IFC to Invest ₹600 Crore in Mahindra & Mahindra’s New Last-Mile Electric Mobility Venture
The International Finance Corporation (IFC) has announced a significant investment of ₹600 crore in a new last-mile mobility company, a wholly-owned subsidiary of Mahindra & Mahindra, which will be newly established. This marks IFC's inaugural investment in an electric vehicle manufacturer in India and its first in electric three-wheelers worldwide.
The investment will take the form of compulsory convertible instruments, valuing the new entity—referred to as NewCo—at up to ₹6,020 crore. Following this investment, IFC will hold an ownership stake ranging from 9.97% to 13.64% in NewCo.
NewCo will focus on the last-mile mobility segment, encompassing electric three-wheelers like the Alfa, Treo, and Zor, as well as small commercial vehicles such as the Jeeto. Anish Shah, Managing Director and CEO of Mahindra & Mahindra, stated, "With the electrification of our last-mile mobility business, we are advancing our commitment to becoming 'Planet Positive' by 2040. This also opens significant growth avenues for micro and women entrepreneurs."
As part of its sustainability goals, India has pledged to reduce emissions by 45% by 2030 and aims for 80% electric vehicle penetration in the two- and three-wheeler segments, along with 70% for commercial vehicles and 30% for private cars within the same period. Hector Gomez Ang, IFC's Regional Director for South Asia, highlighted that India is the largest market for three-wheelers globally, stating that this investment represents a crucial step towards scaling domestic production of electric vehicles in this sector, including small commercial vehicles.
Rajesh Jejurikar, Executive Director and CEO of Mahindra & Mahindra's auto and farm sector, noted the company's leadership in this market. "We have a unique opportunity to increase EV adoption in this segment while providing a sustainable and profitable alternative for micro-entrepreneurs."
The IFC, part of the World Bank Group, operates in over 100 countries. In the fiscal year 2022, it committed a record $32.8 billion to private sector firms and financial institutions in developing nations.
