M&M The Cheapest And Most Attractive Bet Among Auto Stocks

Mahindra & Mahindra Ltd. (M&M) is not only the cheapest large-cap auto stock but is also one of the most preferred by analysts.

It is trading at 18.5 times its earnings in the trailing twelve months, a 12 percent discount to its peers. Nearly 81 percent of the analysts polled by Bloomberg have a ‘buy’ rating on M&M, with an expected upside of 13.4 percent.

While Maruti Suzuki Ltd. has higher ‘buy’ ratings at nearly 82 percent, the analysts consensus expect nearly half of M&M’s potential upside for the company.

What Makes Brokerages Bullish On the Stock?

Motilal Oswal expects better growth coming in from M&M’s tractor business and recovery in utility vehicle (UV) segment, primarily driven by new launches in this vertical. JPMorgan, which is overweight on the stock, notes worries about its UV segment being a bit too overdone.