Funding for Mahindra & Mahindra's Classic Legends would total Rs 875 crore

14 Dec 2023 , 03:12 PM

Mahindra announced in a stock exchange filing that Classic Legends Pvt Ltd, a Mahindra & Mahindra subsidiary that produces well-known motorcycle brands like Yezdi and Jawa among others, is scheduled to receive an infusion of funds totaling Rs 875 crore.

Mahindra has committed to investing a total of Rs 525 crore in the form of stock in one or more tranches and CCPS (compulsorily convertible preference shares).

An additional Rs 350 crore will be invested by Classic Legends’ existing shareholders and new investors in the motorcycling making firm in one or more tranches.

Following the new funding infusion, which is anticipated to be finished by March 15, 2025, Mahindra will still own a 60% share in Classic Legends, and the latter will still be a subsidiary of Mahindra. In 2015, Classic Legends was integrated.

The most recent funding round coincides with Classic Legends’ ambitions to invest 1,000 crore through FY26 in an effort to catch up in the Indian middle-weight lifestyle motorcycle market and meet the growing demand for these models abroad.

The funds will be used, among other things, for new product development, marketing, distribution network creation for overseas markets, and tooling up new items. Classic Legends cofounder Anupam Thareja had told ET in September. He had stated that this sum would come from a mix of current stockholders, external investors, and internal accruals.

He had stated that the investment will enable the company to erase the losses from the previous three years and earn a profit in the current fiscal year.

In FY20, the company’s first full year of operation, Classic Legends generated a profit, but due to internal issues, the company lost money. Classic Legends’ revenue for the year ended March 2023 was Rs 709.74 crore, up from Rs 594.99 crore the year before.

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