BackM&M Q2 results: Net profit jumps 46%, beats estimates
M&M Q2 results: Revenue from operations jumped 56.5% during the quarter to ₹20,839 crore.
PremiumAutomaker Mahindra and Mahindra (M&M) reported a better-than-expected second-quarter profit, driven by strong demand for its passenger vehicles and farm equipment. Mahindra reported a profit after tax of ₹2,090 crore, up 46% from ₹1,433 crore a year earlier. Total vehicles sold soared 75% from a year ago to 174,098 units, while it had open bookings for more than 260,000 SUVs.
In comparison, analysts in a Reuters poll were expecting a profit of ₹1,988 crore. M&M shares were trading flat at ₹1,279 on BSE but the stock is up over 50% year to date in anticipation of recovery of passenger vehicle sales.
“Strong set of numbers from M&M. Outperformance was seen on topline as both the auto as well as farm equipment segment performed robustly. Margins at 12% were in line with expectations. Auto as well as FES (farm equipment) margins grew on a qoq basis. At the bottom line, higher other income and good operational performance led to an above expected growth. Remain BUY," said Ashwin Patil, Senior Research Analyst at LKP Securities.
Revenue from operations jumped 56.5% during the quarter to ₹20,839 crore. Earlier, rival Maruti Suzuki India reported a four-fold jump in quarterly profit, while Tata Motors saw its loss narrowing from a year ago on strong demand.
Anish Shah, Managing Director & CEO, M&M Ltd, said, “ Our robust financial results reflect the progress we have made on our strategic imperatives. While the auto segment has led growth, we have seen steady performance across our group companies."
Mahindra farm equipment sector saw the highest second-quarter volume while the auto segment achieved the highest-ever quarterly volume, the company said, adding that exports for both vehicles and tractors remained strong.
Rajesh Jejurikar, Executive Director, M&M Ltd, said, “It has been an action-packed quarter with multiple product launches and new products across segments, in addition to partnership announcements with BII and Volkswagen. We recorded our highest quarterly revenue for Auto and Farm segments. In SUVs, we continue to be the Revenue market share leader. Festive sales have been strong this year across Auto and Farm sectors. With the unveil of the XUV4OO and our Born Electric Vision, we enter the Electric SUV segment and aim to establish leadership position in the future.“
While demand for passenger cars has been strong, Indian automakers, including Mahindra, are seeing an easing of semiconductor shortages and higher raw material costs, which have hampered the industry since the pandemic. Passenger vehicle sales for September in India nearly doubled to 307,389 units from a year ago.
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