Mahindra & Mahindra (M&M) on Friday said it had major plans for the automotive segment and will launch new products, refreshed products and variants including petrol versions every quarter.
Mahindra & Mahindra (M&M) on Friday said it had major plans for the automotive segment and will launch new products, refreshed products and variants including petrol versions every quarter.
Speaking to media shortly after announcing its quarterly results, Pawan Goenka, executive director and president at M&M said the company would launch two new vehicles in the utility segment and one in the commercial vehicle segment.
The company's Q3 FY15 performance was in line with street expectations. Net profit grew by 5.7% to Rs 967 crore. M& M's net sales stood at Rs 9, 260 crores while the operating profit was down 24.8% YoY at Rs 1080 crore. The operating margin at 11.7% was down from 14% in the previous corresponding quarter of FY 14.
Goenka said the increase in cost of client acquisition was one of the main reasons for the drop in operating profit margin.
It's tractor business degrew 26.1% largely due to the sluggishness in the tractor segment that has de-grown by 21.8%.
"The company never had a petrol variant in the automotive segment, with its new plans to venture into this space, the company will be in a position to garner a larger market share," said Bharat Gianani, auto analyst at Angel Broking.
M&M has pruned its plant and dealer inventory in auto and farm equipment segment (AFS) which has also contributed to the subdued performance in the tractor segment.
The major reason for the tractor segment performing below the market performance has been the low retail demand with inventory reduction taking the second place said Ginani.
Meanwhile, the company has plans to set up new plants in Africa and make new in roads to Turkey.
The companies performance in the US has been one of the key highlights of the quarter with growth of more than 100% in exports to that country.
The company said that they have received 8000 orders in the first four weeks for Tivoli, in South Korea, which is the first launch post M&M's acquisition of the Korean automaker, SsangYong.
The management believes the auto sector to turnaround faster than the tractor segment following an anticipated spurt in the economic growth.
Goenka, expects the government to announce reduction in excise duty for the auto sector, lay down a road map for GST and increase infrastructure spending. "The government should also incentivise R&D so that we need not depend on other countries for product development," he added.
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
)
){kind=small}
){kind=small}
)
)
)
)
)
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}