Commodity inflation and shortage of semiconductors continue to impact Mahindra & Mahindra’s operating margin, which stands at 11.9% in Q3FY22. However, supplies improved over Q2FY22, reflecting higher volumes in Q3 F22 Q-o-Q.
The company reported 56.7% growth in its consolidated profit to INR 1,987.44 crore during the quarter against INR 1,268.23 crore during the same period last year. The consolidated revenue from operations stood at INR 23,594.46 crore in Q3 FY22 as against INR 21,625.96 crore in Q3 FY21, witnessing a growth of 9%.
On a standalone basis, the company registered 154% growth in its profit to INR 1,353 crore during the quarter compared to INR 530.86 crore in the same quarter of the previous year.
The revenue from operations also grew by 8.4% to INR 15,238.82 crore in the three months ending December 31, 2021, compared to INR 14,056.64 crore during the same period last year.
The company said that the automotive segment had a healthy booking pipeline and buoyant demand for its products. There were about 155,000 total open bookings, out of which 70,000 plus are for XUV7OO. The quarter also turned out to be the highest ever quarterly sales for Treo Auto and Treo Zor in the EV 3-wheeler segment. In addition, stringent cost control measures have helped partially mitigate the margin impact of commodity inflation, the company said.
The farm equipment business delivered an improved performance with the second-highest Q3 in terms of PBIT domestic volumes. The market share also grew by 1.4% in Q3. CODE by Swaraj, a farm machine launched last November with innovative features, which can be used for weeding, spraying, earthing up for horticulture crops and harvesting grain crops, gained customer acceptance, the company added.
Commenting on Q3 FY22 performance, Dr Anish Shah, Managing Director & CEO, M&M Ltd, said, “We have seen improved performance across multiple businesses as reflected in our consolidated performance. Our auto business has done well despite supply side challenges while our farm business has shown market share increase despite a slowdown in the market.”
Rajesh Jejurikar, Executive Director, M&M, said, “Demand for the entire automotive product portfolio remains strong. The order book for XUV 700 and Thar reflects the customer and market success of these new launches. With better availability of semiconductors, we hope to build the volume growth momentum in Q4 F22. FES gained 140 basis points market share YOY in Q3 F22 and delivered robust financial metrics despite market slowdown and steep commodity inflation”.
Manoj Bhat, Group Chief Financial Officer, M&M, said, “Our focus on capital allocation and profitability has led to a steady increase in RoE over the last few quarters. We remain committed to delivering on our growth and return objectives.”