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Automobile and tractor company Mahindra & Mahindra on February 5 reported a massive 39.6 percent year-on-year growth in profit at Rs 530 crore for the quarter ended December 2020.
The company had an exceptional loss of Rs 1,213.98 crore for the December quarter, representing impairment provisions for certain long-term assets and other exposures. The profit before exceptional loss stood at Rs 1,745 crore for the quarter. Revenue from operations grew by 16 percent year-on-year to Rs 14,056.5 crore in Q3FY21, with strong tractor volumes.
The company sold 97,420 tractors in the domestic market in Q3FY21, registering a 20 percent growth over the corresponding period on the robust rural story but automotive business sales fell 7 percent to 1,15,272 vehicles as some significant challenges do exist, especially on the supply side and commodity prices, M&M said.
At the operating level, its EBITDA rose by 33.4 percent to Rs 2,385.6 crore and margin expanded 220 bps to 17 percent compared to the corresponding quarter, driven by cost optimization and operating leverage. Revenue from its automotive business grew by 12 percent year-on-year to Rs 8,311 crore with its EBIT rising 13.4 percent and margin expanding 10 bps YoY, for the quarter ended December 2020.
“Growth momentum for the tractor industry was supported by positive sentiment in rural parts of the country, specifically the agri economy which is driven by (i) Very good monsoon (ii) Healthy reservoir levels (iii) record kharif production (iv) good rabi sowing (v) Continued high central government spending in agriculture and rural development,” said the company.
M&M Q3 Profit Jumps 40% to Rs 530 Crore
