M&M consolidated net soars 28%

Auto major Mahindra & Mahindra on Thursday posted a consolidated net profit of 28.4 per cent at Rs 978.1 crore (Rs 9.78 billion) in July-September quarter on the back of robust sales in utility vehicles.

Standalone profit was 22.30 per cent at Rs 901.8 crore (Rs 9.01 billion) in the same quarter from Rs 737.4 crore (Rs 7.37 billion) reported in the year-ago period.

The consolidated sales rose to Rs 10,786.7 crore (Rs 107.87 billion) in the period under review as against Rs 8,235.8 crore (Rs 82.36 billion), a growth of 31 per cent, the company said in a statement.

The revenue from automotive sales jumped 58 per cent in the quarter, driven by surging demand for SUVs defying the gloom in the overall car sales, which has been on a downhill for the past many quarters, it said.

The company said the consolidated numbers include those of its fully-owned subsidiary Mahindra Vehicle Manufacturers (MVML), based in Chakan, Pune, that is into sourcing contemporary products from the Group's overseas arms.

This company had last week rolled out its first premium SUV, the Rexton, from the Korean subsidiary of M&M SsangYong Motors.

During the quarter under review, passenger utility vehicle sales grew 32 per cent to 62,751 units. In the reporting quarter, the company also launched its first compact SUV Quanto.

In the car segment, it sold 4,899 units of the Verito sedan, which is its sole offering in the space and was developed from its erstwhile partner Renault of France.

"The growth in profit is in spite of the relentless increase in material costs is due to good volume performance by the automotive sector and tight control of expenses," the company said.

Company's domestic tractor sales, however, dropped 13.8 per cent in the reporting period on the back of late start to the monsoon.

The overall tractor sales dipped 12 per cent during the quarter. However, for the first half, its margins were at 13.9 per cent, according to the company.

Company shares closed up 3.6 per cent to Rs 857.55 after touching a high of Rs 863.55, or over 4.3 per cent, on the BSE.

Mahindra & Mahindra (M&M) is the global leader in tractors by volume, and also leads in the domestic market with 40.3 per cent share.

In the domestic SUV space, it leads with a whopping 45.4 per cent of the market pie at the end of the reporting quarter.

Overall exports rose 43 per cent to 10,349 units from 7,239 units in the year-ago quarter, it said.

Tractor sales, in the wake of a below normal monsoon, witnessed a 13.8 per cent de-growth to 47,065 units against 54,585 units in Q2 last fiscal. Tractor exports rose 11.1 per cent to 3,043 units (worth Rs 231.3 crore) in the quarter under review.