New Delhi: Domestic automaker Mahindra & Mahindra (M & M) reported a 73 percent drop in consolidated profit to rupees 380 billion for the December quarter of 2019 due to sluggish vehicle sales on Saturday.
The company had a profit after tax (PAT) of 1,396 rupees in the same quarter of the last financial year, according to a statement by M & M.
"The results of Q3 F2020 include a net loss from exceptional and one-time items of Rs 554 crore compared to a net loss from exceptional and one-time items of Rs 519 crore in Q3 F2019," it said.
Revenue declined to 12,120 rupees in the last quarter, compared to 12,893 rupees in the same period last year.
Vehicle sales in the third quarter were 1.23.353 units compared to 1.33.508 units in the same period of the previous year, which corresponds to a decrease of 8 percent.
Tractor sales also fell 6 percent to 81,435 units in the third quarter, after 87,036 units in the same period of the previous year.
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Vehicle and tractor exports decreased 22 percent to 9,633 units in the last quarter, compared to 12,363 units in the same period last year.
However, the Indian auto and tractor industry showed signs of a turnaround in the third quarter and weakened double-digit growth in the first half of the year.
Good monsoons, the demand for holidays, improved liquidity conditions, new launches, especially in the commercial vehicle (UV) sector, and special regulations from OEMs for the automotive industry are the main reasons for this slowdown in growth.
The unusual rains in October 2019 have done some damage to the Kharif crop, but the mood in the agricultural and rural economies is quite positive as the Rabi crop has been well sown, thanks to a very good water table and government announcement to support infrastructure projects.
In the future, the supportive and coordinated interplay of monetary and fiscal policies will be of paramount importance for reviving growth.
The Union budget has reaffirmed its commitment to doubling agricultural income and has given agriculture and the rural sector a boost.