Utility vehicle major Mahindra & Mahindra (M&M) on Monday announced a marginally higher net profit of Rs.761.50 crore (Rs.738 crore) for the second quarter of current fiscal. The company has combined the figures of Mahindra Vehicle Manufacturers (MVML), its 100 per cent subsidiary, as it is a critical segment of its business and the combined results provide a more comprehensive view of performance.
The company could maintain its profits despite the relentless increase in material costs due to a good volume performance by vehicles and tractors in a difficult market and a tight control on expenses.
The combined gross revenues and other income grew 34 per cent at Rs.8,298.80 crore (Rs.6,199.60 crore). During the quarter, M&M suffered a net loss of Rs.32 crore on account of the precipitous fall in the rupee against the U.S. dollar towards the end of the quarter and the consequent revaluation of its external commercial borrowings repayable largely in 2016. Excluding the impact of this exchange difference, the net profit during the quarter was Rs.783.10 crore (Rs.738.80 crore). The operating margin excluding the above exchange difference is 13.3 per cent.
On a standalone basis, M&M's net profit dipped marginally to Rs.737.40 crore (Rs.758.50 crore). However, excluding the impact of exchange difference, the net profit is almost unchanged at Rs.759 crore.
Gross revenues and other income were up 33.2 per cent at Rs.8,198.70 crore (Rs. 6157.30 crore) and the operating margin after adjusting for the exchange difference is 12.3 per cent.
In the passenger utility vehicle segment, sales grew 14.2 per cent at 47,523 vehicles and M&M maintained its position with 54 per cent share of the market.
