For 1QFY2020, M&M registered revenue decline of ~4% yoy to `12,923cr. Operating margin declined by 129bps. On the bottom-line front, M&M reported PAT growth of ~90% yoy to `2,314cr on the back of one time exceptional gain ~`1,367cr .
Outlook and Valuation: Over the last few quarters, the company’s volume growth has remained subdued mainly due to overall slowdown in economy, which has affected the buying sentiment. However, we believe that any revival in auto industry would benefit M&M on the back of its recent new launches and facelift of some models, diversified portfolio, strong brand & distribution network. Considering the above factors, we maintain our Buy recommendation on M&M.

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