M&M expects chip crunch, pandemic to hurt first quarter
Mahindra and Mahindra, the farm equipment and utility vehicles specialist, on Friday warned that a global chip shortage, rising commodity prices and pandemic-induced lockdowns threatened its business in the first quarter of the current finanical year (FY22.)
The maker of popular Scorpio and Bolero models said apart from the chip shortage triggered by factors including pandemic-driven supplychain disruptions, the auto industry is under pressure from the severe second wave of Covid-19 infections that have led to a fresh round of lockdowns. However, the Mumbai-based automaker expects demand to rebound in June and July as states open up in a phased manner.
“We are ramping up production and we believe there will be a strong demand rebound as we get out of lockdowns between JuneJuly,” Rajesh Jejurikar, executive director at Mahindra and Mahindra said, adding that the auto sector could take a month or two longer to rebound.
He said the company has not seen any cancellations in bookings despite a large number of people waiting for their orders.
Mahindra on Friday posted a consolidated profit after tax (PAT) from continuing operations of Rs 1,635 crore for the fourth quarter.
The company had reported a consolidated net loss of Rs 588 crore in the same period last fiscal, M&M said in a regulatory filing.
The company's board also gave its nod to the highest-ever dividend of Rs 8.75 per share for the financial year 2020-21 to commemorate its 75th year in business.
The consolidated revenue from operations stood at Rs 21,456 crore during the JanuaryMarch quarter under against Rs 16,315 crore in the corresponding period of the last fiscal.
For the entire 2020-21 fiscal year, the company reported a consolidated PAT of Rs 3,702 crore as compared with Rs 2,713 crore in 2019-20.
Revenue from operations stood at Rs 74,278 crore for the financial year, as against Rs 75,382 crore in 2019-20.
On a standalone basis, the automaker reported a PAT of Rs 48 crore for the fourth quarter. The firm reported a net loss of Rs 2,502 crore in the yearago quarter.