Temasek, a Singapore-based corporation, announced in a stock exchange that it had reached a deal with Mahindra & Mahindra, a key player in the automotive industry, to invest Rs 1,200 crore in MEAL, a manufacturer of passenger electric vehicles (EVs), valued at $9.8 billion.
Temasek would increase its ownership in MEAL from 1.49 percent to 2.97 percent by investing Rs 1200 crore in the form of Compulsorily Convertible Preference Shares (CCPS). From up to Rs 70,070 crore to up to Rs 80,580 crore, MEAL’s valuation has increased by 15%.
The sum invested is in line with the Mahindra Group’s strategy to reduce dilution, the business stated.
British International Investments (BII) said in a statement that Temasek will become an investor in MEAL. A prior deal between BII and Mahindra Electric called for an investment of Rs 1,925 crore ($250 million) through CCPS in July 2022, which would result in a stake of 2.75–4.76 percent, depending on milestones reached.
“As we implement our strategy towards future leadership in electric SUVs, Temasek’s investment is a step ahead. Temasek is known worldwide for their robust governance. Anish Shah, MD & CEO of Mahindra & Mahindra, stated that the valuation of up to $9.8 billion is evidence of Mahindra’s EV business and the advancements we have made in the process of expanding the electric SUV portfolio.
Rajesh Jejurikar, Executive Director and CEO, Auto & Farm Sectors, Mahindra & Mahindra, stated, “We highlighted Mahindra’s aim to develop a desirable global brand with the reveal of our new EV range based on the INGLO platform in August 2022 in UK, which is on track for implementation.
According to Mahindra, its EV businesses will need to invest close to Rs 10,000 crore in capital between FY22 and FY27, the firm disclosed in its routine filings to stock exchanges. 4,000 crore rupees of this would be invested between FY22 and FY24, and the remaining amount will be until FY27.
Between April and October 2025, Mahindra intends to introduce five new EV cars. By March 2027, Mahindra anticipates that between 20% and 30% of all SUV sales would come from electric versions. However, the company is having trouble keeping up with demand for the recently introduced SUVs due to supply chain issues. M&M had a 266,000 unit open order book at the end of the third quarter, with some of its models having wait times of up to a year. The company is currently ramping up capacity from 29,000 units at the end of FY24 to 49,000 units per month.
