India's Mahindra & Mahindra posts bigger adjusted profit on strong car, tractor sales

BENGALURU (Reuters) - India's Mahindra & Mahindra (M&M), on Wednesday, reported a 23% jump in adjusted profit for the first quarter, helped by an increase in sales of its sport utility vehicles (SUVs) and a rebound in demand for tractors.

The company's standalone net profit rose to 26.13 billion rupees ($312 million) in the quarter, from the 21.2 billion rupees year-ago profit that was boosted by a gain on the sale of its stake in two units.

Including that year-ago gain, M&M's profit fell 5.3% year-over-year in the latest quarter.

M&M's shares fell as much as 1.7% immediately after the results, before reversing course to trade up 1% in the afternoon session.

The company, which makes the 'Scorpio' SUV, said total revenue grew 12% to 270.39 billion rupees.

M&M's car sales, almost entirely SUVs, jumped an industry-leading 24%, according to industry data, while tractor sales increased 5.6% in the fiscal first quarter. Tractor sales had fallen 7% in fiscal 2024.

Overall, auto sales, including personal and commercial vehicles, grew 13.1%, to 189.47 billion rupees in the quarter, accounting for two-thirds of total revenue, the company reported.

Sales in the higher-margin farm equipment business rose 9.2%, M&M said.

Expenses rose by a tenth, mainly due to higher costs of raw materials such as aluminium, copper and rubber.

Maruti Suzuki India, M&M's rival and the country's top carmaker by sales, will report results later in the day. ($1 = 83.7300 Indian rupees) (This story has been corrected to say that including gain, profit fell, not excluding, in paragraph 3)

(Reporting by Meenakshi Maidas and Nandan Mandayam in Bengaluru; Editing by Sherry Jacob-Phillips and Savio D'Souza)