Neutral Mahindra & Mahindra, target Rs 1562 : Nomura

Nomura, India has a neutral call on Mahindra & Mahindra Ltd. with a target price of Rs 1562. The current market price of Mahindra & Mahindra Ltd. is Rs 1444. Time period given by analyst is year, when Mahindra & Mahindra Ltd. price can reach defined target. The valuations are pricing in strong growth in tractors. The UV segment is facing strong competition. The global investment bank downgraded the stock to 'Neutral' due to only 7 per cent upside. A strong monsoon is expected to bring back pent-up demand in tractors. The global investment bank expects tractor volumes to rise 25 per cent YoY in FY17F. Risks from implementation of the ban or higher duties on diesel vehicles still remain.