Mahindra’s profit slides on one-time Ssangyong hit – Times of India

BENGALURU: Mahindra and Mahindra (M&M) Ltd reported a droop in third-quarter profit on Friday, because the carmaker reported a one-time loss on its South Korean unit Ssangyong Motor which has filed for chapter
Mahindra, as half of a wider evaluate to retain solely these companies with the potential to earn cash, has been in talks to promote its stake in Ssangyong.
The South Korean automaker, nevertheless, filed for a pre-packaged rehabilitation chapter plan in December “which may involve capital restructuring for existing and current shareholders”, Mahindra stated in an announcement.
Mahindra estimates it should incur a one-time loss of Rs 1,210 crore ($166 million) associated to Ssangyong and the unit may even stop to be its subsidiary.
Upon approval of the chapter plan, “the court will commence rehabilitation proceedings and appoint a receiver to manage the affairs of the company”, Mahindra stated.
On a standalone foundation, profit after tax was Rs 30.93 crore for the quarter ended December 31, in contrast with Rs 307 crore a 12 months earlier, Mahindra stated right here.
However, Mahindra’s standalone ends in mixture with these of its manufacturing unit translate to a profit after tax of Rs 531 crore for the third quarter, a 40% leap from the identical quarter a 12 months earlier.
“Capital allocation actions were targeted at loss-making subsidiaries, these actions have made a significant contribution to the financial performance,” it stated.
Mahindra, which final month stated would improve costs of its private and business automobiles, continued to warn of challenges because of a scarcity of semiconductors and rise in commodity costs.
As half of its evaluate, Mahindra has additionally ended its three way partnership with Ford Motor Co and has reduce greater than half of the workforce at its North American unit.

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