Mahindra surpasses Q4 profit forecast with strong SUV demand

BENGALURU (Reuters) - Indian automaker Mahindra & Mahindra reported better-than-expected fourth-quarter profit on Thursday, helped by continuing strong sales of its sports utility vehicles (SUVs).

The company said standalone profit after tax rose 31.6 per cent to 20.38 billion rupees ($244.06 million), beating analysts' estimates of 19.61 billion rupees as per LSEG data.

Utility vehicles (UV) accounted for more than half of passenger vehicle sales in India, rising 31 per cent year-on-year, according to an industry body. Mahindra sold 27.2 per cent more SUVs - which comes under the UV category - in the quarter from a year earlier.

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The company's automotive business brings in almost two-thirds of total revenue and includes the sale of commercial vehicles and SUVs such as Scorpio and Thar. Open bookings for SUVs were at 220,000 as of May 1, 2024.

However, earnings for India's largest tractor-maker by sales were pressured by a 21.5 per cent fall in tractor and farm equipment sales, as sub-par rains affected rural demand.

Revenue from the automotive segment revenue rose 20 per cent, while that of the farm equipment segment fell 13.1 per cent, Mahindra said. The company said revenue from operations rose 11.2 per cent to 251.09 billion rupees, beating analysts' average estimate of 240.25 billion rupees.

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