To ink a deal that will enhance Mahindra and Mahindra's commercial-vehicle portfolio, M&M is in talks to acquire the promoter's stake in SML Isuzu, according to sources close to the development. SML Isuzu's portfolio includes school buses.
In December last year, Sumitomo Corporation, the promoter of SML Isuzu, held 43.96 per cent in the company, according to stock exchange data.
Isuzu Motors (Japan), which makes sport utility vehicles and pickup trucks, holds 15 per cent in SML Isuzu.
In March 2024, SML Isuzu's market capitalisation on the BSE was around Rs 2,500 crore, and 44 per cent at current prices would be valued at about Rs 1,100 crore.
However, according to reports, M&M is considering a price of Rs 1,400 to Rs 1,500 per share, valuing the company at about Rs 2,000 crore.
Bankers say with a low market share in the CV market, SML Isuzu is unlikely to get a premium on market valuation. Its sales remained flat in 2024-2025 with a 0.2 per cent growth rate in April-February.
Last month, however, the company saw strong double-digit growth. There was 35.8 per cent growth in passenger vehicles (buses) and a 15.3 per cent increase in cargo vehicles.
M&M is likely to hold a board meeting this month to discuss the matter, sources said. The spokesperson for the company said: "We do not comment on market speculation.'
The Mahindra Truck and Bus Division gives integrated trucking solutions, such as those for haulage, tippers, and tractor-trailers in the heavy commercial vehicle category, apart from the ones relating to light commercial vehicles (LCVs) and buses.
Sohini Das & Dev Chatterjee, Business Standard
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