Markets
Can M&M’s new electric vehicles help it overcome industry hurdles?
Summary
- The BE 6e and XEV 9e have bigger batteries, more powerful electric motors and better features than the XUV 400, and are priced attractively compared to rivals’ offerings. But can they surmount industry-wide challenges such as poor charging infra and weak resale value?
Mahindra & Mahindra Ltd (M&M) has widened its electric vehicle (EV) portfolio with the launch of two new models – BE 6e and XEV 9e. Its first EV, the XUV 400, is still struggling almost two years after its launch in January 2023, with sales of about 1,000 units a month. The new models have bigger batteries, more powerful electric motors and better features than the XUV 400, and are priced attractively compared to rivals’ offerings.
Here's the hard part, though. The Indian EV industry has two main problems: poor battery charging infrastructure and weak visibility on resale value. Rapidly changing technology and frequent updates to models make it hard to get a reasonable resale price for older models. JSW MG Motor India has tried to address this problem by assuring 60% buyback value after three years or 45,000 km. Still, the company’s sales volume of about 3,000 units in October is nothing to write home about.
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Tata Motors Ltd, the leader in electric passenger cars in India, demonstrates the struggles of EV makers. Its wholesale EV sales in the September quarter fell 16% year-on-year and 6% quarter-on-quarter. Though October retail sales were better, it is too early to predict a significant revival in electric car demand.
M&M’s stock had a muted reaction to the new launches, suggesting investors weren’t enthused. The two new models will have a combined annual manufacturing capacity of 90,000 vehicles, or about 10% of M&M’s estimated sales of 900,000 units in FY25. However, since EV offtake remains slow, it may be a while before the full capacity for the new models is utilised.
Fast charging, slow infra
The two new models have a battery capacity of 59 kWh and 79 kWh versus the XUV 400’s maximum of about 40 kWh. The company said the two new models also have fast-charging technology that enables up to 80% charging within 20 minutes for a 79 kWh battery. This requires a power sending capacity of 175 kW through direct current, which is faster than the alternating current used in homes.
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Statiq, one of the largest providers of independent electric charging stations in India, with 7,000 charging points across 65 cities, has chargers with a power sending capacity of 30 kW, 60 kW, 120 kW and 240 kW. So, if a prospective buyer of the two new models wants to achieve the advertised charging time, he can only use a 240 kW charging station. Charging at other stations will take more time. Though Statiq has not shared the exact number of 240 kW charging stations, it is presumed to be a small fraction of the total.
So far in FY25, M&M has outperformed industry leader Maruti Suzuki India Ltd on volume growth momentum and stock price gains on the back of new launches in internal combustion engine (ICE) portfolio. Though most broking firms have a positive view of M&M stock, others such as Emkay Global Financial Services have retained their ‘reduce’ rating, pointing out that the best of the SUV launch cycle is now over.
M&M stock trades at about 27 times its estimated earnings from October 2025 to September 2026, versus about 21.5 times for Maruti and 24 times for Hyundai Motor India Ltd, Emkay said in a 27 November report.
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