M&M Reports 23% Profit Increase Driven by SUV Sales and Tractor Demand

India’s Mahindra & Mahindra (M&M) reported a 23% increase in adjusted profit for the first quarter, driven by higher sales of its sport utility vehicles (SUVs) and a resurgence in tractor demand.

The company’s standalone net profit rose to 26.13 billion rupees ($312 million) from 21.2 billion rupees in the same period last year, which had been augmented by a gain from selling stakes in two units. Without this previous year’s gain, M&M’s profit showed a 5.3% decline year-over-year in the latest quarter.

Despite initial market reactions causing M&M’s shares to fall by as much as 1.7%, they later recovered and traded up by 1% in the afternoon session. The company, renowned for its ‘Scorpio’ SUV, saw its total revenue increase by 12% to 270.39 billion rupees.

M&M’s car sales, predominantly SUVs, surged by an industry-leading 24%, while tractor sales increased by 5.6% in the fiscal first quarter, contrasting with a 7% decline in fiscal 2024.

The company’s auto sales, which include both personal and commercial vehicles, grew by 13.1% to 189.47 billion rupees, making up two-thirds of M&M’s total revenue. Sales in the higher-margin farm equipment sector also rose by 9.2%. However, the company’s expenses rose by 10%, mainly due to increased costs of raw materials such as aluminum, copper, and rubber.

As M&M reported these results, Maruti Suzuki India, its main competitor and the country’s leading carmaker by sales, was expected to release its results later in the day. The financial performance and market movements of both companies are closely watched, as they play significant roles in India’s automotive industry. The exchange rate at the time was $1 equal to 83.73 Indian rupees.