The last mile mobility division of Mahindra & Mahindra (M&M) is being spun off into a new firm, in which the World Bank’s IFC would invest Rs 600 crore.
The goal of the new business, which will be a fully owned subsidiary of Mahindra & Mahindra, is to ramp up production of inexpensive electric three-wheelers and small commercial vehicles.
According to a statement from M&M, the establishment of the subsidiary and IFC’s funding would fundamentally alter the landscape for microentrepreneurs.
The investment will make it possible for the sector to transition smoothly from internal combustion engines to electric automobiles.
This would be IFC’s first investment in an Indian EV company as well as its first investment ever in an electric three-wheeler. It would take the form of obligatory convertible securities with a maximum value of Rs 6,020 crore.
As a consequence of the Rs 600 crore investment, IFC will possess 9.97–13.64% of the new business. The final mile mobility segment, which includes three-wheelers (Alfa, Treo, and Zor) and four-wheel SCVs, will be housed under this company, M&M noted (Jeeto).
“Decarbonizing the transportation industry is essential for India to meet the climate targets she has set for herself. IFC is the perfect partner for us because of its emphasis on sustainability and increasing prosperity, according to Mahindra & Mahindra MD and CEO Anish Shah.
After the news, M&M’s stock appreciated 0.37 percent to close at Rs. 1,164.40.
According to Hector Gomez Ang, regional director for South Asia at IFC, India is the world’s biggest market for three-wheelers, and this investment would be a major step toward expanding local manufacture of electric cars.
Resources for JK Tyre
JK Tyre & Industries Ltd. said on Wednesday that IFC would invest $30 million (about Rs 240 crore) to acquire a 5.6% share in the business and help finance the growth of the production of energy-efficient tires.
The company said in a regulatory filing that the IFC investment in JK Tyre & Industries will help finance the expansion of manufacturing capabilities and the integration of cutting-edge, resource-efficient technologies in the production of commercial and passenger car radial tyres, which have better safety and longevity.