Mahindra Q4 preview: Tractors, commercial vehicles expected to boost profit

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26 Aug, 2025 12:21

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Buoyed by strong growth in tractor and utility vehicle demand, Mahindra & Mahindra (M&M) is expected to post 43 percent growth in stand-alone net profit for the quarter ended March 2018.

As per a Reuters poll of 13 analysts, the Mumbai-based company is expected to post a stand-alone net profit of Rs 1,037 crore for Q4FY18 over Rs 725 crore posted in the same quarter last year. The company will announce its financial results on May 29.

The maker of Scorpio and XUV500 sports utility vehicles, M&M saw a surge of 41 percent in tractor sales during Q4FY18 to 70,635 units, as against 50,253 units clocked during Q4FY17.

Utility vehicle and commercial vehicle sales saw a growth of 19 percent at 1,65,252 units in Q4FY18, as compared to 1,38,414 units sold in Q4FY17.

Stand-alone revenue from operations is expected to grow 9 percent as per the Reuters poll to Rs 13,083 crore in Q4FY18, as against Rs 12,011 crore posted in Q4FY17. M&M took a hit of Rs 171 crore on account of the Supreme Court’s ban on BS-III vehicle sales from April 1, 2017.

The Anand Mahindra-led company is the biggest manufacturer of tractors in the country and enjoys nearly 45 percent of market share. In the utility vehicle segment, the company’s performance came under pressure due to intensifying competition. However, its commercial vehicles division has benefited from the general upward trend in demand.

Maruti Suzuki, the country’s largest car maker, has taken the lead in the UV space despite having just one volume generating product Vitara Brezza. Besides the Scorpio and XUV500, M&M sells models such as KUV100, TUV300, Bolero, Nuvosport, Thar and Xylo.

The company overtook Ashok Leyland in the commercial vehicle (CV) space to secure the second spot in ranking. Most of its CV volumes come from light trucks. Tata Motors remains the leader in the CV segment.

"M&M continues to face strong competition in the UV segment, which seems to have been severely impacted compared to other segments. Tractor volumes were strong, given record crop production. Higher tractor volumes may be an indication of lower than anticipated impact on farm incomes, particularly given the strong sowing for rabi crop. We maintain our Outperformer rating on the stock, given our comfort on the company’s valuations," said a report from IDFC Securities.