Mahindra & Mahindra Q2 Net Grows by 9.7%

The Board of Directors of Mahindra and Mahindra Limited today announced the unaudited financial results for the quarter ended 30th September 2013 for the company.

Mahindra Vehicle Manufacturers Limited (MVML), located at Chakan near Pune, was set up as a 100% subsidiary of the company with a view to sourcing contemporary products for expanding the market offerings of the company. Hence it is a critical part of its business and only the combined results of the company and MVML can provide a comprehensive view of company’s performance.

In the Passenger Utility Vehicle segment, the Entity sold 47388 vehicles in the current quarter with a market share of 39.6%. In the Cars segment, the Entity sold 2879 Verito and Verito Vibe Cars. The Entity also exported 8059 Vehicles in Q2 F2014.

Mahindra & Mahindra Q2 Net Grows by 9.7%

The Gross Revenues and Other Income of Mahindra & Mahindra Ltd. for the quarter ended 30th September 2013 is Rs. 9890.6 crore as against Rs. 10891.4 crore during the corresponding period last year. The Net Profit after tax for the quarter is Rs. 989.5 crore as against Rs. 901.8 crore in the same period last year – a growth of 9.7%.

The Gross Revenues and other income of Mahindra & Mahindra Ltd. during the half year ended 30th September 2013 is Rs. 20778.4 crore as against Rs. 21007.2 crore in the corresponding period previous year. The Profit after tax for the current H1 is Rs. 1927.4 crore as against Rs. 1627.4 crores in H1 previous year – a growth of 18.4%.

The consolidated Gross Revenues and Other Income of the Group for the Quarter ended 30th September 2013 grew by 3.9% to Rs. 18675.6 crore (USD 3.3 billion) from Rs.17973.4 crore (USD3.2 billion) in Q2 last year. On account of a change in the status of Tech Mahindra from a Joint Venture to an Associate effective 31st Aug 2012, the revenues reported above include M&M’s share of Tech Mahindra revenue for 2 months only in Q2 F2013. On a like to like basis the growth in the consolidated revenues in the current quarter is 6.6% over Q2 F2013. The consolidated profit after tax before minority interest for the current quarter is Rs. 927.4 crore (USD 163.6 million) as compared to Rs. 786.8 crore (USD 138.8 million) in Q2 previous year a growth of 17.8%. After deducting minority interest, the profit after tax for the current quarter is Rs. 835.7 crore (USD 147.4 million) as compared to Rs.798.7 crore (USD 140.9 million) in the previous year.

The Group’s recent acquisition Ssangyong Motor Company Limited, S. Korea, which had broken even in Q1, continued its profitable ways with a 20% growth in consolidated revenues and a 114% growth in results. The performance of Tech Mahindra with a 39% growth in consolidated revenues and a 58% increase in profits and that of Mahindra Finance with a 32% growth in consolidated revenues and a 21% growth in profits, were particularly noteworthy.

The Gross Revenues and Other Income for the half year ended 30th September 2013 grew by 10.4% to Rs. 38031.6 crore (USD 6.7 billion) from Rs. 34455.8 crore (USD 6.1 billion) in H1 last year on a comparable basis. The consolidated Profit after tax before minority interest for the current half year is Rs 1980.7 crore (USD 349.4 million) as against Rs 1806.5 crore (USD 318.7 million) in H1 last year – a growth of 9.6%. After deducting minority interest, the profit after tax for the current Half year is Rs. 1803.8 crore (USD 318.2 million) as compared to Rs.1825.1 crore (USD 321.9 million) in the same period of previous year.

The Group as on 30th September 2013 comprised of 130 Subsidiaries, 7 Joint Ventures and 10 Associates. A full summation of Gross Revenues and other income of all the group companies taken together for H1 F2013 is Rs. 47442.7 crore (USD 8.4 billion).

The Indian economy continues to struggle. With domestic demand weakening and manufacturing activity stagnating, growth in the first quarter of F2014 dropped to 4.4% and is likely to see only marginal improvement, if at all, in the second quarter. At the same time, inflation remains high and rising, limiting the space for growth supportive monetary policy action. Nevertheless, we expect the economy to perform better in the second half of this fiscal. First, as a result of both domestic policy actions and the US Fed maintaining status quo, near term balance of payments risks facing the Indian economy have eased, stabilizing the Rupee and thus limiting cost-push inflationary pressures on the economy. Second, the robust agricultural harvest expected in the coming months is likely to dampen inflation while simultaneously boosting rural output, incomes & demand and thereby, productive activity in other segments of the economy. Finally, with the advanced economies recovering, and the rupee no longer over-valued, exports should pick up speed in the coming quarters. Given these encouraging pointers, our current outlook on the economy is one of cautious optimism

Note: Translation of rupee to dollar is a convenience translation at the average exchange rate for the twelve month period ended 30th September 2013.

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