Lidea Feed

M&M dominates the market for SUVs, LCVs, and tractors, and its Q2 earnings increased by 35%

Priya Verma November 07, 2024 08:27 PM

In the second quarter of Financial Year (FY) 25, Mahindra & Mahindra Limited (M&M) recorded growth, with consolidated Profit After Tax (PAT) rising by 35% year over year to Rs 3,171 crore.

In addition to leading the Indian market for SUVs, light commercial vehicles (LCVs), tractors, and electric three-wheelers, the business reported a consolidated revenue of Rs37,924 crore, which represents a 10% increase over Q2 FY24, according to a release.

With SUV volumes increasing by 18% in Q2 and 21% so far this year, M&M was able to hold onto its top spot in the SUV market with a revenue market share of 21.9%, up 190 basis points from the previous year.

In the tractor sector, M&M achieved a record Q2 market share of 42.5%, while its market share in LCVs under 3.5 tons grew to 52.3%. With a 43.6% market share, the business is also the global leader in the electric three-wheeler class.

With quarterly sales of 2,31,000 units—a 9% increase—the Auto segment achieved new heights. SUV sales reached a record-breaking 1,36,000 units.

PAT increased by 40% to Rs1,423 crore, while the segment’s consolidated sales increased by 15% to Rs21,755 crore. This expansion was aided by the Thar Roxx’s successful introduction and a 10% increase in SUV manufacturing capacity.

With volumes rising 4% year over year, the farm sector achieved its highest-ever Q2 market share of 42.5%. Notwithstanding several difficulties in the global market, the division’s income came to Rs8,194 crore. The margins improved to 17.5%, while the standalone profit before interest and tax (PBIT) increased by 20%.

Assets under management (AUM) increased by 20% for Mahindra Finance, while non-performing assets (GS3) improved to 3.8% and end losses decreased to 1%.

Tech Mahindra’s excellent success in the BFSI sector and a 490 basis point increase in the EBIT margin helped the business expand overall.

“This quarter, our businesses have produced a strong operating performance,” said Anish Shah, Managing Director & CEO of M&M Ltd. By increasing their market share and profitability, Auto and Farm maintained their position as the industry leader. End losses have improved structurally, and MMFSL GS3 stayed below 4% (at 3.8%).

“TechM had a strong quarter, and the long-term goal is still to return to previous profitability,” he said. The 5x challenge is going well for our growth jewels.