M&M Q1 net declines 3.4%

M&M Q1 net declines 3.4%

Mahindra and Mahindra posted a 3.4 per cent decline in standalone net profit for the first quarter ended June 30, 2015, at Rs 852 crore compared with Rs 882 crore in the same quarter of the previous fiscal.

Gross revenues and other income for the company during the quarter also de-grew marginally by 2.15 per cent to Rs 10,629 crore as against Rs 10,863 crore in the corresponding quarter of the previous year.

“The tractor industry witnessed a sharp de-growth in Q4 of 2015 owing to the stress in the agri economy caused primarily by crop damage due to unseasonal rains. Going into Q1 of 2016, uncertainty loomed over the prospect of a good kharif crop with the IMD forecasting a less than normal monsoon. This, along with only a marginal increase in minimum support prices, resulted in subdued rural sentiments, leading to another quarter of de-growth in the tractor industry. However, some positivity is seen in the later part of June 2015 with the monsoon setting in on time,” M&M said.

In the current quarter, the passenger vehicle market grew eight per cent driven by growth in the car segment. The UV segment continued to be under pressure and de-grew by 0.6 per cent.

In the commercial vehicle industry, the LCV segment continues to be in the negative but the MHCV goods segment continued to grow on back of improvement in industrial activity, movement in infrastructure projects and some replacement demand, the company added. As far as future outlook is concerned, the company remained optimistic.

“The company’s balance sheet remains healthy and well buffered, and it looks to the future with optimism, while remaining alert to the near term risks outlined above,” M&M said.

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