Tuesday, April 29, 2025
By Kamal Swami
M&M to Acquire SML Isuzu to Boost CV Market Share
Aiming to strengthen its presence in India's competitive commercial vehicle segment, Mahindra & Mahindra Ltd. on Monday announced its plan to acquire SML Isuzu Ltd., an established manufacturer of light commercial vehicles (LCVs) and buses. The announcement was made at a press conference addressed by Mahindra’s top executives. In the conference, the company revealed that the proposed acquisition is expected to immediately raise its truck and bus market share from the current 3% to over 6% in FY2025, with combined revenues projected to exceed ₹5,000 crore. The company is targeting a 10–12% share by FY2031, and a long-term goal of more than 20% by FY2036.
The acquisition includes a controlling stake in SML Isuzu by purchasing a 43.96% share from Sumitomo Corporation and 15% from Isuzu Motors Ltd., amounting to a total of ₹555 crore. A mandatory open offer will also be launched to acquire up to 26% from public shareholders, in accordance with SEBI regulations. In the words of Anish Shah, Group CEO & Managing Director of the Mahindra Group “We’ve taken a structured and disciplined approach. We only moved forward once it made strategic and financial sense”. Moving ahead, he also added “Now is the right time.”
Commenting about the decision to acquire SML Isuzu, Rajesh Jejurikar, Executive Director and CEO of Mahindra’s Auto and Farm Sector, acknowledged the intense competition in the Medium and Heavy Commercial Vehicle (MHCV) market but said the company is being “realistic” with its growth plans. He also highlighted the complementary nature of SML Isuzu’s portfolio to Mahindra’s strengths in the LCV and pickup truck segments. While some investment will be required to integrate operations and product lines, the sources of Mahindra clarified that SML Isuzu is expected to fund most of these needs through internal cash generation. Mahindra has already accounted for its broader truck and bus investment needs in its capital expenditure roadmap shared earlier.
Shah described the SML plant as a “very well-run, frugally designed factory,” saying that although it requires “some investments,” they are “nothing dramatic.” He added that SML’s product line has seen significant development in recent years, including leveraging technology associations to produce quality offerings. SML Isuzu, originally set up in 1983 as Swaraj Vehicles Ltd. was part of a government initiative to promote fuel-efficient LCVs. Today, it offers diesel and CNG trucks, buses, and special-purpose vehicles, with electric variants under development.
