Mahindra Unveils Major Restructuring for Efficiency Gains
Mahindra & Mahindra Limited has announced a significant corporate restructuring to simplify its structure and enhance operational efficiency. The move aims to streamline operations and support expansion into electric vehicles and navigation of evolving automotive regulations.
The restructuring will indirectly create two new subsidiaries: New Democratic Electoral Trust (NDET) and Kota Farms Services Limited (KFSL), expanding Mahindra's subsidiary network. Mahindra Holdings Limited (MHL) acquired controlling stakes in Mahindra & Mahindra Contech Limited (MMCL) and PSL Media & Communications Limited through a share purchase agreement worth ₹13.38 crore. This increased Mahindra's overall shareholding in MMCL to 99.99% and in PSL to nearly 72%, converting both from associate companies to direct subsidiaries.
Mahindra's share price has gained 35.47% over the past 12 months, and its market capitalisation stands at approximately ₹4.48 lakh crore. The company delivered record consolidated revenue of ₹1.59 lakh crore in FY25, marking a 14% year-on-year increase, and profit after tax surged 20% to ₹12,929 crore. The restructuring is expected to deliver 15-20% improvements in operational efficiency within two years, potentially saving Mahindra ₹200-300 crore annually.
Mahindra & Mahindra Limited's shareholders are expected to gain from improved operational efficiency, reduced administrative costs, and enhanced transparency following the restructuring. The simplified corporate structure will enable faster decision-making and reduce bureaucratic complexities, aiding Mahindra's expansion into electric vehicles and navigation of evolving automotive regulations.
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