Mahindra and Mahindra Ltd , India's biggest SUV manufacturer, beat analysts' estimates with a 22 percent rise in net second quarter profit as its car sales outperformed the market, but margins were hit by a fall in tractor sales.
Mahindra, the world's biggest tractor maker by volume, said its domestic tractor sales fell 13.8 percent in the June-September quarter, hit by cooling economic growth and lacklustre monsoon rains, dragging the company's operating margin down to 11.4 percent from 12 percent a year ago. "Tight macroeconomic and political constraints at home and worries about a second global recession have taken a heavy toll on the Indian economy," the company said in a statement. "The current economic situation is quite challenging." Mahindra said on Thursday net profit for the September quarter was 9.02 billion rupees ($168 million), against 7.37 billion rupees a year earlier. Net sales rose 33 percent to 96.59 billion rupees.
Analysts, on average, had expected profit of 8.40 billion rupees on revenue of 95.72 billion rupees, according to Thomson Reuters I/B/E/S. Mahindra, which controls South Korean car maker Ssangyong Motor Co Ltd, said revenue from automotive sales jumped 58 percent in the quarter, as surging demand for SUVs helped the company defy the gloom in India's car market.