Mahindra & Mahindra reports a 214% YoY growth

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Automobile and tractor maker Mahindra and Mahindra on November 9 reported a 214 percent year-on-year growth in profit at Rs 1,929 crore for the quarter ended September 2021 due to a low base but the operating performance was hit by higher input prices.

The results include the numbers for Mahindra Vehicle Manufacturers Limited, its commercial vehicle segment.

In Q2FY21, profit was hit by impairment losses.

“Commodity prices have impacted our margins in both the auto and farm business but our focus on cost management and optimization has helped mitigate some of the impacts,” Group Chief Financial Officer Manoj Bhat said.

Revenue from operations grew by 14.8 percent year-on-year to Rs 13,305 crore, beating CNBC-TV18 poll estimates of Rs 12,348 crore for the September 2021 quarter.

“We have a very healthy booking pipeline and buoyant demand for the company’s products in the automotive segment. A global shortage of semi-conductors has impacted the production and sales for another quarter,” M&M said.

In the case of farm equipment, “farm business delivered an excellent performance with second-highest Q2 in terms of PBIT (profit before interest and tax), domestic volumes, and export volumes. We have a healthy growth of 1.9 percent in market share for M&M,” it added.

In the automobile segment, Mahindra & Mahindra sold 99,334 vehicles during the quarter, increasing 9 percent YoY but tractor sales fell 5 percent YoY to Rs 88,920 crore.

Executive Director Rajesh Jejurikar said with better availability of semi-conductors, they hoped to maintain the volume growth momentum Q3.

At the operating level, earnings before interest, tax, depreciation, and amortization (EBITDA)  declined 19.3 percent year-on-year to Rs 1,660 crore and the margin dropped 530 bps YoY to 12.5 percent in Q2FY22, dented by higher input prices. The stock was trading at Rs 873.65 on the BSE, up 1.68 percent at 2.14 hours pm.