Mahindra & Mahindra (M&M) rose 1.94% to Rs 844.60 after the company reported a net profit of Rs 162.54 crore in Q4 FY21 as against a net loss of Rs 3255.02 crore in Q4 FY20.
Net revenue from operations increased by 48.1% year-on-year (YoY) to Rs 13,338.15 crore during the quarter. The results include the combined earnings of M&M and Mahindra Vehicle Manufacturers (MVML), which is a manufacturing unit of M&M.
The auto maker recorded a pre-tax profit of Rs 551.38 crore in the fourth quarter. It has posted a pre-tax loss of Rs 2,687.72 crore in the same period last year.
Exceptional loss (net) of Rs 839.89 crore in Q4 March 2021 represents impairment provisions for certain long-term assets and other exposures.
While M&M's total vehicles sales increased by 18% to 1,06,333 units, the company's total tractor sales jumped 58% to 93,044 units in Q4 FY21 over Q4 FY20.
Farm Equipment Sector revenue increased 60% YoY to Rs 4,975.5 crore in Q4FY21, with highest ever fourth quarter domestic volumes.
Auto sector revenue was up 43% YoY to Rs 7,858.14 crore in Q4FY21, with a strong booking pipeline for its key products; however, supply constraints limit production and sales.
Operating margin in Q4 FY21 improved to 14.7% compared to 13.6% in the corresponding quarter previous year despite a significant strengthening in commodity prices.
The automaker said that overall demand remained robust for the company's products in Q4FY21. However, the global shortage of semi-conductors impacted the production & sales for the quarter.
The Automotive sector continued its focus on cost optimization and reduced its fixed expenses by over Rs 900 crores over the last two years & hence keeping its margin resilience even under challenging times.
M&M reported 24.8% jump in net profit to Rs 922.94 crore while net revenue from operations remained almost flat at Rs 44,574.44 crore in FY21 over FY20.
Operating cash generated for FY21 increased by 119% at Rs 10,022 crore, driven by improved profitability and robust working capital management.
Rajesh Jejurikar, executive director, M&M, said, "Our approach of Walk-Run-Fly has delivered strong financial returns in FY21. The strong margins and turnaround of global subsidiaries in Farm Equipment Sector along with a robust automotive demand momentum through the focused SUV strategy has set the ground for us to now accelerate to fly. New products and technologies, farm machinery opportunity, Krishe and cost management sets us up for a bold, aggressive growth trajectory."
M&M's business is diversified across farm equipment, auto and automotive components, real estate, hospitality, information technology, defence and aerospace and financial services.
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