Mahindra’s auto business to see Rs 2,725 crore additional investment by FY2024, no investment currently outlined for BS7

Mumbai-headquartered auto major Mahindra & Mahindra is on a roll seeing a smart uptick from its automotive business.

In fact, the company has revisited its cash deployment plans which sees an additional provision of Rs 1,600 crore towards auto CAPEX and Rs 1,125 crore towards Mahindra Electric Automotive, the company’s electric vehicle division. In addition, the company has also planned an increase of Rs 500 crore towards its auto and farm division, while a reduction in Group company investments, monetization and partnerships will see rationalisation.

With this Mahindra’s capital outlay has changed from Rs 15,075 crore announced earlier to Rs 15,900 crore. The revision towards the automotive segment will mainly go towards improving capacity to meet customer demand and meeting regulatory requirements.

On the electric vehicle front, this will be towards product development.

It was recently that the Minister of Road Transport & Highways (MoRTH), Nitin Gadkari asked automotive industry stakeholders to start working towards BS7 emission norms (Euro 7 equivalent). It is important to note that at present, globally, no country in the world had yet come out with the technical specifications defining the same.

Responding to a query on plans for BS7 emissions norms, Rajesh Jejurikar, Executive Director – Auto & Farms Sector, Mahindra & Mahindra said that at present, there were no technical specifications and regulations notified by the government and hence no work has started on the same. The company would continue to focus on expanding its IC-engine offering along with the electrification strategy.

But no significant investments have been planned for BS7 at present, and any CAPEX towards will be decided only when there is some clarity on its roadmap.