M&M hints at price hike on surging input costs

M&M hints at price hike on surging input costs

New Delhi: Farm equipment and utility vehicles major Mahindra & Mahindra on Monday said it could consider effecting a price hike due to rising input costs.

M&M president for automotive sector Pawan Goenka told reporters that there has been a surge in commodity prices, specially that of rubber and sheet metals, which has resulted in pressures on margins.

“At the moment we are absorbing the prices as much as we can but if they continue to rise, then we might have to pass it on to the consumers," Goenka said, on the sidelines of a meeting on Environmental Friendly Vehicles here. But he declined to comment on the specifics like timing and the quantum of a probable price hike.

“Yes, we are feeling the pressure and all companies are feeling it," he said, when asked if the company is under pressure due to the rising input costs.

Goenka said in the second quarter, the company had posted margins which have been “one of the best in many years", but it would be difficult to maintain the same kind of margins in the third and fourth quarters because of the increase in the prices of rubber and sheet metals.

The country’s largest utility company had reported a profit after tax at Rs702.9 crore on a gross revenue of Rs5,188.9 crore in the second quarter ended September.

Commenting on the company’s bio-diesel project, Goenka said M&M has already tied up with a company called Earth100 and is running a fleet of 10 Scorpios powered by 100 per cent bio-diesel.