Mahindra & Mahindra's new last-mile mobility company would receive a Rs 600 crore investment from the International Financing Corporation.

This is IFC's first investment in domestic EV manufacturing and the first in electric three-wheelers internationally. The investment will be made in one or more instalments of up to Rs 6,020 crores in the form of required convertible instruments.

In an effort to scale up more inexpensive electric three-wheelers and small commercial vehicles (SCVs), the International Finance Corporation, a member of the World Bank Group, would invest Rs 600 crores at a worth of up to Rs 6,020 crores in the newly incorporated Last Mile Mobility Company (NewCo), which will be launched by Mahindra & Mahindra.

The details of the Asset/Business Transfer would be decided between the Company and NewCo following its incorporation and would then be communicated.

Electric vehicles provide vibration- and noise-free operation, increased wages for drivers, and micro-entrepreneurship. According to the corporation, the venture will create more jobs for women while also promoting equality and inclusion and boosting India's climate change program.

This is IFC's first investment in domestic EV manufacturing and the first in electric three-wheelers internationally. The investment will be made in one or more instalments of up to Rs 6,020 crores in the form of required convertible instruments. IFC would own between 9.97 per cent and 13.64 per cent of NewCo after investing Rs 600 crores.

The final mile mobility division will be housed at NewCo, which will include three-wheelers (Alfa, Treo, Zor) and four-wheeler SCVs (Jeeto). The IFC funding will assist NewCo in scaling electric mobility in last-mile connectivity.

While India's rising e-commerce activity and urbanization are driving a large growth in last-mile transportation, electric two- and three-wheelers have the potential to lead the transportation sector's clean energy transformation.

This investment ought to send out a signal of confidence in the future of such vehicles in India, allowing for enhanced connectivity and logistics for people and products, while also creating sustainable jobs and supporting the Indian economy.

IFC would receive certain rights upon subscription to CCPS, such as the right to appoint one nominee director on the Board of NewCo, the right to give voting instructions to the Company up to 11.8 per cent of NewCo's paid-up capital in tranches until conversion of CCPS, pre-emptive rights to participate in future funding rounds; affirmative voting and minority protection rights, transfer related rights, exit options, and so on.

The International Finance Corporation (IFC) is a member of the World Bank Group and the largest global development institution concentrating on the private sector in emerging nations. They work in over 100 countries, bringing finance, experience, and influence to developing countries in order to establish markets and opportunities.

M&M Auto sold 58,801 units in February, falling short of Nomura's expectation of 64,600 units. In February, total 3-wheeler sales (including EV) increased by 40% year on year to 5,350 units.

M&M stock has risen slightly since the IFC investment report and is trading near the lows in today's session.