NEW DELHI: Exceptional and one-off items resulted in 77 per cent drop in Mahindra - Mahindras December quarter profit.
Excluding exceptional items, the profit for the automaker would have fallen only by 34 per cent.
Here are key takeaways from the auto makers Q3 results:Exceptional items hurt bottom lineThe profit figure was hit by provisions made for impairment of certain investments worth Rs 601 crore.
The company also reported a one-time gain of 47 crore.
In total, exceptional and one-off items amounted to Rs 554 crore for the quarter compared with net gain of Rs 519 crore in the same quarter last year.
Excluding both exceptional and one-off items, the profit would have risen 7 per cent to Rs 934 crore.
Signs of trend reversal visibleThe company said that auto and tractor segments have shown some signs of trend reversal, seeing moderation in the double-digit degrowth.Good monsoons, the festive season demand, improved liquidity conditions, new launches, especially in the utility vehicle (UV) segment and special schemes offered by OEMs for the auto industry were the key reasons for this moderation in degrowth, it said.Margin expands 160 basis points to 14.8%Operating profit margin for the quarter rose 160 basis points to 14.8 per cent from 13.2 per cent YoY.
Kotak Institutional Equities had expected a margin expansion of only by 80 basis points YoY, as it expected a likely 250 basis points expansion in margins will be partly offset by negative operating leverage.
Axis Capital had expected margin improvement for M-M at 30 bps YoY on hopes of reduction efforts and check on discount levels.Update on commercial vehicle, tractor segmentsThe company noted that commercial vehicles (CV) industry continues to be in pain, clocking a 17.3 per cent fall in sales.
The heavy commercial vehicle (HCV) goods industry also saw 56.4 per cent fall in volumes for December quarter.The volumes for the HGV segment have fallen to 2014 levels of 20,000-22,000 trucks per quarter.
In Q3, both the company's domestic tractor sales and the domestic tractor industry registered a 6 per cent YoY, it noted.Revenue up 6%, profit drops 73%Revenue for the quarter fell 6 per cent to Rs 12,120 crore compared with Rs 12,893 crore in the same quarter last year.
Net profit plunged 73 per cent year-on-year (YoY) to Rs 380 crore in December quarter.
The figure included numbers for wholly-owned manufacturing unit MVML.