Mahindra and Mahindra (M&M), the country’s biggest utility vehicle manufacturer, on Friday beat estimates by reporting a 21.78% year-on-year increase in its standalone net profit at R1,163.27 crore for the quarter ended September 30 on the back of substantial increase in sales of utility vehicles and tractors.
Revenues during the period also beat estimates and increased by 14.98% y-o-y to R11,166.22 crore as the company reaped the benefits of launching two compact SUVs — Tuv 300 and Kuv 100 — and a better monsoon.
“The lagged effects of the interest rates cut by RBI along with increased transmission of lower interest rates will also be supportive of consumption. All of these bode well for broad-based consumption-led growth in coming quarters,” M&M said in a statement.
The company paid 35% more excise duty when compared to the same quarter last fiscal as the tax exemption in the Haridwar plant ended last fiscal. At an operational level the Ebitda (earnings before interest, tax, depreciation and amortisation) increased 22.3% y-o-y to R1,233.12 crore when compared to R1,008.22 crore in the corresponding quarter last fiscal. Due to increase in the revenues and controlled expenses the operating margins increased by 66 basis points y-o-y to 11.04%.
Other income of the company increased by 46.17% to R707.5 crore due to higher dividend received from subsidiaries.
At a consolidated level — M&M and MVML — the company reported a 29% y-o-y increase in net profit at R1,253 crore, while revenues increased by 18% y-o-y to R12,049 crore. During the quarter the sales of utlity vehicles were up by 15.6% y-o-y to 52,287 units in the domestic market. M&M’s tractor volumes increased by 36.9% y-o-y to 57,863 units during the same period.