M&M could post flat profit for Q4 at Rs 658 cr; volume growth seen rising 2.5%

Automobile major Mahindra and Mahindra is likely to post a flat profit for March quarter at Rs 658 crore against Rs 652.9 crore posted during the same period last year.

The company’s revenue could be up 2.3 percent at Rs 10,400 crore against Rs 10,160 crore during March 2016.

Meanwhile, the earnings before interest, taxes, depreciation and amortisation (EBITDA) is likely to be down 3 percent at Rs 1,229 crore against Rs 1,269.4 crore YoY. The operating margin came in at 11.8 percent against 12.5 percent last year.

What to watch out for?

Overall volume growth subdued, up 2.5% YoY at 1.88 lakh vs 1.83 lakh units

New product platforms, network improvements and increased collaboration between two brands Mahindra and Swaraj aided tractor volumes

Auto volumes down 1.7% YoY at 1.38 lakh vs 1.40 lakh units

SUV market share has weakened over past one year to 30%

Lower than expected ramp up of smaller SUVs impacted sales

Higher share of tractors to result in higher margins YoY

However this will be offset by higher raw material prices

One time impact of 52cr due to higher discounts on account of BS 3 inventory liquidation