Benefiting from the robust performance of its automotive segment, favorable product mix, and operating leverage, Mahindra & Mahindra (M&M) saw its standalone net profit soar by 60 percent Year-on-Year (YOY) to Rs 2,454 crore. This marked a significant increase from the Profit after Tax (PAT) of Rs 1,528.06 crore recorded during the same period last year.
The Mumbai-based automaker’s revenue for the fiscal third quarter also witnessed substantial growth, climbing 16 percent year-on-year to Rs 25,642.4 crore, primarily driven by strong volume growth in the automotive segment. Comparatively, turnover during Q3 FY 2022-23 stood at Rs 21,653.74 crore.
M&M’s performance surpassed analysts’ expectations, with the company’s standalone net profit projected to rise 45 percent YOY to Rs 2,212.46 crore, as per the average estimates of five brokerage firms. Moreover, the company’s earnings before interest, taxes, depreciation, and amortization (EBITDA) increased by 9.7 percent to Rs 3,590.3 crore, compared to Rs 3,273 crore reported in Q3 of FY23. The operating margin also expanded by 80 basis points to 14 percent in the third quarter of this fiscal.
In terms of volumes, M&M witnessed an 11.1 percent YOY increase to 3,13,115 units in Q3FY24, with auto sales rising by 20.1 percent YOY to 2,11,443 units, while tractor volumes experienced a 4 percent decline from the previous year to 1,00,522 units during the same period.
Rajesh Jejurikar, Executive Director & CEO (Auto and Farm Sector) of M&M Ltd., expressed satisfaction with the company’s performance, particularly in both the auto and farm businesses. He noted, “We were #1 in SUVs with revenue market share of 21 percent in Q3 while further improving our auto standalone PBIT margins. We increased tractor market share by 80 bps to 41.8 percent in Q3 even as the overall industry contracted on back of last year’s high base, weather vagaries and lower reservoir levels. Our E-3W business is maintaining its market leadership with Q3 market share of 54% and YTD market share of 59.5 percent.”
At a consolidated level, M&M reported a 34 percent increase in its consolidated profit after tax to Rs 2,658 crore for the third quarter ended December 31, 2023, driven by robust sales across verticals. Its revenue also witnessed a 15 percent increase to Rs 35,299 crore for the period under review, compared to Rs 30,621 crore in the year-ago period.
Dr. Anish Shah, Managing Director & CEO of M&M Ltd., commented on the performance, stating, “Our businesses have delivered a solid operating performance this quarter. Auto continues to gain market share and grew rapidly to double its profit. Farm has gained market share despite tough market conditions.” He further added, “TechM is working through challenging operating results but I feel good that the right actions are being taken to turnaround its performance.”
