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• Auto Revenue Market Share: 21.9%, up almost 2 percentage points year-over-year.

• PBIT Margin (Auto): Increased by 140 basis points compared to the same quarter last year.

• Farm Market Share: Increased by almost 1 percentage point, with margins up 150 basis points year-over-year.

• Services Profit After Tax Growth: 80% growth, driven by TechM and Mahindra Finance.

• Mahindra Finance Asset Quality: Asset quality improved with GS3 at 3.8%.

• Consolidated PAT: Increased by 35% to INR 3,171 crores.

• Revenue: Approximately INR 38,000 crores, up 10% year-over-year.

• Auto and Farm Revenue Growth: Up 23% year-over-year.

• Tech Mahindra EBIT: Increased by almost 5 percentage points.

• Mahindra Finance PAT: Up 36% year-over-year.

• Asset Under Management (Mahindra Finance): Up 20%.

• Farm Consolidated Growth: 6% growth, impacted by international subsidiaries.

• Tractor Market Share: Year-to-date October market share at 43.9%.

• Farm Margins: Tractor margin at 18.7% in a low-volume quarter.

• Auto Consolidated PBIT Growth: 26% growth with a 15% revenue increase.

• Auto Margin: Strong at 9.5%.

• ROE: Maintained at 18.9% for the quarter.

• Warning! GuruFocus has detected 4 Warning Signs with MAHMF.

Release Date: November 07, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Mahindra & Mahindra Ltd (MAHMF) reported a strong operating performance in both the Auto and Farm sectors, with Auto revenue market share increasing to 21.9%, up nearly 2 percentage points from the previous year.

• The company achieved significant margin improvements, with PBIT margins in the Auto sector up by 140 basis points and Farm sector margins up by 150 basis points compared to the same quarter last year.

• Mahindra Finance showed a positive turnaround with asset quality improving, as gross stage 3 (GS3) assets were reduced to 3.8%, and profit after tax increased by 36%.

• The renewables business, Susten, is progressing faster than planned, securing almost 1 gigawatt in the last quarter alone, indicating strong growth potential.

• The company maintained a robust consolidated profit after tax growth of 35% year-over-year, with a return on equity (ROE) of 18.9% for the quarter, surpassing their target of 18%.

Negative Points

• Mahindra & Mahindra Ltd (MAHMF) faced challenges in its international Farm business, particularly in North America, where the market has significantly shrunk, and in Turkey, where hyperinflation affected accounting numbers.

• The company experienced a 1% decline in disbursements in Mahindra Finance, although this was not a major concern as the focus was on building a stable business model.

• There were some pressures on logistics profitability due to the integration of Rivigo, despite revenue growth in the segment.

• The company anticipates temporary pressure on margins in the Auto sector due to launch expenses, particularly in Q3.

• Mahindra & Mahindra Ltd (MAHMF) is facing capacity constraints in some ICE models, necessitating a review of their manufacturing footprint to address the demand.