Mumbai: Mahindra and Mahindra will launch more products in the October-March period of this fiscal to fight volatility in the sector, its chairman Anand Mahindra said on Friday.
“We are confident that with the products we have in the pipeline, our power to spring back resiliently remains intact and you will see it being unleashed in the second half of this year,” he told shareholders at the annual general meeting of the company here.
Dwelling strongly on the importance of resilience, Mahindra compared the flagship company of the group with the bamboo, saying it has shown the same characteristics in the face of difficulties witnessed through the year.
He said the auto sales slipped by 10 per cent in the final quarter of the fiscal and sales in the high-margin tractor segment plummeted by 30 per cent, which was last seen in the third quarter of 2009, when the company posted a profit of only Rs 1 crore.
“This time around, in spite of double the volume drop for tractors – in fact, the largest volume drop in a decade, we still generated a profit after tax for the quarter of Rs 617 crore after adjusting exceptional and one-time items and an operating profit margin of 11.8 per cent,” he said.
This was possible on the back of right measures to protect revenue and profit, he said.
Mahindra said in 2014-15, half of the top 10 original equipment manufacturers in the auto industry in the country have registered a decline due to weak demand across the globe.
Additionally, in the tractor industry where the group has a sizable presence, all the states in the country except one, had drop in growth.
The company today reported a 3.35 per cent slide in standalone net profit at Rs 852.2 crore for the three months through June, hurt by slowdown in overall sales and warned that tractor sales will continue to be under strain in the second quarter as well.
“I don’t see the farm equipment business picking up in the September quarter as well. Our tractor sales degrew 12 per cent in July and I expect sales degrowth to continue in the remaining months of quarter 2.
But with a better-than-expected monsoons, I see some pick up from October and hopes to close the year with around 6 per cent growth,” executive director and head of automotive business Pawan Goenka said.
The company scrip shed 0.47 per cent to close at Rs 1,387.65 apiece on the BSE, as against the 0.22 per cent correction in the benchmark.
Shareholders at the AGM also paid homage to former President A P J Abdul Kalam by observing silence.