M&M share price today: Why is Mahindra & Mahindra shares falling 6.4% today?
M&M share price today: Shares of Mahindra & Mahindra (M&M), the automotive and farm equipment flagship of the Mahindra Group, slumped 6.4% in today’s early morning trade to ₹2736 apiece, a day after the company announced a temporary price cut of up to ₹2 lakh for its top XUV700 variant, the XUV700 AX7.
The new pricing has been introduced ahead of the XUV700’s third anniversary and will be effective for a limited period of four months starting July 10.
This move aims to enhance sales and make the feature-rich AX7 trims more accessible to buyers. According to the carmaker, “The Mahindra XUV700’s fully loaded AX7 range, now starting at ₹19.49 lakh, will enable more people to experience its unmatched driving experience with cutting-edge premium features.”
Are SUVs facing a slump in demand?
In addition to M&M, Tata Motors has also implemented price cuts on its SUVs, the Harrier and Safari, effective until July 31. Analysts interpret these price reductions by major players as indicative of weakened demand in the segment. They attribute this trend to reduced inquiries and postponed vehicle purchases, exacerbated by extreme heat waves affecting consumer behavior.
Meanwhile, XUV700 became the fastest Mahindra vehicle to achieve 1.5L + vehicle sales within 30 months of launch. XUV 700 reinforced its superior Sci-F credentials by bringing the new 2024 lineup.
In FY24, the company experienced significant growth in its SUV revenue market share, climbing by 130 basis points year-on-year to reach 20.4%. This remarkable achievement was fueled by the company’s best-ever sales performance, with a total of 459,877 units (SUVs) sold during FY24.Scorpio, Thar, XUV700, and Bolero continued to be strong brands for the company in the UV segment. The company strengthens its UV product portfolio, attracting lower tax rates.
India has traditionally seen a tax rate differential between small and large passenger vehicles. This differential is based on the length of the vehicle, engine size, and fuel type.
While the flagship products of the company attract higher tax rates, the company has strengthened its UV product portfolio, attracting lower tax rates with products like the XUV300, Bolero Neo, Bolero Power Plus, and Thar. The XUV400 attracts the minimum GST among all passenger vehicle categories.
Internationally, theXUV700 has gained significant traction in Australia, contributing to a substantial increase in retail sales. In South Africa, the Scorpio-N ranks among the top SUVs in the body-on-frame segment, while the XUV300 in Tunisia was honoured with the Golden Wheel 2023 award for “Best Seller in its Segment,” according to the company’s FY24 annual report.
Highlighting its capabilities, the Scorpio-N achieved a Guinness World Record for the fastest crossing by a production vehicle of the Simpson Desert in Australia. The company remains committed to strengthening its global footprint through a diverse portfolio of SUVs and commercial vehicles, underscoring its continued focus on global operations.
A year of strong growth and market leadership
The company achieved total sales of 8,24,939 vehicles in FY24, comprising 7,46,833 four-wheelers and 78,106 three-wheelers. This marked 18.1% growth compared to the previous year’s total of 6,98,456 vehicles (6,39,374 four-wheelers and 59,082 three-wheelers).
In the domestic market, Mahindra sold a total of 8,00,276 vehicles, up from 6,66,349 vehicles in the previous year, reflecting a robust growth of 20.1%.
Within the passenger vehicle (PV) segment, Mahindra recorded sales of 4,59,877 vehicles, which includes 4,59,864 utility vehicles (UVs) and 13 vans. This marked a significant increase from the previous year’s sales volume of 3,59,253 vehicles, comprising 3,56,961 UVs, 2,078 vans, and 214 cars, reflecting a notable growth of 28%.
During the fiscal year, the overall Indian automotive industry (excluding 2-wheelers) expanded by 10.1%, with the passenger vehicle (PV) segment growing by 8.4% and the commercial vehicle (CV) segment growing marginally by 0.6%.
The UV segment, where Mahindra has a strong presence, showed robust growth of 25.8%. Within the CV segment, the Light Commercial Vehicles (LCV) goods segment declined by 2.9%, while the Medium and Heavy Commercial Vehicles (MHCV) goods segment saw a marginal decline of 0.2%.
