Home grown auto-major Mahindra & Mahindra on Friday reported a consolidated profit of Rs 163 crore for the March quarter of 2020-21 as against a loss of Rs 3,255 crore in the year-ago quarter. Profit was impacted by an exceptional item worth Rs 838.89 crore, the company stated. "Exceptional item (net) of Rs 839.89 crore... represents impairment provisions for certain long-term assets and other exposures," M&M said.
The Mumbai-based company had also reported an exceptional item worth Rs 1,213.98 crore in the October-December period. The earlier loss of Rs 3,255 crore in Q4FY20 was due to a write down of its investment in South Korean Ssangyong and other global subsidiaries.
M&M’s revenue during recently concluded quarter grew by 48 per cent year-on-year basis to Rs 13,338 crore as it sold 1,06,333 vehicles (up 18 per cent YoY) and 93,044 tractors (up 58% YoY). Operating margin improved to 14.7 per cent compared to 13.6 per cent in the corresponding quarter previous year despite a significant strengthening in commodity prices, it said.
The automaker added that overall demand remained robust for its products in Q4FY21. However, the global shortage of semi-conductors has impacted production and sales.
Rajesh Jejurikar, executive director, auto and farm sector at Mahindra and Mahindra, said that the company is expecting demand for tractors in the Indian market to come back from June since the lockdown measures adopted by state governments is likely to be removed gradually.
"In auto, we might have to wait for a month or two before the demand comes back. Our conviction is that we will see a strong comeback of demand once the economy opens ...The semiconductor issue has impacted certain models. The supply side issues are expected to continue with the localized lockdowns," he said.