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Smallcap auto stock surges 10% post Q1 results; zooms 102% in 1 month
Shares of SML Isuzu hit a new high of ₹3,675.15, and were locked at the 10 per cent upper circuit on the BSE in Friday's intra-day trade after the company reported healthy earnings for the quarter ended June 2025 (Q1FY26).
Till 02:13 PM; a combined 579,000 equity shares changed hands and there were pending buy orders for 72,085 equity shares on the NSE and BSE, the exchange data shows.
Thus far in the month of July, the stock price of commercial vehicle company soared 74 per cent after the company reported a strong sales numbers for the month of June 2025. Meanwhile, in past one month, SML Isuzu's market price has more-than-doubled or zoomed 102 per cent. In comparison, the BSE Sensex was up 0.5 per cent during the period.
The stock price the smallcap auto company has skyrocketed 255 per cent from its 52-week low level of ₹1,030.90 touched on February 28, 2025.
SML Isuzu - Q1FY26 results
For the April to June 2025 quarter (Q1FY26), SML Isuzu reported 44 per cent year-on-year (YoY) jump in profit after tax (PAT) at ₹66.96 crore. The company had posted PAT at ₹46.39 crore in Q1FY25. Revenue from operations grew 13 per cent YoY to ₹845.89 crore from ₹746.01 crore in a year ago quarter.
For the first quarter of fiscal year 2025-26, SML Isuzu reported 12.5 per cent YoY jump in total vehicle sales of 4,926 units compared to 4,379 units in the corresponding period last year. Cargo vehicle sales during this three-month period surged 46.3 per cent to 1,282 units from 876 units, while passenger vehicle sales grew 4.0 per cent to 3,644 units from 3,503 units.
Mahindra & Mahindra (M&M) acquiring SML Isuzu
On April 26, 2025, Sumitomo Corporation, Japan (Promoter shareholder) and Isuzu Motors Limited, Japan (Public shareholder) entered into share purchase agreements with Mahindra & Mahindra (M&M), whereby they agreed to sell 6.36 million equity shares (representing 43.96 per cent of the equity share capital of the company) and 2.17 million equity shares (representing 15 per cent of the equity share capital of the company) respectively, of face value of ₹10 each, at a price of ₹650 per share.
Further, on May 5, 2025, M&M announced the 'Open Offer' for acquisition of up to 3.76 million equity shares of face value of ₹10 each, representing 26 per cent of the equity share capital of the company, at a price of ₹1,554.60 per share.
M&M has received unconditional approval from the Competition Commission of India for the said acquisition and the Open Offer on June 17, 2025. The transaction remains subject to the completion of other customary conditions precedent. The open offer opened on June 19, 2025 and closed on July 2, 2025.
M&M said the acquisition will enable the company to strengthen its presence in the trucks and buses segment by unlocking operational synergies, enhancing product development capabilities, and expanding market reach. It supports the company's long-term growth vision in the commercial vehicle industry.
SML Isuzu - Outlook
M&M already has a strong presence in the small commercial vehicle (SCV) goods-carrier segment. The company can use SML Isuzu's Intermediate Light Commercial Vehicle (ILCV) passenger-carrier platform to expand into the ILCV goods segment as well. Also, Mahindra's vast network could help further ramp-up volumes of SML Isuzu's product, according to analysts.
The change in ownership of the entity to M&M, when it materialises, is likely to aid SML's product development/network expansion plans over the medium term, aided by M&M's well-established position in the automotive sector. Accordingly, the developments are expected to be credit positive in ICRA's view.
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