M&M Q2 PAT surges 67% to ₹3,452 cr; revenue up 17%

Auto major Mahindra & Mahindra group has reported a 67% jump in standalone profit at ₹3,452 crore in the July-September quarter of FY 2023-24 as compared to ₹2,068 crore profit in the year-ago period. The company’s revenue surged 17% to ₹25,773 crore while EBITDA rose 24% YoY to ₹4,397 crore vs ₹3,539 crore in the year-ago period.

M&M sold a total of 2,12,078 vehicles during the July-September quarter, recording an 18% rise, while the tractors' sales fell 4% to 89,101 as compared to 92,590 in the corresponding quarter last year.

"Mahindra & Mahindra Group delivered a robust operating performance across all businesses, except TechM. Auto grows rapidly, farm remains resilient despite tough market conditions and growth gems are on track," the company says via a stock exchange filing.

TechM's performance was impacted by "weak demand and exits" from non-core accounts.

Anish Shah, managing director & CEO, M&M Ltd says during Q2, operating performance across auto, farm and services was robust. “Auto rapidly grew to double its operating profit. Farm continues to be resilient despite tough market conditions.”

He says in services, Mahindra Fiances Limited had its lowest ever GS3 and turnaround is on track. “Growth gems are progressing well on the 5x challenge,” he adds.

Shah says TechM had a tough quarter. “We’re now initiating the transformation journey in the business. With H1 PAT growth of 18%, we are well on our way to delivering scale by transforming our core businesses and realizing the 5x challenge for growth gems.”

In terms of revenue, consolidated Q2 revenue was recorded at ₹18,869 crore, up 20%, while consolidated Q2 PAT at ₹1,015 crore, up 2X.

In the farm segment, the company says its tractor market share surged 41.6%, up 150 bps, which is the highest share in a decade. The segment reported a dip of 4% in consolidated revenue at ₹8,373 crore, while consolidated PAT was recorded at ₹800 crore, down 7%.

In the services segment, the profit dipped 48% on YoY basis, while revenue also fell 2%. M&M says its growth gems are on track. "Mahindra Lifespaces reported residential pre-sales of ₹455 cr., up 14%; Club Mahindra highest ever Q2 total income 333 cr., up 10%; Q2 member addition up 11; and Mahindra Logistics revenue ₹1,365 cr., up 3%."

Rajesh Jejurikar, executive director & CEO (auto and farm sector), M&M says the company maintained its SUV revenue market share at 19.9%, while further improving auto standalone PBIT margins. “In the tractor business, we increased our market share by 150 bps on the back of exciting new launches of Oja, Swaraj Target and Naya Swaraj. Our E-3W business continued market leadership with 61.1% market share.”

According to Manoj Bhat, group CFO, M&M delivered strong H1 F24 operating performance, with EPS at ₹52.4, up 18%. “With focus on operational metrics and value creation through our capital allocation actions, we continue to deliver RoE greater than 18%.”

Amid the development, M&M's shares are trading 1.93% down at ₹1,523.15 on the BSE. The passenger cars & utility vehicles maker's m-cap stands at ₹1,89,495.14 crore and the stock touched its one-year high of ₹1,670 on September 18, 2023.