M&M's Q3 PAT up by 252 pc at Rs 704 cr

Mumbai (Maharashtra) [India], February 5 : Mahindra & Mahindra Ltd on Friday reported a consolidated profit after tax of Rs 704 crore in Q3 FY21, marking a year-on-year jump of 252 per cent.
In Q3 FY20, it had posted a net profit of Rs 200 crore. The revenue and other income moved up to Rs 21,868 crore from Rs 19,706 crore in the same period.
M&M said the key drivers were capital allocation actions, a 220 basis increase in standalone operating margins on the back of 20 per cent growth in tractor volumes and 12 per cent revenue increase in auto business.
Capital allocation actions were targeted at loss-making subsidiaries, said the company.
"These actions have made a significant contribution to the financial performance. They include turnaround of businesses, restructuring to achieve profitability and exit from multiple businesses."
The increase in operating margins was driven by cost optimisation and operating leverage. Tractor volumes grew by 19.6 per cent on the back of a robust rural story. M&M expects strong demand to continue.
The demand for auto continues to be strong, it said. The utility vehicle business grew 11 per cent though production was lower than demand due to electronic control unit (ECU) and steel shortage.
"While the overall customer cashflows have shown improvement, it is yet to return to pre-Covid levels," said M&M.
The 19.4 billion dollar Mahindra Group has presence in agribusiness, aerospace, commercial vehicles, components, defence, logistics, real estate, renewable energy, speedboats and steel among other businesses. It employs over 2.56 lakh people across 100 countries.