Mahindra & Mahindra Ltd. (M&M) and its subsidiary Mahindra Vehicle Manufacturers Ltd., on Friday reported a consolidated net loss of ₹3,255 crore for the quarter ended March 31, compared with a profit of ₹969 crore in the year earlier period.

Revenue declined 35% to ₹9,005 crore as domestic vehicle sales tumbled 47%, exacerbated by the lockdown to prevent the spread of COVID-19. The company recognised a loss of ₹2,780 crore for the quarter as ‘exceptional items’, on account of impairment provision for certain long-term investments, it said.

“80% of this is due to impairment provisions at SsangYong Motor, the South Korean subsidiary, and GenZe, the electric scooter subsidiary in the U.S.,” said Anish Shah, deputy MD and group CFO, M&M.

M&M has decided not to invest any further capital in SsangYong Motor and has started looking for an investor. The company is willing to shed majority control in SsangYong if need be, said MD Pawan Goenka. The automotive group has also decided to shut down GenZe and put all loss-making units under review. Their performance, to be evaluated in the next 12 months, would decide whether they would continue, Mr. Goenka added.

Global deals paused

Owing to the unprecedented situation arising out of COVID-19, the company has decided to slam the brakes on fresh international acquisitions; and focus on protecting the core business and strengthening its nine unlisted entities, including Classic Legends and the agri business, which have potential for growth, Mr. Shah said.

He said the focus would be on enhancing shareholder value, adding that the firm, with cash reserves of ₹12,554 crore, had enough capital to meet any eventuality and continue the business.

For the full financial year, revenue declined 15% to ₹44,866 crore and profit after tax plunged 86% to ₹740 crore. Performance was affected due to lower industry volumes in both the automotive and tractor segments, the transition to BS-VI and the abrupt lockdown due to the pandemic, the automotive company said.

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