Mahindra & Mahindra net profit declines 6% on higher expenses

Mahindra & Mahindra Q1 earnings: Mahindra & Mahindra, the country's largest sports utility vehicle and tractor maker, on Wednesday said that its consolidated net profit in first quarter of current financial year declined 6.43 per cent to Rs 3,282.63 crore from Rs 3,508 crore in the same period last year.

The decline in profit came on the back of rise in expenses. Its total expenses in June quarter rose 9 per cent annually to Rs 33,330 crore as against Rs 30,492 crore in the year ago period.

The XUV700 maker's revenue from operations rose 11 per cent to Rs 37,010 crore from Rs 33,406 crore in the corresponding period last year.

On a standalone basis, Mahindra & Mahindra's net profit declined 5 per cent to Rs 2,613 crore while its earnings before interest, taxes, depreciation, and amortisation (EBITDA) also known as operating profit rose 16 per cent to Rs 4,116 crore.

During the quarter company sold 2,11,550 vehicles, up 14 per cent from 1,86,138 units sold during the first quarter of previous financial year.

Total tractor sales rose 5 per cent to 1,20,492 units.

“We have started the F25 fiscal year with strong operating performance across all our businesses. Capitalising on leadership positions, Auto and Farm continued to expand market share and profit margins. Transformation at MMFSL is yielding results as asset quality improves and transformation at TechM has commenced with margins as a key focus. With this momentum and relentless drive towards execution, we will continue to ‘deliver scale’ in F25,” said Anish Shah, Managing Director & CEO, M&M.

Mahindra & Mahindra shares rose 1.2 per cent to Rs 2,956 after its earnings announcement.