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Mahindra & Mahindra Ltd on Friday posted a consolidated net profit of ₹368.43 crore in the second quarter of the current fiscal, down 78.44 per cent from ₹1,708.92 crore it had posted in the corresponding quarter of last year. Profit was down 24 per cent to ₹1,355 crore if numbers reported by Mahindra Vehicle Manufacturers Ltd are also considered.
The total revenue from operations for the quarter under review stood at ₹23,935.93 crore (₹25,431.02 crore).
“Despite such a challenging environment leading to a volume drop in both its segments, the company with strong emphasis on cost management, ensured that the EBITDA drop was in line with the revenue decline. The company also successfully increased its market share in tractors as well as passenger vehicles. This has enabled the company to achieve its highest OPM margin in the last four quarters. Q3 has started on a positive note with good deliveries (retails) both in the automotive as well as tractor segments,” M&M said in a release.
Growth in market share
“In the context of the industry scenario, Mahindra had a market share growth in almost every sub-segment we are competing in. We had a huge growth in tractors (1.5 per cent), we had a good growth in passenger vehicles (0.8 per cent), and a decent growth in the pick-up segment,” said Pawan Goenka, Managing Director, Mahindra & Mahindra Ltd.
In the second quarter of FY2020, the overall domestic sales of M&M fell 21.5 per cent to 1,10,824 units, down from 1,41,163 units in Q2 of FY2019.
The passenger vehicle segment witnessed a fall of 26.6 per cent, from 60,867 units of Q2 FY2019, to 44,667 units of Q2 FY20.
Sales of utility vehicles fell 22.9 per cent, from 55,656 units of Q2 FY2019 to 42,898 units in the second quarter of this year.
In the commercial vehicles segment, sales fell 20.8 per cent to 49,525 unit (62,527 units). In three-wheelers, sales fell 6.4 per cent to 16,632 units (17,769 units). In exports, volumes fell 15 per cent to 7,826 units (9,244 units).
The tough industry is reflected in the growth rate — which has plummeted — and the company’s relative performance is reflected in the market share, said VS Parthasarathy, Group CFO, Mahindra & Mahindra Ltd.
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