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The board of the country’s well-known auto company Mahindra & Mahindra (M&M) has approved the sale of its truck and bus business to another company (subsidiary) ‘SML Mahindra’. This entire deal has been finalized for Rs 525 crore. As soon as this news came out, there was no limit to the happiness of the investors in the market and the shares of SML Mahindra immediately hit upper circuit of 20 percent. In fact, instead of keeping its entire commercial vehicle business separate, Mahindra Group is now bringing it under one roof.
Strong rise seen in shares
As soon as they got wind of this deal, investors started buying shares of SML Mahindra heavily. By 2:40 pm on Monday, its shares jumped 20 percent to Rs 4,566. At the same time, shares of Mahindra & Mahindra were trading at Rs 3,226 with a slight decline of 1.4 percent.
The company has said that this deal is being done through ‘slum sale’. This means that the entire assets of the truck and bus division, the employees working there, the licenses and all the liabilities of the company will now go to SML Mahindra. This deal worth Rs 525 crore is expected to be signed definitively by August 7, 2026. If everything goes well and necessary government approvals are obtained, then this entire process will be over by January 31, 2027.
Why did you sell this business to your own company?
Now the question arises that when everything belongs to Mahindra, then why is the business being shifted from one company to another? Mahindra Group CEO and Managing Director Anish Shah has explained this very clearly.
Actually, the company wants only one company (SML Mahindra) to handle the entire work of trucks and buses. With this, their entire focus will be on this sector and they will be able to progress more rapidly in the market. Let us remind you that last year in August 2025, Mahindra had purchased ‘SML Isuzu’ from Sumitomo Corp and Isuzu Motors, and renamed it ‘SML Mahindra’. Now this company is being made the only and strongest commercial vehicle player of the group.
What will be the impact on customers?
With such a major change, a question often arises in the minds of people whether this will stop the production of vehicles or will it cause problems to the customers? Mahindra’s Auto and Farm Sector Executive Director and CEO Rajesh Jejurikar has assured that nothing like this will happen.
When Mahindra and SML work together, there will only be further improvement in new technology and facilities provided to customers. The best thing is that both the brands will retain their old identity in the market. The production of vehicles will also not stop, because Mahindra will continue to manufacture trucks and buses in its factories under a contract. Only their management and sales work will be in the hands of SML Mahindra.
How big is this deal
Talking about the figures, in the financial year 2026, this truck and bus division had earned a handsome amount of Rs 2,989 crore. This is about 2 percent of the total earnings of Mahindra & Mahindra. As of March 31, 2026, the value of this business in the company’s books was estimated at Rs 481 crore. To determine the correct price of this deal, a report was made from a company named ‘GT Valuation Advisors’, after which this deal of Rs 525 crore has been finalized.
Disclaimer: This article is for information only and should not be considered as investment advice in any way. TV9 Bharatvarsh advises its readers and viewers to consult their financial advisors before taking any money-related decisions.
