In a game-changing deal that signals Mahindra & Mahindra’s aggressive push to dominate India’s commercial vehicle sector, the automotive giant announced the acquisition of a 58.96% stake in SML Isuzu Ltd for ₹555 crore (around $65 million). This strategic acquisition is set to double Mahindra’s market share in the >3.5 tonne truck and bus segment from a modest 3% to 6%, with ambitious plans to reach 12% by FY31 and over 20% by FY36.
Mahindra is acquiring the entire 43.96% stake held by Japan’s Sumitomo Corporation and an additional 15% stake from Isuzu Motors Ltd, followed by a mandatory open offer to purchase up to 26% more shares from public shareholders, complying with SEBI takeover regulations. The acquisition price of ₹650 per share is a steep discount compared to SML Isuzu’s recent closing price of around ₹1,773, reflecting a shrewd deal by Mahindra.
SML Isuzu, established in 1983, is a well-known player with a strong pan-India presence, especially commanding a 16% market share in the Intermediate Light Commercial Vehicle (ILCV) bus segment. The company reported operating revenues of ₹2,196 crore and an EBITDA of ₹179 crore for FY24, showcasing profitable operations and strong engineering capabilities.
Dr. Anish Shah, Group CEO & MD of Mahindra Group, hailed the acquisition as a “significant milestone” aligned with their vision of achieving fivefold growth in emerging businesses. He emphasized that the deal fits perfectly with Mahindra’s capital allocation strategy focused on high-potential, operationally excellent sectors. Rajesh Jejurikar, Executive Director and CEO of Mahindra’s Auto and Farm Sector, highlighted that combining Mahindra’s strengths with SML Isuzu’s legacy will create a formidable full-range commercial vehicle player. The acquisition is expected to unlock synergies in cost, manufacturing, branding, dealer networks, and product development, accelerating Mahindra’s growth trajectory in the heavy commercial vehicle segment.
With India’s commercial vehicle market rapidly expanding, this acquisition positions Mahindra to challenge entrenched competitors and capitalize on growing demand for trucks and buses. The deal is subject to regulatory approvals, including from the Competition Commission of India, and is expected to close within 2025.