NEW DELHI: Homegrown automaker Mahindra & Mahindra posted a 26 per cent rise in consolidated net profit for the second quarter, even as it saw operating margins contract. According to details disclosed, the combined profit of Mahindra & Mahindra (M&M) and its manufacturing arm Mahindra Vehicle Manufacturers Limited (MVML) stood at `1,779 crore as against `1,411 crore for the same quarter last year.
According to the company, while total domestic sales volume has grown at 8.8 per cent year-on-year during the quarter, heavy commercial vehicle sales surged, recording 48.1 per cent growth. The shift in the festive season, one of the most lucrative sales seasons for automobile firms, from the second to the third quarter this financial year also affected volume growth during the period, especially in tractor sales.
“The domestic tractor industry witnessed a decline of 2.6% in Q2 F2019 on account of shift in festive season to Q3 F2019 which resulted in the company’s domestic tractor sales also declining by 5.2% in Q2 F2019,” it said, adding that with healthy reservoir levels, progress on rabi sowing and increase in minimum support prices of Rabi crops, it expected growth momentum to pick up in the coming months.
Managing director Pawan Goenka also noted that passenger vehicle sales might not achieve double digit growth this financial year. “Looking at what happened in the second quarter and the just concluded festive season, I would think it would be difficult to get a double-digit growth in the passenger vehicle segment this fiscal. I’d expect the fiscal to end with a 7 percent or may be 8 percent,” he said.