Strong auto business likely to offset tractor slowdown for M&M stock

The auto business is expected to be the growth driver for the next two years due to a healthy order backlog and new launches

The December quarter (Q3FY24) results of Mahindra & Mahindra (M&M) were better than expected. The revenue was up 17 per cent year-on-year (Y-o-Y) to Rs 25,300 crore and in line with consensus estimates. The operating profit margin at 12.8 per cent was ahead while operating profit grew 15 per cent Y-o-Y. The consolidated adjusted net profit at Rs 2,660 crore was also up 34 per cent Y-o-Y.

The farm equipment segment (FES) margin was lower at 15.5 per cent, which was offset by better auto margin at 8.3 per cent. The net profit beat estimates driven by lower tax outgo