Mahindra & Mahindra Limited (M&M) has announced the acquisition of a 58.96% stake in SML Isuzu Limited (SML) as part of its strategy to aggressively expand its presence in the commercial vehicle (CV) segment. The company will acquire the shares at a price of Rs 650 per share, with a total outlay of approximately Rs 555 crore, according to the stock exchange filings.
Following the acquisition, Mahindra will also launch a mandatory open offer to acquire an additional 26% stake from the public shareholders of SML at a price of Rs 1,554.60 per share.
Strategic roadmap: Doubling market share now, 20%+ by FY36
At present, Mahindra holds a 3% market share in the >3.5T commercial vehicles segment.
With the acquisition of SML Isuzu, Mahindra expects to immediately double its market share to 6%.
The company has outlined aggressive future targets: it plans to achieve 10-12% market share by FY31 and further aims for 20%+ market share by FY36.
SML Isuzu, founded in 1983, is a prominent player in the intermediate commercial vehicles (ICV) and light commercial vehicles (LCV) categories, with a strong product portfolio that includes trucks, buses, and specialized vehicles. The company reported operating revenue of Rs 2,196 crore and EBITDA of Rs 179 crore for FY24.
Strengthening Mahindra’s commercial vehicle play
Mahindra already commands a 52% market share in the sub-3.5 tonne segment (LCVs). The acquisition of SML Isuzu will allow it to significantly bolster its presence in the larger truck and bus segments, unlocking synergies across product development, manufacturing, branding, and distribution networks.
“This acquisition marks a significant milestone in Mahindra Group’s vision of delivering 5x growth in emerging businesses,” said Dr. Anish Shah, Group CEO & MD of Mahindra Group. He emphasized that the acquisition is aligned with the company’s capital allocation strategy of investing in high-potential, growth-oriented businesses.
Rajesh Jejurikar, Executive Director and CEO of Mahindra’s Auto and Farm Sector, noted,
“SML brings a strong legacy, a loyal customer base, and a credible product portfolio that complements Mahindra’s trucks and buses business. Together, we are well-positioned to scale rapidly and drive profitable growth.”
Transaction structure
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Acquisition of 43.96% equity from Sumitomo Corporation.
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Acquisition of 15% equity from Isuzu Motors Limited.
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Mandatory open offer for an additional 26% stake from public shareholders.
The transaction is subject to regulatory approvals, including clearance from the Competition Commission of India (CCI), and is expected to be completed by December 2025.
Upon completion, SML Isuzu will become a listed subsidiary of Mahindra & Mahindra Limited.
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