&D, as well as fears that a smaller, standalone tractor company could become vulnerable to a takeover.
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