Tractor volumes, inventory management help M&M post 9 percent growth

A 20 percent growth in tractors in Q3 of 2013-14 coupled with tight inventory management among other things helped Mahindra & Mahindra (M&M) post a 9 percent post-tax profit of Rs 1,000.1 crore as against Rs 915 crore in Q3 of the last year.

The company was helped by volume growth, manageable input costs and the movement of production to areas that attract lower tax rates, top sources said.

For the period under review, the company sold 54,164 utility vehicles as against 68,000 units in the previous Q3. The Verito and Vibe together sold 1,967 units as compared to 3,814 units in the year-earlier quarter.

On the tractors front, the company sold 181,566 units in Q3 of 2013-14 compared to 150,562 units in the year-earlier quarter, a growth of 20 percent. At present, the company’s Zaheerabad facility is rolling out 100 tractors a day.

On the export front, the company said it has increased its market share (Mahindra USA) in the US by 1.7 percent. However, exports of tractors fell as MUSA has taken on fewer billings ahead of Tier 4 emission regulations in the US. Closer home, the Sri Lankan market for tractors has fallen thanks to higher import duties.