M&M's Q2 profit rises 25%, but farm business remains weak

Mahindra & Mahindra Limited (NSE: M&M) reported Q2 FY27 consolidated revenue of ₹57,553 crore and profit after tax of ₹4,588 crore, both up 25% year on year. Its automotive business delivered 55% PAT growth, while farm revenue declined 6% and farm PAT fell 9%. What happened The automotive business was the main growth driver. Consolidated automotive revenue increased 39% to ₹37,756 crore, while PAT rose 55% to ₹2,388 crore. Total vehicle volumes, including sales through its last-mile mobility and electric vehicle subsidiaries, grew 26% to approximately 3.31 lakh units. The farm equipment business had a weaker quarter. Revenue declined 6% to ₹9,572 crore and PAT fell 9% to ₹1,053 crore. Standalone tractor sales were down 6% at 1.16 lakh units. Why it matters The headline 25% growth in consolidated earnings is strong, but the underlying businesses are moving at different speeds. SUVs continue to drive growth, supported by a 26% increase in vehicle volumes and a 24.3% SUV revenue market share. Farm performance is a watchpoint. Management attributed the decline partly to a shift in the festive calendar. However, tractor volumes and farm profitability need to recover before the weakness can be considered temporary. What to watch next Track SUV volumes, automotive profitability and the ability to sustain market share. In the farm business, the next few months of tractor demand will help establish whether the Q2 weakness was primarily seasonal or more persistent. Standalone EBITDA growth relative to revenue is another important metric. Stance: Constructive on the automotive franchise and consolidated growth, but not uniformly bullish across the group. A recovery in farm demand and better standalone operating leverage would strengthen the earnings outlook.