Mahindra & Mahindra Ltd. (M & M) and its 100% subsidiary Mahindra Vehicles Manufacturers Ltd. (MVML) reported a 73% lower net profit of £ 380m in the quarter ended December 31 due to sluggish vehicle sales. This is in comparison to a net profit of 1,396 crore in the previous year.
Sales fell 6% to £ 12,120 crore. The company sold 1.23,353 units during the quarter, compared to 1.33,508 units in the same period last year, a decrease of 7.6%. Tractor sales decreased by 6.4% to 81,435 units. Exports, including vehicles and tractors, decreased 22% to 9,633 units. "The third quarter results for fiscal year 2020 include a £ 554 billion net loss from exceptional items and one-time items compared to a £ 519 billion net profit from exceptional items and one-time items in Q3 F2019," the company said in an explanation.
The company said that both the Indian auto and tractor industries showed signs of a turnaround in the third quarter of 2020 and saw moderate double-digit growth in the two previous quarters. "Good monsoons, the demand for holidays, improved liquidity conditions, new launches, especially in the area of commercial vehicles (UV), and special OEM regulations for the automotive industry were the main reasons for this slowdown in growth," it said.
“The unusual rains in October 2019 did 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 very good water reservoir levels and the announcement the government was given support for infra-projects, ”it said. For the quarter that ended in December, M&M reported single sales of £ 12,345 billion compared to £ 13,070 billion in the same period last year. The net profit was 307 crore, compared to 1,077 crore in the previous year.
The company also announced that M & M's board of directors after the Securities and Exchange Board of India, which had postponed the deadline for compliance with the chairmanship of standards, asked Anand Mahindra, the office of executive chairman to continue until his original term until November 11th. 2021. Mr. Mahindra followed the request.
Dr. Pawan Goenka and Dr. Anish Shah would continue to report to Mr. Mahindra.