Mahindra & Mahindra (M&M) said its consolidated net profit declined 11.75 per cent in the April-June quarter to Rs 768 crore from Rs 870 crore in the same period last year. The company claimed to have taken a hit of Rs 94 crore on profit after tax for transitioning to the goods and services tax (GST) regime.
Excluding the GST transition cost, profit of M&M (along with subsidiary Mahindra Vehicle Manufacturers Limited) stood at Rs 862 crore. Total cost of GST transition at profit before tax level stood at Rs 144 crore.
Revenue rose about five per cent to Rs 11,094 crore in the quarter.
“The auto industry saw an impact of the GST transition with the passenger vehicles sales being adversely impacted in anticipation of a price reduction and reporting a nominal growth of 4.4 percent,” said Pawan Goenka, managing director, M&M. The new tax also affected company’s earnings before interest, taxes, depreciation and amortisation (Ebitda), which slipped 2.87 per cent to Rs 1,454 crore in Q1. The Ebitda margins stood at 12.7 per cent.