In the January–March 2025 quarter (Q4FY25), Mahindra & Mahindra reported consolidated revenue of ₹31,353 crore, net profit of ₹2,437 crore and EBITDA margin for the quarter stood at 14.9%.
The company’s focus remains on maintaining margin levels on a like-to-like basis, without compromising on volume momentum.
Jejurikar also observed that while there has been some pressure on urban demand in the broader market, Mahindra hasn’t experienced that stress in its own portfolio. In fact, the company recorded a 28% growth in its SUV segment in April.
Jejurikar expects urban demand to strengthen over the next three to six months, aided by factors such as the recent changes in income tax slabs, which have boosted disposable incomes, and the softening of interest rates, which improve affordability of car loans.
He noted that a stabilising stock market should also help lift urban consumer sentiment, which often influences big-ticket purchases like cars.
This is the edited excerpt of the interview.
Q: Let us start with the margin picture, because not only a volumes gone up and that we see on a monthly basis when the numbers come, but you have managed a good show on the margins as well.
A: It is of course, much easier when the quarter has been good. What is particularly gratifying, are the tractor margins. Because normally quarter four market share is stressed for us. But we gained very strongly on tractor market share. It has been one of our best quarter for tractor so what we called core tractors, without farm machines and other things, was as high as 20.8% PBIT margin on core tractors, which for a quarter four volume was really good. So that was a strong number to put out.
The auto margins have been also very strong. And it is the best peer margin by far in quarter four. We have had a good margin performance on both the tractors and auto.
Q: Question is, can you build on that from here on? Because commodity inflation seems to be benign, is that your own assumption going into FY26 and plus, then you have operating leverage coming in on the tractor side, your exports are firing, and then even autos, you have got so many new launches. What’s the expectation on margins from here on?
A: We don’t put out a margin expectation. We have put out a volume expectation for SUVs just now. We are saying mid to high teens for SUVs including electric and for tractor industry, we are saying high single digit and for LCV less than three and a half tonne, we are saying high single digit. In a way, the volume momentum should be good.
To your point on commodities – it is very hard to say. It’s a very volatile world. But right now, our sense is it will be reasonably benign.
Q: Directionally, can margins go up to your mind, at least for the first two quarters?
A: The way I would answer that question is – the point is to focus on the right metrics. As long as you are focusing on the right metrics, outcomes follow. If we start focusing solely on increasing margins, the typical answer is to reduce volume. Our focus is on how we keep volume momentum going up while keeping costs under control.
If we do that, margins tend to improve in most situations. But if you put the cart before the horse and ask how to increase margins, you end up making decisions that affect demand. And in a volume-driven industry, affecting demand means you won’t gain margin anyway.
Q: Is this sustainable? We are talking 9.2% for auto and 19.4% for tractor. Are these margin levels sustainable with your current volume mix?
A: Without giving guidance, let me offer some perspective on how to think about it. Next year, we will start seeing a much higher EV proportion in the mix. We have said EV margins as a percentage will be lower, even though EVs may make the same unit margin as ICE, simply due to the denominator effect. So, when we look at blended margins, we are going to see them lower than in the past. But on a like-to-like basis, we want to sustain margins without losing volume momentum. That’s not a guidance—it’s an effort management would like to make work.
Standalone margins now also include the contract manufacturing we do for electric vehicles within M&M, and that dilutes margins because it only carries a conversion cost on total value. M&M’s Auto division makes electric vehicles and sells them to Mahindra Electric Company, and that’s only on an additive conversion cost, so the percentage margin is much lower. We will show that separately in the analyst call in the afternoon.
Q: What is the updated market share on SUVs, EVs, and tractors? Where did you end FY25, and where do you see that heading?
A: Let us look at the three segments. Starting with tractors—this has been our highest-ever tractor market share at 43.3% for the year. We have gained market share two or three years in a row, which is uncommon in a market where it’s not easy to gain share. We always say that tractors are a sticky business with low entry barriers, meaning it’s not easy to gain share. So, having gained share two years in a row and being at 43.3% is very reassuring.
For auto, we look at revenue market share for SUVs because our average selling price is significantly higher than that of our competitors. We crossed 22% revenue market share and gained 1.8 share points in the year. Even though we don’t measure volume market share in SUVs, we have been the number two volume player consistently for many quarters. That is not a metric we chase—we won’t do things that aren’t part of our brand DNA.
We are clear that there are some segments we won’t play in where we don’t have a right to win. Every time we release a new product, we want people to say “wow.” If more customers feel the same, that leads to market share gains. But we don’t want to be seen as just another car on the road with no brand recall.
The strongest story is in LCVs under 3.5 tonnes. We have gained significant market share there—we now have over 50% market share. South, where we were not so strong earlier, we launched Veero six months ago, which is helping us gain share in that segment. Across the three segments we play in—we have seen very good share gains. In last-mile mobility, or electric three-wheelers, we continue to be number one with around 39–40% market share.
Q: How should we look at you volumes versus last year for tractors and autos?
A: For tractors, our first objective is to sustain this current market share—it is a very good market share. We wouldn’t want to start discounting to grow share. We have been focused on ensuring that tractor market share growth is led by product and reach, not pricing. We could gain share quickly by diluting margins, but we are trying to balance between the market share gain and margins. We would want to keep that balance. We want to avoid saying, “Yes, we will gain market share,” and then resorting to discounting. That’s not our approach.
Q I wanted to ask about the stress we are seeing in urban demand. Rural looks strong, but urban demand seems soft. Can you shed some light on that?
A: There has been some stress in urban demand, but we haven’t seen it in our portfolio. We got good growth in April—our SUV portfolio grew 28%. Over the next three to six months, I believe urban demand will improve. One factor is the change in income tax slabs that started in April, which releases more cash. Interest rates are trending downward, which improves cash flow and borrowing costs for things like car loans. These factors are more significant for urban customers. It’s also good to see the stock market stabilising—that affects urban sentiment. When people feel their wealth is eroding, they postpone buying cars. With the market recovery, we expect sentiment to improve.
Q: What’s the current waiting period on your vehicles?
A: The product on which we right now have most waiting period is Roxx, and that is a few months. We are increasing the capacity somewhat, but overall Thar demand, including three door, has been robust. We’ve ramped up Thar. Now Thar, as a portfolio, in April, crossed 10,000 for the first time. So three door and five door together, we sold more than 10,000 that’s quite a journey for a product like Thar, which used to five years back, sell 600 a month. So it’s moved to selling more than 10,000 a month, which is what we have ramped up to.
On the question of EVs, the waiting period is four months. We are going to follow very calibrated approach to ramping up for two, three reasons. One, we always knew that on the production side, lot of new technologies, software, new features, and we have to ramp it up slowly as we stabilise the quality. But what we also learning is from a customer experience at time of delivery – a delivery event in an electric vehicle takes at least two hours. In internal combustion engine (ICE) – it was literally a puja, a key hand over and you drive off.
But here customers come in with entire family, so many questions, a lot of explanation to be done. Then we need a follow up visit to the customer again, to walk them through all the features and how they are to be used, setting up the charging so we don’t want to be messing up on the customer experience in our desire to get lots of vehicles out in a hurry.
Q: Any update on SML and when that integration happens? Also, with Tesla and other American automakers eyeing India again, could that disrupt the Mahindra story in any way?
A: If you look back at the Indian story over the last 20 years or more, the Indian customers are probably the most sensible and the hardest to fool. They will not buy anything that does not make sense. And when I say that the price has to be right, it has to have everything. It has to work well on Indian roads. It has to last long. It should give a good resale price at the end. So there is every parameter which goes in, including demand, brand and all of – the aspirational value and all of that.
But that has to be well calibrated. So any player who wants to just bring in a product which is doing well anywhere else in the world, and then say, yeah, it’s going to naturally do well here, because it’s done somewhere else. I don’t think we’ve seen a story like that play out in India at all, not in tractors, not in commercial vehicles, and not in cars.
M&M’s current market capitalisation is ₹3,75,719 crore. The stock is currently trading at ₹3,024 as of 3:30 pm on the NSE and has gained 35% over the last year.
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