M&M's Q4FY16 standalone net profit declines 6% yoy to Rs.583.73 crore : Estimates Mixed

The company’s standalone revenue stood at Rs. 10,666.43 crore, up 13.06% yoy but down 3.11% qoq.

May 30, 2016 2:19 IST | India Infoline News Service
Mahindra & Mahindra (M&M), India's premium SUV manufacturer, reported standalone net profit of Rs.583.73 crore for the quarter ended March 31, 2016, registering growth of 6.02% yoy, but decline of 27.76% qoq. The company’s revenue stood at Rs. 10,666.43 crore, up 13.06% yoy but down 3.11% qoq.

Its standalone core operating profit of Rs. 1,048.95 crore for the quarter, clocked growth of 16.48% yoy but decline of 15.57% qoq. Operating profit margin for the current quarter at 9.83% expanded by 29 bps yoy but contracted by 146 bps qoq.

For the year ended March 31, 2016, the company reported standalone net profit of Rs. 3,167.48 crore, declining by 4.63% yoy. Its standalone revenue for the period stood at Rs. 40,884.98 crore, registering growth of 6.35% yoy.

Mahindra & Mahindra's core operating profit stood at Rs. 4,570.21 crore, recording growth of 9.51% yoy. Operating margin for the current period at 10.9% expanded by 4 bps yoy.

M&M (Q4 FY16) – Below estimates on most counts:
M&M reported a revenue growth of 13% yoy to Rs. 10,801 crore which was higher than IIFL estimates driven by 14.7% yoy growth in automotive segment revenues and 8.2% yoy rise in farm equipment segment revenues. OPM at 9.7% was lower than IIFL estimates of 11%. Including MVML OPM was at 12.5% compared to IIFL forecast of 13.2%. The disappointment was seen in both automotive and farm equipment segment as EBIT margins for the two segments declined 63bps and 242bps qoq respectively. While other income was lower than expectations, interest and depreciation came in higher than expectations. This resulted in PAT of Rs. 584 crore which was significantly lower than IIFL estimates, including MVML the PAT was at Rs. 668 crore v/s IIFL estimate of Rs. 753 crore.

Result Highlights: (Rs. in crore)

Reported Results IIFL Estimates Variance (%)
Standalone Revenue 10666.43 10377 2.79
Standalone Net Profit 583.73 676 [13.65]

Standalone EPS for the quarter stood at Rs. 9.86.

Bloomberg estimated the company’s consolidated net profit at Rs. 725.48 crore.

Stock Commentary:

Mahindra & Mahindra Ltd is currently trading at Rs. 1345.5, up by 20.8 points or 1.57% from its previous closing of Rs. 1324.7 on the BSE.

The scrip opened at Rs. 1331 and has touched a high and low of Rs. 1349.7 and Rs. 1330 respectively. So far 284870(NSE+BSE) shares were traded on the counter. The current market cap of the company is Rs. 82276.11 crore.

The BSE group 'A' stock of face value Rs. 5 has touched a 52 week high of Rs. 1441.45 on 07-Aug-2015 and a 52 week low of Rs. 1092 on 12-Feb-2016. Last one week high and low of the scrip stood at Rs. 1361.95 and Rs. 1297.1 respectively.

The promoters holding in the company stood at 25.44 % while Institutions and Non-Institutions held 55.47 % and 13.53 % respectively.

The stock is currently trading below its 50 DMA.

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