India’s largest sports utility vehicle (SUV) maker Mahindra & Mahindra (M&M) managed to report marginal profit during the fiscal first quarter thanks to timely unlocking activity in the country.
It reported a consolidated net profit of Rs 68 crore, down 97% on year during April-June quarter. It had reported net profit of Rs 2,260 crore in the year ago period. The figure includes profit from its manufacturing unit MVML.
Sales plunged to Rs 5,589 crore, down 56% from Rs 12,805 crore a year ago.
After the first ever zero sales in April, the automobile industry is finding its way back. M&M’s key brands with strong rural presence have seen good demand in June.
Low pipeline inventory coupled with the challenges of ramping up the production from supply chain issues affected M&M’s sales.
It sold 27,565 units of vehicles and 64,140 units of tractors during the quarter under review, down 78% and 22% on year. Total exports were at 3,109 units, down 72%.
The government’s effort to provide support to the economic has been positive, there remains a need for further support from the government on the demand side.
Meanwhile, the board of the company also approved to seek shareholder approval to reduce its stake in SsangYong Motor Company, a material subsidiary of the Company based in Korea to less than 50%.
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