Mahindra and Mahindra, the Indian automaker, recently secured $145 million from Temasek for its electric vehicle (EV) unit at a valuation of up to 805.8 billion rupees ($9.8 billion). This move is part of the company’s ongoing efforts to accelerate its electric mobility ambitions and increase EV sales.
As per the deal, Temasek will acquire up to a 3% stake in Mahindra, following last year’s fundraising round, where the company raised up to $250 million from British International Investments (BII) at a valuation of up to $9.1 billion.
Mahindra is proactively striving to expand the share of its electric SUVs in a market primarily dominated by its larger rival, Tata Motors. The Indian government’s push to achieve 30% EV sales by 2030, up from less than 2% presently, has further intensified the automaker’s focus on electric mobility.
See also: Mahindra Debuts New Electric SUV BE Rall-E at Indiaās Formula E Event
According to Mahindra’s projections, it foresees electric models accounting for approximately 20% to 30% of its total SUV sales by March 2027, underlining the company’s commitment to electric mobility growth.
In a press release, Mahindra CEO Anish Shah expressed enthusiasm about Temasek’s investment, considering it as a significant step towards achieving future leadership in the electric SUV segment.
India’s electric vehicle market, while still small, is witnessing steady growth and attracting interest from global players, including Tesla. Tesla, the world’s largest EV maker, is in discussions with the Indian government to explore investment opportunities for a potential factory focused on producing low-cost EVs, aiming for a price target of approximately $24,000. This prospect could pose competitive challenges for local automakers.
In response to the evolving market dynamics, rival Tata Motors successfully raised $1 billion from TPG’s Rise Climate Fund in 2021, valuing the company at about $9.1 billion.
See also: Mahindra Invests $121 Million in Electric Vehicle Manufacturing Facility in Telangana, India
Over the past year, Mahindra has been engaged in negotiations with various global investors, including green funds and private equity players, to raise funds ranging between $250 million and $500 million. These efforts are part of their strategic plan to accelerate their EV initiatives.
Following the recent deal with Temasek, Mahindra’s shares experienced a temporary dip of up to 2.5%, ultimately settling with a 1.2% decrease at the end of the trading session. As the company continues its fundraising and expansion efforts, industry watchers are closely monitoring the developments in India’s EV market, anticipating further growth and competition in the segment.
