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Mahindra & Mahindra Rises Prior to Q2 Earnings Announcement; What to Expect? – India

By Malvika Gurung — The Indian automaker Mahindra & Mahindra (NS:) was seen trading 1.33% higher for Rs 870.95 at 12:30 am on Tuesday. The stock jumped almost 3% to mark an intraday high of Rs 884.50 in early trade hours in today’s session, before releasing its quarterly earnings report for the September-ended quarter.

Analysts peg the auto company’s net profit to fall, due to shortages in the supply of semiconductor chips and a steep hike in commodity prices.

However, revenues are estimated to rise in the range of 7-8%, led by higher volumes and realisations, and an increase in automotive sales.

Homegrown broker Emkay Global expects the company’s PAT to grow 13.7% to Rs 1,490.60 crore on a YoY basis, backed by a 123% surge in dividend income to Rs 860 crore, from Tech Mahindra (NS:) and M&M Financial services, while the revenue is expected to rise by 7.5% YoY to Rs 12,464 crore for the September quarter. 

The EBITDA and the margin are expected to decline 20.4% and 13.1% YoY respectively, on rising raw material prices, an inferior product mix, or lower share of tractor sales, and delays in the pass-through of commodity inflation, states the brokerage.

Yes Securities estimates the PAT to decline by 28% YoY to Rs 942 crore, while the company’s revenue is expected to rise 7.7% on an annual basis, and 7.1% sequentially.

Another brokerage Motilal Oswal (NS:) states that a good demand picture of SUVs and pickups for the September quarter while being restricted by the supply constraint, could pull the revenue growth to 6% at Rs 12,209 crore,