Mahindra CIE Automotive hosted a conference call on April 26, 2023. In the conference call, the company was represented by Mr. Ander Arenaza Alvarez- CEO, Mr. K. Jayaprakash- CFO and Mr. Vikas Sinha- Sr. VP.

Key takeaways of the call

In India, tractors sales during Q1 CY23 increased by 34.7%, two wheelers sales fell 3%, MHCV sales fell 8.8% and <6T vehicles (include Passenger Vehicles, Utility Vehicles, Vans and Light Commercial Vehicles) went up by 9.4% compared to Q1 CY22.

Management indicated that, all business in India are performing well with positive expectations.

Out of the total capex, significant portion (around 80%) will be allocated to India business.

In Europe, <6T vehicles (include Passenger Vehicles, Utility Vehicles, Vans and Light Commercial Vehicles) sales during Q1 CY23 increased by 17.5% compared to Q1 CY22.

Europe Sales remain strong despite the uncertain market environment. Sales was helped by positive exchange rate impact of 6% in Q1 CY23. Margin was positively affected mainly by energy price reduction after huge increases in last quarters.

In Q1 CY23, company clocked its highest EBITDA margin ever. Management expects margin to sustain going forward.

Company delivered positive performance supported by growth and profitability in India and sales and margin recovery in Europe.

Management indicated strong outlook on Indian business and stability for European region.

Company is working with several customers to get new business in EV segment. Company has already bagged 2-3 new businesses. Management expects EV penetration to increase going forward.

Company is open to inorganic growth opportunities to grow ahead of the market.

Company is slowly increasing its capacity in Metalcastello.

Company has applied for name change from Mahindra CIE Automotive to CIE automotive India.

As on 31 March 2023, the consolidated financial results have foreign currency translation reserve (FCTR) (under other equity) pertaining to the disposal group amounting to Rs 201.2 crore, which will be credited to Profit and Loss at the time of actual disposal, as per the Indian Accounting Standards.

The Board of Directors recommended final dividend of Rs 2.5 per Equity Share of Rs 10 each fully paid up for financial year ending December 31 , 2022.