When Satyam collapsed and the buzz in the word was that this will be another winding up of the company as the situation demand. Moreover no one was there to remove the stains of corporate default and the broken corporate governance. The world economy was merged in to the problems of recession and India was struggling to make a come out from the cold breeze of cash crunch. At that point of time the Stayam fiasco got emerged out. It rattled the stock market and made investors to loose out Rs.10500cr in few days. During those turbulent times when no body came to rescue the employees of Stayam and the shareholders of the company. Every body was busy in making a calculation of the respective profitability that could be earned. Mahindra and Mahindra was the company along with Larsen and Turbo came for rescue of the company. After that every one knows what happened.
Mahindra and Mahindra was a company which took birth from very tough situations and even during those struggling times very few were their to support the long term dreams of the company in the initial days. But now Mahindra and Mahindra don’t need any recognition of its dreams.
Mahindra took off the Satyam and now after one year it has turned the fortunes of the company which is know by the world. Mahindra and Mahindra still have strong new decade of new business ventures to grow. It’s making a very bold and aggressive move with a cautious note on every step towards its new decade of dreams.
Mahindra’s future dreams consist of some rewarding fortunes for the shareholders and the Indian industrial economy.
• Mahindra and Mahindra, one of the largest automakers in the country and its plans to launch the electric vehicle by the end of 2010.This will be second company to come out after Tata to roll out such car.
• The advantage Mahindra will get is that in the coming days the crude value will be above $100 dollar once the world economies will bounce back with strong growth. At that point of time this model of car by Mahindra will be competitive on the streets.
• Mahindra is also developing hydrogen and CNG powered vehicles, which could be launched over the next 12-18 months depending on the infrastructure.
• In the automobile segment Mahindra will emerge out to be the market leader in the new decade. Since when other will be busy in giving finishing touch to their products Mahindra will kiss the streets of Indian roads.
• It is also going to start soon export of a new automobile and will try to become the first in Indian auto space to do that export. Mahindra is looking to export a new electric “mini truck” to Europe and the US, becoming the latest Indian carmaker
• Now this product will find good response since US and Europe are going through a high rate of fiscal deficit despite of low crude prices. Now when the crude prices will be around $100 then import bill of crude of US and Europe will reach such levels that it will become impossible to pay such huge bills. This will increase the crude import bill of the two nations making it more vulnerable to rising fiscal deficit.
This was all the story of the Mahindra’s new decade of automobile business growth. Now the company is making a foray into some more diversified business segment where its competitors will be just left away from the track.
It’s making an entry into aerospace products. Surprised but yes this will give the company new dimensions and huge untapped potential to grow in the new decade. It has also laid the first stone of its business.
• Mahindra & Mahindra, in partnership with Kotak Private Equity, has taken majority stakes in Australia based aerospace companies Aerostaff Autralia and Gippsland Aeronautics. The total deal size is at about Rs 175 crore.
• In 2008, it acquired a 100% stake in Metalcastello S.P.A, a leading Italian independent gear manufacturer with the backing of ICICI Ventures Funds.
• It is setting up a plant in Bangalore to complement the acquisition and provide dual shoring cost benefits to customers.
• This also gives the company the entry ticket into aviation segment.
• It also desires to acquire Sona Koyo which is a Tier-III supplier of aerospace components.
The Future Call
Call on Mahindra and Mahindra is going for buy at any level without looking back t any valuation measures. The company will post super rich growth figure and will make its shareholders more rich than any company might be able to do with CONSISTENCY. This company will turn the model of automobile industry of India in coming days. Its business diversification will yield great return over a longer time to the shareholders.
My readers might ask that why I did not went for financial analysis to present the company with more fine quality of data analysis. To them my reply is that I will be coming very soon with a host of analysis of company financials after 3rd quarter results come out. This was only analysis of the future decade of growth that the company is striving to get. This article is presented to bring forth the diversification and the new decade of Indian automobile industry growth.
Author:- Indranil Sen Gupta
Financial, Economic Writer and Research Analyst
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