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Informist, Monday, May. 5, 2025

MUMBAI – Mahindra & Mahindra Ltd. said while urban India has been under stress for a while, the macroeconomic fundamentals are in place and will turn around very quickly in the coming months. Terming it more of a blip, M&M said the company has not felt the impact of falling urban demand due to its unique product offerings. The management made these statements at a post-earnings press conference. 

M&M reported its March quarter earning earlier on Monday. M&M reported a net profit of INR 24.4 billion on revenue of INR 316.1 billion. Sales of automobile units by the Thar maker in 2024-25 (Apr-Mar) increased 14% on year to 941,115 units.

While the rural market continues to be strong, the turnaround in the urban markets will be spurred by fiscal policies like the income tax break announced in the Union Budget earlier this year. 

Weak demand growth was one of the weaker points for the automobile industry in the previous financial year, which led to inventory build-up. For M&M, inventory of its passenger vehicle business is now under control at under 30 days, the company said. Inventory level at automobile dealerships last year had surged to 80 days, a record high which prompted heavy discounts to lighten inventory load.

M&M retained the top spot in the sport utility vehicle segment in terms of market share and revenue market share in the March quarter. The company sold 550,000 passenger vehicles in the latest quarter. The latest addition to its passenger vehicle line-up happens to be the two new pure-electric utility vehicles--the BE 6 and XEV 9e. As of last week, the company had 30,000 bookings for its new electric vehicles, and delivered 6,300 units. Currently, there is a waiting period of roughly 4-5 months for them, M&M said.

"Overall demand momentum is strong, feedback from existing customers is really strong. There is a very positive skew to the top-end variants and which is what continues from the initial period," the management said. While the company has no plan of entering North American markets through its electric car business, it might explore doing so in the European Union at some point. "But that will be in a calibrated way. Like we said, we will do right-hand drive EVs first, and then do left-hand drive. So we are a while away," M&M said. Demand for M&M cars increased overseas, the company said. "We have seen very good gains in market share in South Africa. In Australia in particular, (M&M got) strong scores on brand affinity," the company said.

The electric automotive operations of the company are done through its subsidiary Mahindra Electric Automobile Ltd. The electric vehicle business of the Scorpio maker turned earnings before interest, taxes, depreciation, and amortisation-positive in the March quarter, even without production-linked incentive scheme benefits. However, turning EBITDA margin positive would take some time because of the investments needed, the company said. The company has set a target to have a line-up of 9 petrol and diesel-run cars, seven electric sport utility vehicles, and seven light commercial vehicles.

M&M gained a market share of 4.8 points in the light commercial vehicles segment. In FY25, while the light commercial vehicle industry contracted 3%, M&M registered a growth of 4% in terms of sales, the company said. This was driven by product launches and channel expansion, especially in southern India. "...that helped us gain a strong market, a huge market share in the south. This was an area we were not as strong in," the company said. While the commercial vehicles segment as a whole had a subdued year, M&M hopes the light commercial vehicles segment to register a turnaround in FY26.

In its farm equipment sector business, M&M increased its market share by 1.8 points--the highest such gain ever, the company said. "The one area we have not done as well as would have liked to, is the international market and exports (for the farm equipment sector). This is because around the world we have seen a significant slow down," the company said. M&M's tractor inventories are currently in line with their norms.

The company expects the domestic tractor industry to grow in high single digits in the ongoing financial year, based on the positive indicators they see right now. While electric tractors are ready with M&M on the product development level, it does not plan on converting it into a ready-to-launch product. "We've timed that to when we think the market is more ready for it, so we're not excluding the final stages of readiness there," the management said. 

Monday, shares of the company closed 3.3% higher on the National Stock Exchange at INR 3,021.50.  End

Reported by Anand JC and Gopika Balasubramanium

Edited by Akul Nishant Akhoury

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