Mahindra & Mahindra Q4 profit rises marginally to Rs 897 cr
May 30 2014 , Mumbai
The company had posted a net profit of Rs 889.19 crore during the same period of 2012-13. Revenue of the company on a standalone basis rose by 3.5 per cent from a year ago to Rs 10,837.89 crore.
Pawan Goenka, president of the automotive farm equipment and two wheeler sectors of the group, said, the auto industry is passing through challenging times and demand continued to remain under stress in the quarter.
However, going forward the scenario is expected to improve as with the formation of a stable government and focus on infrastructure would help the country’s economy to revive. The customer sentiment is also changing.
For the year ended March 31, the company’s net profit grew by 12.01 per cent from a year ago to Rs 3,758.35 crore. Net sales rose marginally to Rs 39,963.36 crore in 2013-14.
In the quarter the company has the scheme of arrangement for the merger of the trucks business of M&M’s subsidiary, Mahindra Trucks and Busses (MTBL) with M&M, was approved by the Bombay High Court on March 7, 2014. It has been given effect to from April 1, 2013. In view of this the financials of the trucks business of MTBL became a part of the current year financials of the company. Also due to the merger, the past unabsorbed tax losses related to the trucks business of MTBL became available to the company and there was a one time tax saving during the current year. After giving effect to the merger, the net profit after exceptional items and tax for the quarter is Rs 967.7 crore, as against Rs 962.9 crore a year ago. Excluding the trucks business of MTBL, net profit after tax for the quarter is Rs 975.6 crore and the operating margin is 14.0 per cent.
On a consolidated basis, the country’s largest utility vehicle manufacturer’s net profit rose 13.8 per cent fro a year ago to Rs 4,666.93 crore.
Gross revenues and other income of the company grew 5.9 per cent from a year ago to Rs 78,735.77 crore
Going forward the company expects the economy will witness turnaround in growth in 2014-15. “Despite EL Nino risks clouding the outlook for agriculture, we expect to witness a nascent, infrastructure and manufacturing-led economic recovery in 2014-15,” said Goenka.
Analysts feel that the sector is likely to witness demand growth going forward.
Mitul Shah an analyst at Karvy StockBroking said that it is difficult to comment on the performance of the company in the fourth quarter as for the first time the Trucks and Buses business has been merged. However, auto sector demand is expected to revive from the second half and the company is expected to perform well.