M&M plunges nearly 3 per cent post announcing price hike of tractors

Taking into consideration the increasing commodity prices, Mahindra & Mahindra (M&M) announced on Monday that it is planning to increase the prices of its tractors. Reacting to this, the stock of M&M soon slumped nearly 3 per cent on BSE.

  Mahindra & Mahindra’s farm equipment sector will effectively reflect an increase in the price with effect from January 1, 2021, but the percentage of price rise would be announced later.  

Previously, the company had also announced of its intent to increase prices of commercial & passenger vehicles from January 1, 2021, as a result of increase in input and commodity costs.

Also read: https://www.dsij.in/DSIJArticleDetail/ArtMID/10163/ArticleID/16135/Mahindra-Mahindra-rises-over-3-per-cent-post-announcing-price-increase-of-vehicles

The automobile sector was also hit in 2020 during the COVID-led pandemic as were all other sectors. Demand & sales had suffered as the company’s sales dropped more than 25 per cent at the end of March 2020 on a YoY basis. September quarter has seen an increase of 44 per cent and amounted to Rs 23,566 crore as compared to Rs 16,321 crore in the previous quarter (July).  

Deputy Managing Director & Group CFO of Mahindra Group, Anish Shah believes that the farm equipment business in particular performed well in the first quarter. Commenting on the quarterly results, he said that the company is still struggling to meet demands.

  Mahindra & Mahindra employs more than 2.5 lakh people across 100 countries, providing innovative mobility solutions and has been a key driver of rural prosperity through automotive & finance segments.  

The stock of M&M has declined more than 2.6 per cent since its previous close of Rs 732.05 on BSE.