The automobile major reported a net profit of Rs 1,778.75 crore for the September quarter. This implies a jump of 26 percent from the profit of Rs 1,410.86 crore posted during the same quarter of last year.
Shares of Mahindra & Mahindra are down around 2 percent as investors reacted to the September quarter results.
Brokerages have remained subdued on the automobile major’s performance, while some have cut their targets.
The automobile major reported a net profit of Rs 1,778.75 crore for the September quarter. This implies a jump of 26 percent from the profit of Rs 1,410.86 crore posted during the same quarter of last year.
The results include combined financials for Mahindra & Mahindra as well as Mahindra Vehicle Manufacturers (MVML).
The total revenue increased to Rs 12,790. 17 crore during the quarter against Rs 12,019.37 crore posted during Q2 of FY18. The revenue grew 6 percent year on year.
At an operating level, the earnings before interest, taxes, depreciation and amortization (EBITDA) fell to Rs 1,849 crore from Rs 1,923 crore posted last year.
The operating margin was reported at 14.4 percent, down from 16 percent last year.
Brokerage: Credit Suisse | Rating: Outperform | Target: Cut to Rs 1,030
The global research firm said that the company had a slightly weaker margin in autos compensated by tractors. Further, the company maintained 12-14 percent tractor growth guidance for FY19. It also cut its estimates by 1 percent and multiple by 10 percent.
Brokerage: Nomura | Rating: Buy | Target: Cut to Rs 982 from Rs 1,071
Nomura said that Q2 was in line, while rural outlook remains positive. Further, new launches will drive further growth.
Brokerage: Morgan Stanley | Rating: Overweight | Target: Rs 1,063
The global research firm said that new launch costs hit margin. It expects 2019 to be solid on the back of a low base.
Brokerage: Deutsche Bank | Rating: Buy | Target: Cut to Rs 945 from Rs 990
Deutsche Bank said that the management has moderated outlook for SUVs and is a positive.
It has cut SUV forecast by 6-7 percent to factor the moderation.
Brokerage: Citi | Rating: Buy | Target: Rs 1,050
Citi said that weaker auto revenue was offset by stronger than expected tractor revenue. The management sees tractor volume to grow around 12 percent year on year against 14 percent earlier. Change in axle load norms is resulting in down-shifting of mix.
