Farm leads the way in M&M’s Q2 results, auto impacted by transition in GST

Mahindra & Mahindra said on Tuesday that its farm sector performed robustly in the second quarter, whereas the transition in the GST structure impacted the auto sector. The volumes for tractors grew 32%, whereas for auto it was 13%, and for SUVs, it was 7% year-over-year.

“Farm has led the way (in our results) …We have seen very strong operational excellence in the farm sector,” said Anish Shah, CEO and MD, Mahindra & Mahindra, in a press conference. According to Rajesh Jejurikar, ED and CEO, Auto and Farm Sector, M&M, the company is raising its growth guidance for the farm sector from mid-to-high single digits to low-double digits for FY26.

“A better monsoon and lower GST on tractors have helped drive demand for tractors. MSP yields have been better. The government spending on the rural economy is continuing at a good level. We are also seeing an improvement in exports of food produce,” he said, adding that the convergence of these factors has bumped up demand in the farm sector.

In the auto sector, Jejurikar explained that issues related to transitioning to the new GST structure, logistics challenges, and container scarcity impacted demand during the quarter. “We were also holding back dispatches before the GST rates came into effect on September 22,” he added. Consequently, Jejurikar said that the dealer physical inventory for ICE utility vehicles is lower than usual and currently stands at 15 days.

Still, Jejurikar said that GST is a trend response, and is seeing customers upgrade to higher models. “In the ICE portfolio, for the Mahindra XUV700, the demand is skewed towards the top two trims. Similarly, in the Mahindra Thar Roxx, the demand is skewed towards the top trims,” he added. On demand beyond the festive season, Jejurikar said the post-festive season has remained robust. “It hasn’t fallen significantly as it usually does. Farmers will have cash in hand after the harvest. November is expected to show a good level of performance for both farm and auto with a lot of auspicious days.”

Regarding rare-earth magnets, Jejurikar said the company is well-covered for the financial year, whereas on Nexperia chips, Mahindra is covered in the short term. “It is easier for us to de-risk. It’s a cheaper, 20-cent chip. Multiple geopolitical conversations are happening, and a solution should emerge,” he added.

Mahindra & Mahindra also revealed that it has sold more than 30,000 units of its Born Electric lineup—the BE6 and XEV9. “We have got excellent feedback from the customers. The range anxiety is going away. South India is emerging as a good market for BE vehicles,” Jejurikar added. According to Shah, however, the EV business does not contribute much to profits at present, but it will in the future.

The company reported a consolidated revenue of ₹46,106 crore, up 22% from last year. Its consolidated PAT has grown 28% to ₹3,673 crore. The farm machinery segment reported its highest-ever quarterly revenue of ₹330 crore, whereas the consolidated revenue of the farm segment was ₹10,225 crore, up 25%. The revenue for the standalone auto sector was ₹24,929 crore, whereas for electric mobility it was ₹3,287 crore, and the company reported an Ebitda of ₹173 crore.

Mahindra shares closed 1% higher on Tuesday at ₹3,584.30 apiece.