Mahindra & Mahindra Shares Q3 Results

Mahindra & Mahindra Shares Q3 Results

by 5paisa Research Team Last Updated: Aug 08, 2022 - 06:46 pm 37.3k Views
Listen icon

It was a strong quarter for M&M at a consolidated levels. Despite pressures on the core auto and agricultural machinery business, the surprising outperformer in the quarter was the financial services arm. There was clear traction at an operating level, although the sharp rise in net profits was more due to exceptional items. Overall, it was a healthy quarter for the M&M group, largely supported by the financial services business.

Here is a gist.

Rs in Crore

Dec-21

Dec-20

YOY

Sep-21

QOQ

Total Income (Rs cr)

₹ 23,594.46

₹ 21,625.95

9.10%

₹ 21,469.80

9.90%

Operating Profit (Rs cr)

₹ 2,624.83

₹ 1,557.37

68.54%

₹ 2,978.48

-11.87%

Net Profit (Rs cr)

₹ 1,987.44

₹ 704.39

182.15%

₹ 1,928.64

3.05%

Diluted EPS (Rs)

₹ 17.79

₹ 6.30

 

₹ 17.26

 

Operating Margins

11.12%

7.20%

 

13.87%

 

Net Margins

8.42%

3.26%

 

8.98%

 

 

Let us start off with the top line of the M&M group. For the Dec-21 quarter, Mahindra & Mahindra reported 9.10% growth in revenues at Rs.23,594 crore. During the December 2021 quarter, the automotive business saw strong traction and grew 15.21% YoY at Rs.9,958 crore. This growth in sales was quite unlike other auto players in India, where were under pressure. On a sequential basis, revenues were up by 9.90%, which is strong momentum.

During the Dec-21 quarter, the niche farm equipment business saw sales growth of 2.3% at Rs.6,970 crore despite an erratic monsoon and very dubious growth in rural income levels. Revenues from financial services business were flat with slight negative bias in the quarter. The XUV 700 model saw 100,000 plus bookings in 4 months while auto export volumes increased by 58.3%. Q3 saw tractor market share at a record 39.4% of the Indian market.

Now, let us turn to the operating performance of Mahindra & Mahindra. For the Dec-21 quarter, operating profits were up by an impressive 68.54% at Rs.2,625 crore, largely driven by a turnaround in the asset quality of the financial services business. During the quarter, the operating margins of M&M as a whole stood at above the 11% mark despite the clear risk of commodity inflation and microchips shortages plaguing the sector.

There was solid traction in the operating performance of M&M Financial Services and the real estate business. While financial services gained from asset quality, the realty business gained from a sharp spike in residential and commercial demand in the quarter. Operating margins improved sharply from 7.20% in the Dec-20 quarter to 11.12% in the Dec-21 quarter. However, on a sequential basis, net margins were lower due to higher base.

Let us finally turn to the bottom line. For the Dec-21 quarter the net profits were higher by 182.15% at Rs.2,625 crore on a YoY basis. This is largely on the back of exceptional losses in the Dec-20 quarter, which boosted the spike in profits due to an artificially low base. The company booked losses of over Rs.998 crore in the Dec-20 quarter as a one-time hit towards the discontinued business of SsangYong Motors.

To a large extent, the boost to the net profit was due to the magnified growth effect that made profits look sharply higher. In the absence of this discontinued operations, the growth in PAT would have been approximately equal to the operating profit growth YoY. PAT margins improved from 3.26% in Dec-20 quarter to 8.42% in the Dec-21 quarter. However, the PAT margins were lower by 56 bps on a sequential basis.

Share Market Today


How do you rate this article?

Start Investing in 5 mins*

Rs. 20 Flat Per Order | 0% Brokerage

378X91-D3

About the Author

Our research team is composed of some highly qualified research professionals, their expertise range across sectors.


Enjoy 0%* Brokerage with 5paisa
Resend OTP
Please Enter OTP
Mobile No. belongs to

By proceeding, you agree to the T&C.

Latest News
Trust Fintech IPO Subscribed 108.63 times

Trust Fintech IPO is book-built issue of ₹63.45 crores, consisting entirely of fresh issue shares totalling 62.82 lakh. Trust Fintech IPO commenced its subscription period on March 26, 2024, & concludes today, March 28, 2024.

Aspire & Innovative IPO Subscribed 15.17 times

Aspire & Innovative IPO is a book built issue of Rs 21.97 crores. The issue comprises entirely a fresh issue of 40.68 lakh shares. Aspire & Innovative IPO opens for subscription on March 26, 2024, and closes on March 28, 2024. The allotment for the Aspire & Innovative IPO is expected to be finalized on Monday, April 1, 2024.

Blue Pebble IPO Subscribed 56.32 times

Blue Pebble IPO, valued at ₹18.14 crores, comprises fresh issue of 10.8 lakh shares. Commencing subscription on March 26, 2024, Blue Pebble IPO is set to conclude on March 28, 2024. Allotment process is scheduled to be finalized by Monday, April 1, 2024. Following this, IPO is slated to debut on NSE SME, with tentative listing date of Wednesday, April 3, 2024.