Mahindra & Mahindra Financial Services Analysis

dividend

Pros

• Dividends after 3 years are expected to be well covered by earnings (5.7x coverage).

Cons

• Unable to calculate sustainability of dividends as Mahindra & Mahindra Financial Services has not reported any payouts.
• Unable to evaluate Mahindra & Mahindra Financial Services's dividend yield against the bottom 25% of dividend payers as the company has not reported any payouts.
• Unable to evaluate Mahindra & Mahindra Financial Services's dividend against the top 25% market benchmark as the company has not reported any payouts.

future

Pros

• Mahindra & Mahindra Financial Services's earnings are expected to grow significantly at over 20% yearly.
• Mahindra & Mahindra Financial Services's earnings growth is expected to exceed the India market average.
• Mahindra & Mahindra Financial Services's earnings growth is expected to exceed the low risk savings rate of 7.2%.
• Mahindra & Mahindra Financial Services's earnings are expected to increase by more than the low risk growth rate in 3 years time.
• Performance (ROE) is expected to be above the current IN Consumer Finance industry average.
• An improvement in Mahindra & Mahindra Financial Services's performance (ROE) is expected over the next 3 years.

Cons

• Mahindra & Mahindra Financial Services's earnings are expected to decrease over the next year.
• Mahindra & Mahindra Financial Services's net income is expected to increase but not above the 50% threshold in 2 years time.
• Mahindra & Mahindra Financial Services is not expected to efficiently use shareholders’ funds in the future (Return on Equity less than 20%).
• Mahindra & Mahindra Financial Services's revenue is expected to increase but not above the 50% threshold in 2 years time.
• Mahindra & Mahindra Financial Services's revenue is expected to grow by 4.5% yearly, however this is not considered high growth (20% yearly).
• Mahindra & Mahindra Financial Services's revenue growth is positive but not above the India market average.

health

Pros

• Mahindra & Mahindra Financial Services is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
• Mahindra & Mahindra Financial Services is profitable, therefore cash runway is not a concern.
• Mahindra & Mahindra Financial Services is profitable, therefore cash runway is not a concern.
• Debt is covered by short term assets, assets are 1.3x debt.
• Mahindra & Mahindra Financial Services's cash and other short term assets cover its long term commitments.
• The level of debt compared to net worth has been reduced over the past 5 years (491.1% vs 471.8% today).
• Low level of unsold assets.

Cons

• Operating cash flow is negative therefore debt is not well covered.
• Mahindra & Mahindra Financial Services's level of debt (471.8%) compared to net worth is high (greater than 40%).

management

Pros

• The tenure for the Mahindra & Mahindra Financial Services board of directors is about average.
• Ramesh's compensation has been consistent with company performance over the past year, both up more than 20%.
• The average tenure for the Mahindra & Mahindra Financial Services management team is over 5 years, this suggests they are a seasoned and experienced team.

Cons

• Ramesh's remuneration is higher than average for companies of similar size in India.

misc

Pros

Cons

• Mahindra & Mahindra Financial Services has significant price volatility in the past 3 months.

past

Pros

• Mahindra & Mahindra Financial Services's year on year earnings growth rate has been positive over the past 5 years.

Cons

• Mahindra & Mahindra Financial Services's 1-year earnings growth is negative, it can't be compared to the 5-year average.
• Mahindra & Mahindra Financial Services used its assets less efficiently than the IN Consumer Finance industry average last year based on Return on Assets.
• Mahindra & Mahindra Financial Services has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).
• Mahindra & Mahindra Financial Services's 1-year earnings growth is negative, it can't be compared to the IN Consumer Finance industry average.

value

Pros

• Mahindra & Mahindra Financial Services is good value based on expected growth next year.
• Mahindra & Mahindra Financial Services is good value based on earnings compared to the IN Consumer Finance industry average.
• Mahindra & Mahindra Financial Services is good value based on earnings compared to the India market.

Cons

• Mahindra & Mahindra Financial Services's share price is above the future cash flow value, it's not available at a moderate discount (< 20%).
• Mahindra & Mahindra Financial Services's share price is above the future cash flow value, it's not available at a substantial discount (< 40%).
• Mahindra & Mahindra Financial Services is overvalued based on assets compared to the IN Consumer Finance industry average.
• M&MFIN underperformed the Consumer Finance industry which returned -28.8% over the past year.
• M&MFIN underperformed the Market in India which returned -14.5% over the past year.
• NSEI:M&MFIN is flat (-0.2%) underperforming the Consumer Finance industry which returned 10.3% over the past month.
• NSEI:M&MFIN is flat (-0.2%) underperforming the market in India which returned 8% over the past month.