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Mahindra Q1 net jumps, not decided on Ssangyong

Mahindra Q1 net jumps, not decided on Ssangyong
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First Published: Wed, Jul 28 2010. 02 31 PM IST
Updated: Wed, Jul 28 2010. 02 31 PM IST
Mumbai: Mumbai: Mahindra & Mahindra said it would wait for more information before deciding on a bid for South Korean SUV maker Ssangyong Motor, as it seeks to expand its vehicle line-up and pushes into new markets.
The largest Indian utility vehicles maker, which reported a forecast-beating 40% rise in quarterly net profit on Wednesday, said rising inflation and hardening interest rates remain a concern but was confident of meeting the challenges.
Mahindra, also India’s leading tractor maker, is among the six bidders shortlisted to make a bid for the troubled Korean firm, which has been under court-led restructuring since early 2009.
France’s Renault, Nissan Motor and India’s Ruia group are among the other bidders.
Mahindra is making a bid to be a significant player in the utility vehicles segment and later this year is scheduled to launch its Scorpio pick-up in the key US market.
At the same time its becoming a more diversified player and has launched both heavy trucks in a joint venture with US-based Navistar and its Gio mini-trucks to take on India trucks market leader Tata Motors.
Last year also saw the launch of three scooter brands from Mahindra, and in April, the company took over the sales of the no-frills Logan sedan in India by buying out the stake of French partner Renault.
A month later the company agreed to buy a majority stake in India electric vehicle maker Reva, making an entry into the small but fast-growing global electric vehicle industry.
Results
Mahindra reported a June quarter net profit of Rs562 crore ($121 million), compared with Rs401 crore a year earlier and Rs502 crore estimated in a Reuters poll of analysts.
Net sales rose to Rs5,124 crore from Rs4,229 crore.
The good results were due to higher volumes, focused cost control and lower interest expenses, the company said in a statement.
Rising raw material costs are a concern for car makers and last week this was one of the factors on which top car maker Maruti Suzuki saw a 20% fall in quarterly net profit.
The company sold 105,390 vehicles including utility vehicles, tractors, trucks and two-wheelers in the June quarter.
At 2.10 p.m., shares in Mahindra, valued at $7.6 billion, were up 1.1% while the main index fell 0.5%.
The stock has risen 16% so far this year, compared to a 13% increase in the sector index and a near 4% rise in the benchmark.
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First Published: Wed, Jul 28 2010. 02 31 PM IST