M&M gains after reporting good auto & tractor sales for May

Mahindra & Mahindra gained 0.55% to Rs 1,332.05 at 14:40 IST on BSE after the company announced good auto and tractor sales for May 2016.

The sales figures were announced during market hours today, 1 June 2016.

Meanwhile, the S&P BSE Sensex was up 128.94 points or 0.40% at 26,731.95

On BSE, so far 84,811 shares were traded in the counter as against average daily volume of 93,032 shares in the past one quarter. The stock had hit a high of Rs 1,349.70 and low of Rs 1,326 so far during the day. The stock had hit a record high of Rs 1,441.45 on 7 August 2015. The stock had hit a 52-week low of Rs 1,092 on 12 February 2016. The stock had underperformed the market over the past one month till 31 May 2016, falling 0.53% compared with 4.14% rise in the Sensex. The scrip had also underperformed the market in past one quarter, gaining 7.98% as against Sensex's 15.94% rise.

Mahindra & Mahindra (M&M) said that total auto sales rose 11% to 40,656 units in May 2016 over May 2015. Domestic sales rose 10% to 36,613 units in May 2016 over May 2015. Exports sales rose 21% to 4,043 units in May 2016 over May 2015.

Commenting on the auto sales performance for May 2016, Pravin Shah, President and Chief Executive Officer (Automotive) M&M said that the favurable monsoon projections will definitely lead to improved buyer sentiment that would likely bring a buoyancy in overall demand across all segments of the automotive industry. Going forward, the company expects that the wider product portfolio will drive growth.

Separately, M&M said that total sales of tractors rose 20% to 23,018 units in May 2016 over May 2015. Domestic sales of tractors rose 21% to 22,148 units in May 2016 over May 2015. Exports sales of tractors fell 14% to 870 units in May 2016 over May 2015.

Commenting on the tractor sales performance, Rajesh Jejurikar, President and Chief Executive Farm Equipment and Two Wheeler Division, M&M said that the company hopes that the positive monsoon forecast, advance estimate of Rabi crop production and the increase in minimum support prices will boost agri income and positively impact the demand going forward.

M&M's net profit rose 6% to Rs 583.73 crore on 14.8% growth in net sales to Rs 10666.43 crore in Q4 March 2016 over Q4 March 2015.

Mahindra Group enjoys a leadership position in tractors, utility vehicles, information technology, financial services and vacation ownership. In addition, Mahindra enjoys a strong presence in the agribusiness, aerospace, components, consulting services, defence, energy, industrial equipment, logistics, real estate, retail, steel, commercial vehicles and two-wheeler industries.

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