Mahindra and Mahindra Ltd posted a 17.83 per cent increase in consolidated net profit for the quarter ended in March 2023, driven by volume growth, and easing of commodity inflation. 

The company clocked ₹2,636 crore net profit during the quarter against ₹2,237 crore during the same quarter last year. Sequentially, the net profit dipped by 1.49 per cent to ₹2,676 crore registered in December. 

The company has also recommended a dividend of 325 per cent of ₹16.25 per ordinary share with a face value of ₹5 each.

The revenue from operations grew by 24.7 per cent to ₹32,365 crore in the quarter compared to ₹25,934 crore during the same quarter last year. Revenue from operations grew by 5.69 per cent as compared to the December quarter at ₹30,620 crore.

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For the full year 2023, the company’s profits crossed the ₹10,000 crore mark for the first time.

Key businesses

Mahindra and Mahindra stated that it was number one in the SUV segment with a market share of 19.6 per cent during the quarter and has open bookings of SUVs at 2,92,000 units as of May 1. Revenue growth of 34 per cent with strong volume across all key businesses was registered by the company. It saw electric three-wheeler volumes at 14,700 units during the quarter. 

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During the quarter, the automotive segment grew by 34 per cent year-on-year with ₹16,742 crores while the farm equipment segment grew by 29.86 per cent year-on-year with ₹8,023 crore. 

Rajesh Jejurikar, Executive Director & CEO (Auto and Farm Sector), M&M Ltd. said, “The response to new products has been very good with new launches planned over the next 12 months. The auto and farm equipment segment crossed 1.1 million vehicles in FY23. The efforts on cost management have led to consistent margin improvement while the decrease in the commodity prices helps the overall market and gives revenue effect.”

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The company’s farm equipment market share stood at 40.7 per cent during the quarter and the cash flow stood at ₹14,400 crore. 

Owing to semi-conductor constraints, the company saw up to 12,000 units of production loss for the quarter.

Revised capex outlook

Mahindra and Mahindra stated that it has revised the capex outlay between FY22 and FY24 to ₹15,900 crore with ₹1,600 crore investment in ICE vehicles for the anticipated regulatory changes and capacity expansion, and ₹1,125 crore for the electric vehicle segment to produce vehicles with changing requirements. ₹500 crore has been added to auto and farm investments. 

El Nino impact

The company stated that there was a low correlation between tractor sales growth with the El Nino impact and stated that with strong reservoir levels, they expect a low impact on volumes. It added that the average tractor industry growth was 8 per cent. 

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