MUMBAI: Automaker Mahindra & Mahindra (M&M) Ltd on Tuesday reported a 70 per cent increase in its standalone net profit at Rs 1,060 crore for the March quarter against Rs 622 crore a year before. It’s consolidated profit shot up 50 per cent at Rs 1,155 crore.
M&M’s revenue during the period rose 10.5 per cent to Rs 13,308 crore, largely due to an increase in segments like farm equipment, hospitality and financial services. While the revenue from farm equipment segment rose 33 per cent to Rs 3,716 crore, revenue from hospitality and financial services shot up by 31 per cent. Automotive segment, however, registered a marginal growth of 2.5 per cent at Rs 9,136 crore.
Pawan Goenka, MD, M&M, said better-than-expected monsoon and pick up in infrastructure is expected to drive sales and the company anticipates a growth of 8-10 per cent in tractor sales and 10-12 per cent growth in commercial vehicle sales in the current financial year. Though Goenka believes rising oil and commodity prices will impact the auto industry, rural markets are expected to keep up the momentum. The company’s utility vehicle sales too are likely to gain traction following new product launches this fiscal.
To keep up with the momentum, M&M is planning to invest Rs 15,000 crore over the next three years. Of this, Rs 10,000 crore comprises capital expenditure to increase capacity of its utility vehicles, tractors and commercial vehicles, besides product development. The increased focus on these products was largely because sales of tractors, and passenger and commercial vehicles registered a growth of 10 per cent last fiscal, which Goenka believes will remain so even during the current year.