GST launch impacts the sales growth of Mahindra and Mahindra passenger vehicles which put a negative effect on the first quarter profit of the company by a decline of 19.8%.
The company statement said that the company generated a net profit of Rs 860 crore without taxes and with taxes the amount falls directly to Rs 766 crore which is profit after tax. The company also stated that is the same quarter last fiscal they had successfully earned profit of Rs 955 crore.
The company said revenue from operations generated in the first quarter in FY17 is Rs. 12,336 crores and last year in the same quarter the company earned Rs. 11,943 crore which is 3.3% rise.
Pawan Goenka, MD of MM said, This was an eventful quarter, to say the least. It started with the BS-III (phasing out of vehicles complying with BS-III emission norms), which was nothing less than a bombshell, and it was followed by the GST transition. The industry though has managed these disruptions quite well.
Goenka further added, Due to the unavailability of input credit for certain taxes paid, as well as due to tractors being exempt from excise duty in the earlier regime, we made provision for dealer support in respect of duty paid goods lying with dealers amounting to Rs. 144 crore.
Total sales of companys vehicles were 1,12,293 in Q1 of current year against 1,10,959 units in Q1 of last year.