New Delhi: Mahindra & Mahindra Ltd posted a strong all-round performance for the third quarter ended December 31, 2025, with operating profit after tax (PAT) surging 66% year-on-year, underpinned by volume growth, margin expansion and improving contribution from group entities.
Consolidated revenue rose 26% year-on-year, with the group crossing the ₹50,000-crore quarterly revenue mark for the first time.
Reported PAT grew 47%, with the difference from operating PAT largely attributable to the Labour Code impact and a one-time reserve release in Mahindra Finance in the base quarter.
Auto: SUVs, EVs Lead Momentum
The auto business remained a key growth engine. SUV volumes grew 26% year-on-year, with the company maintaining leadership in the segment. Revenue market share stood at around 24%.
Margins in the auto standalone business (excluding contract manufacturing) improved 90 basis points to 10.4%.
Management indicated that strong demand for premium variants and top-end trims aided mix improvement.
Electric SUVs continued to gain traction, with cumulative sales crossing 41,000 units and average monthly volumes at around 4,000 units.
The company said EV usage metrics reflect growing consumer confidence, with vehicles clocking significant aggregate mileage.
Light commercial vehicles (LCVs) saw revival aided by GST cuts and replacement demand. Management expects structural improvement in viability for fleet operators following tax rationalisation.
Capacity expansion plans are underway, with incremental additions planned across Nashik and Chakan plants in FY27, and a greenfield facility at Nagpur slated for calendar 2028.
Farm: Strong Volumes, Margin Resilience
The farm segment recorded 23% volume growth in Q3. While market share saw marginal fluctuation during the quarter, January trends indicated recovery. Farm machinery revenue rose 45%, signalling diversification beyond core tractors.
Standalone farm margins remained healthy, though consolidated performance was impacted by impairments in select international subsidiaries, including Japan and Turkey operations.
Management clarified that impairments are now treated within operating profit, reflecting tighter capital accountability.
Mahindra Finance: Pivot to Growth
Mahindra & Mahindra Financial Services Ltd reported a 97% rise in operating profit, as asset quality improved materially. Gross Stage 3 assets remained below 4%, compared to double-digit stress levels seen in previous cycles.
After three years of focusing on asset quality, controls and technology upgrades, the NBFC is now pivoting towards calibrated growth and diversification. Assets under management grew 12% despite a cautious stance on expansion during the clean-up phase.
Growth Gems, Logistics Turn Profitable
The group’s “Growth Gems” portfolio grew threefold year-on-year. Management reiterated that while these businesses are underappreciated by markets, they are scaling steadily and collectively valued at over ₹56,000 crore as per prior disclosures.
Logistics posted its first profitable quarter in 11 quarters, aided by leadership changes and operational tightening. Real estate arm Lifespaces saw profits multiply fivefold, supported by project completions and external capital infusion, including investment from Mitsui Fudosan.
Commodity Pressures, Pricing Discipline
Management acknowledged inflationary pressures across commodities, particularly precious metals and iron-linked inputs. While hedging programmes have mitigated near-term impact, selective price hikes of around 1% have been implemented.
Executives indicated pricing power exists but will be exercised judiciously to preserve competitive positioning.
Macro Outlook: Structural Tailwinds
The company maintained an optimistic medium-term outlook, citing infrastructure build-out, demographic advantage, and policy reforms. Management projected India’s real GDP growth potential at 8–10% over the next two decades, compared to a historical average of 6.5%.
While acknowledging uncertainties such as emission norms (CAFE) revisions and weather-related risks in the tractor market, the leadership expressed confidence that structural enablers outweigh short-term headwinds.