(Adds quotes, details)
By Swati Pandey
MUMBAI May 30 Mahindra and Mahindra Ltd
, India's biggest sports utility vehicle (SUV)
manufacturer, warned that growing competition would erode its
market share after posting a forecast-beating rise in quarterly
"With so much competition in SUVs now, market share is bound
to go down," Pawan Goenka, president of Mahindra's automotive
and farm equipment sectors, said on Thursday.
The flagship company of the $15.9 billion Mahindra Group
builds every other SUV sold in India, but saw its share of the
segment fall to 48 percent in its fiscal year 2012/13 from 56
percent a year earlier.
Mahindra will soon compete with automakers including Ford
Motor Co and Japan's Suzuki Motor Corp which plan
to launch SUVs in India during the current year. Another rival
is set to come from Nissan Motors and Maruti Suzuki
"The competitive intensity is something which is likely to
go up, so to avoid losing market share it depends how fast
Mahindra is able to launch new products," said Ajay Shethiya,
analyst at Mumbai-based brokerage Centrum.
Shethiya expects the company's SUV business to grow by
between 8 and 10 percent in 2013/14.
Mahindra's net profit for its fiscal fourth quarter reached
8.89 billion rupees ($158.2 million), against 8.74 billion a
year earlier on a 12 percent rise in net sales to 103.5 billion.
Analysts had on average expected a profit of 7.62 billion
rupees on revenue of 99.86 billion, according to data from
Thomson Reuters Starmine.
Mahindra said automotive sales, including exports, jumped 17
percent in the year ended March 31, as strong demand for its
SUVs helped defy the gloom in much of India's car market.
Car sales in India fell an annual 6.7 percent in the 12
months to March 31, their first fall in a decade, and are
expected to grow just 3 to 5 percent this year, down from an
original forecast of 10 to 12 percent, an industry body has
Mahindra, which controls South Korean car maker Ssangyong
Motor Co Ltd, said it plans to invest 75 billion
rupees in its business over the next three years.
Shares in Mahindra, valued at around $10.5 billion by the
market, ended 4.5 percent higher at 1,004.65 rupees in a strong
($1 = 56.1850 Indian rupees)
(Writing by Aditi Shah; Editing by Jeremy Laurence and David