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Mahindra & Mahindra, India’s biggest tractor manufacturer, today reported a 150 per cent increase in stand-alone net profit in the December 2021 quarter, helped by an exceptional item pertaining to impairment provisions in the same quarter last year.

The Mumbai-based company posted a stand-alone net profit of ₹1,350.93 crore for the reporting quarter while the same quarter last year generated a net profit of ₹540.86 crore. M&M had taken an impairment provision of ₹1,213.98 crore in the quarter ended December, 2020.

Claims 1.55 lakh bookings

Revenue from operations at the stand-alone for the reporting quarter stood at ₹15,238.82 crore at the stand-alone level, a growth of 8.41 per cent as against ₹14,056.54 crore posted in the same quarter last year. The company claims to have a booking pipeline of 155,000 units.

Anish Shah, Managing Director and CEO, M&M said, “We have seen improved performance across multiple businesses. Our auto business has done well despite supply side challenges while our farm business has shown market share increase despite a slowdown in the market.”

Consistent rise in expenses dented margins of the company. Total expenses rose 14 per cent during the December, 2021 quarter. The company did carry out price hikes to offset the input cost pressure during the quarter.

To create reserve stock of critical chips

Shortage of semiconductors impacted the company during the quarter. M&M suffered a production loss of 20,000 units due to shortage of electronic control units (ECUs). M&M said it is creating a new source for fungibility as well as create reserve stock of critical chips.

The board of M&M has cleared the sale of 9.24 acre, which is part of the land factory situated at Kandivali, Mumbai to Mahindra Lifespace Developers (MLDL) for ₹365 crore.

The proceeds will be received in tranches and interest at 7 per cent per annum receivable during the interim period of payment on unpaid principal balance from the sale date. The project will offer approximately 1 million sqft of carpet area and is expected to be launched in FY 2023.

Arvind Subramanian, Managing Director & CEO, Mahindra Lifespace Developers, said, “Kandivali East is a strategically located, thriving residential hub in Mumbai, and offers well-developed social and civic infrastructure and amenities. This latest land acquisition will help us grow our presence in this high-performing micro-market and is in line with our expansion strategy in Mumbai.”

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