Temasek To Invest Rs 1,200 Crore In Mahindra’s EV Subsidiary Mahindra Electric Automobile Limited

Mahindra & Mahindra shares remained in focus on Thursday (August 3) after the company informed via an exchange filing that Temasek Holdings Pvt Limited, Singapore's sovereign wealth fund, will invest Rs 1,200 crore in its EV business Mahindra Electric Automobile Limited (MEAL) in one or more tranches.

The fresh investment of Rs. 1,200 crores by Temasek in Compulsorily Convertible Preference Shares (CCPS) of MEAL, would value MEAL at up to Rs. 80,580 crore. The said investment also envisages Temasek having a nominal shareholding of 100 Equity Shares in MEAL.

Post infusion of Rs. 1,200 crores as mentioned above, Temasek will have a shareholding in MEAL in the range of 1.49% to 2.97% of the paid–up Share Capital of MEAL, on a fully diluted basis.

Temasek Holdings (Private) Limited is a Singapore-headquartered global investment firm with a net portfolio value of US$287 billion as of March 31, 2023. Temasek has overall corporate credit ratings of Aaa/AAA by rating agencies Moody’s Investors Service and S&P Global Ratings respectively.

The company informed that the execution of aforesaid Agreement(s) has been completed by the parties on August 3, 2023.

Temasek will join British International Investments (BII) as an investor in MEAL. With this investment, Mahindra’s EV subsidiary’s valuation goes up by 15% from up to Rs 70,070 crores to Rs 80,580 crores. The breadth of global experience of these marquee investors will be valuable for MEAL. The amount invested is consistent with the Mahindra Group’s plan to minimize dilution.

Commenting on this development, Anish Shah, MD & CEO of Mahindra & Mahindra Ltd., said, “We are extremely delighted to have Temasek as a partner in our electric SUV journey. Globally known for their strong governance, Temasek’s investment is a step forward, as we execute our strategy towards future leadership in electric SUVs. The valuation of up to $9.8 billion is testimony to Mahindra’s EV business and the progress we have made in the journey towards scaling up the electric SUV portfolio.”

The automotive manufacturer envisages a Capital Investment Program of Rs. 10,000 crores cumulatively in MEAL by FY27.

Mahindra And Mahindra shares were down 1.68% at Rs 1,460.35 per share at 2:16 pm IST today.