Mahindra net profit rises marginally

BS 200 SCORECARD

Mahindra and Mahindra (M&M) reported a nominal 3.52 per cent growth in net profit at Rs 241.68 crore for the third quarter ended December 2006 compared with Rs 233.45 crore in the corresponding period of the previous year.

Income from operations grew by 16.47 per cent to Rs 2,617.30 crore during the quarter as against Rs 2,247.45 crore in the year-ago period.

The last year's December quarter net profit figure includes Rs 41.75 crore, which the company fetched for its LCV business that it had sold, and an octroi refund of Rs 13.61 crore. 
 

Rs crore	Quarter ended Dec
	2005	2006
Net sales	2207.17	2576.06
Other income	40.29	41.24
Total income	2247.46	2617.30
Expenditure	1923.08	2266.43
Operating profit	324.38	350.87
Net profit	233.46	241.69
EPS (Rs)	10.43	10.21

The M&M scrip closed today at Rs 900.20 on the Bombay Stock Exchange (BSE) as against previous day's close of Rs 925.70, registering a 2.75 per cent fall.

"Net profit for the quarter under review was actually up by 35.13 per cent if we exclude these exceptional items form the figure for the corresponding quarter of the last year. There was no exceptional profits during the reporting quarter," said Uday Y Phadke, president - finance, M&M.

Of the total income from operations, other income, including dividend received from subsidiaries, stood at Rs 41.24 crore for the quarter. Other income for the quarter ended December 31, 2005 was Rs 40.28 crore.

Pawan Goenka, president - automotive sector, Mahindra and Mahindra, said, "The company witnessed a growth of 16 per cent in the overall sales volumes, with nine per cent growth in the utility vehicle segment.

The light commercial vehicle segment grew by 41 per cent, thereby grabbing a market share of 20 per cent. Owing to high material costs and a slow down in exports to the Southeast Asian countries such as Malaysia due to a change in the duty structure, the Profit growth has been marginal."

Due to the stringent cost saving measures adopted by the management, the farm equipment segment grew by 15 per cent with a total sales of 85,537 units, including 15 per cent growth in exports. Revenues for the segment grew by 27 per cent with a profit growth of 54 per cent.

There was an exceptional profit of Rs 196.9 crore during the quarter that accrued to the group from the sale of 9 per cent of stake in the Mahindra Gesco Developers through qualified institutional placement (QIP) of shares.

However, this exceptional profit item was not included in the stand-alone quarter results of M&M.