Utility vehicle and tractor maker Mahindra & Mahindra’s third quarter profit fell 5.7 percent to Rs 801 crore compared with Rs 849.4 crore in corresponding quarter of last fiscal, hit by automotive segment but supported by tractor business.
Revenue (including Mahindra Vehicle Manufacturers) during the quarter increased 1.2 percent year-on-year to Rs 10,586.8 crore, with automotive segment down 8.3 percent at Rs 6,358.93 crore and tractor business growing 20.2 percent to Rs 4,280.65 crore.
Automotive business was impacted by demonetisation while better monsoon helped tractor segment.
Overall sales volume growth was 2 percent at 1.97 lakh units, supported by tractor sales that grew by 22 percent to 76,486 units but impacted by auto sales that fell 7.6 percent to 1.2 lakh units on year-on-year basis.
Operating profit slipped 0.1 percent to Rs 1,449 crore and margin contracted by 20 basis points to 13.7 percent in the quarter gone by, which beat analysts’ estimates.
Topline and bottomline missed analysts’ expectations. Profit was estimated at Rs 850 crore on revenue of Rs 10,800 crore and operating profit was expected at Rs 1,401 crore with margin at 13 percent for the quarter, according to average of estimates of analysts.
Auto segment’s EBIT (earnings before interest and tax) margin contracted by 320 basis points year-on-year to 7.1 percent while tractor business margin expanded by 199 basis points to 17.42 percent in the quarter ended December 2016.
At 15:20 hours IST, the stock was quoting at Rs 1,278.75, down Rs 13.30, or 1.03 percent on the BSE.
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