• Downside in Operating income is attributable to lower revenue from both supply chain management (SCM) business as well as Enterprise Mobility Services (EMS) hit by full impact of nationwide lockdown in relation to COVID 19. The segment revenue of EMS was down by 82% to Rs 17.82 crore (or 4% of sales) hit by most of customers extend WFH option for majority of their employees. However the segment revenue of SCM was down by 51% to Rs 392.64 crore (or 96% of sales).
  
• In SCM while the M&M business registered a fall of 65% (to Rs 172.1 crore) that of non M&M revenue was down by 29% to Rs 220.5 crore. Similarly in SCM while the warehousing and other value added services reported a fall of 14% to Rs 120.4 crore that of transport was down by 59% to Rs 272.2 crore. On splitting the non M&M SCM revenue in terms of auto and non-auto both declined with former registering a fall of 56% (to Rs 35.5 crore) and non-auto down by 19% to Rs 185 crore.

• EBIT was down by 68% to Rs 23.39 crore with the segment profit of SCM stand decline sharply and that of EMS report a loss for the quarter(from profit in corresponding previous quarter). EBIT of SCM was down by 63% to Rs 24.06 crore hit by sharp fall in sales as well as 190 bps contraction in segment margin to 6.1%. The EMS business, registered a loss of Rs 0.67 crore compared to a profit of Rs 9.49 crore.   

The Company has applied the practical expedient available as per the amendment to IND AS 116, "Leases", to all rent concessions occurring as a direct consequence of the COVID 19 pandemic and Rs. 0.98 crores has been recognised in the results for the quarter ended 30th June, 2020 to reflect changes in such concessions in lease payments 

Consolidated sales was down by 10% to Rs 3471.14 crore. But a 70 bps rise in OPM to 4.6% saw the operating profit up by 5% to Rs 158.27 crore. Spurred further by 83% jump in OI to Rs 13.98 crore, the PBIDT was up by 8% to Rs 172.25 crore. After accounting for higher interest and depreciation the PBT was down by 39% to Rs 81.19 crore. With taxation stand lower by 45% to Rs 46.79 crore, the PAT was down by 36% to Rs 55.45 crore. After accounting for higher share of loss from associate (jump 144% to Rs 0.61 crore) and lower minority interest (a swing of Rs 1.04 crore to a share of loss of Rs 0.28 crore) the net profit was down by 36% to Rs 55.12 crore.  

Segment profit of SCM was down by 5% to Rs 252.92 hit largely by lower sales (down 10% to Rs 3103.53 crore) as its segment margin expanded by 50 bps to 8.1%. However hit by lower sales (down 5% to Rs 367.61 crore) and lower segment margin (130 bps contraction to 9.2%) the segment profit of EMS was down by 17% to Rs 33.81 crore.  

The Company has adopted Ind AS 116 'Leases' with the date of initial application being April 1, 2019 using the modified retrospective approach. The Company has-applied the standard to its leases with the cumulative impact recognized on the date of initial application. Accordingly, previous period information has not been restated. In the profit and loss for the current year, the lease rent which was hitherto accounted under "Operating Expenses" and "Other Expenses" in previous periods has now been accounted as depreciation cost for "right — of — use" of asset and finance cost for the interest accrued on lease liability. Accordingly, reported profit before tax for the fiscal ended Mar 2020 is lower by Rs 5.47 crore from comparable basis. 

Other developments 

The Investment committee of the Board of Directors of the Company, at its meeting held on 27th June, 2020 approved purchase of additional stake (upto 16.13%) in Lords Freight (India) Private Limited, Subsidiary Company ("Lords"). In line with the said approvals, the Company has completed purchase of 3,80,970 equity shares of Lords (representing 16.13% of Lords) from its then Shareholders for a consideration of Rs. 4.00 crores, resulting into an increase in the Company's stake in Lords from 82.92% (pre-acquisition) to 99.05% (post-acquisition) as on 30th June, 2020. 

Commenting on the performance, Rampraveen Swaminathan, Managing Director and CEO of Mahindra Logistics, said, "In these challenging conditions, the company has delivered a resilient performance with strong customer retention, cost reduction and improved cash flows. The quarter was expectedly a tough quarter, with the full impact of nationwide lockdowns and disruptions due to the Covid-19 pandemic. Significant reduction in industrial activity, widespread Work From Home (WFH) and lower business sentiments has impacted the overall economy and the industry. We witnessed sequentially improving May & June, while the demand remains below pre-Covid19 levels in most end markets. Our employees' health & safety has been our top priority, and we launched programs for safe return to work, skilling and wellness. We have partnered closely with our customers in providing essential services. Our support to the communities included providing Alyte' emergency cab services, driver relief through the HOPE program and undertaking other community relief programs. Economic activity has started improving and we are well positioned to drive recovery in the coming quarters. We have grown our customer relationships in E Commerce, FMCG & Pharma, and continue to strengthen our focus on delivering solutions, driving operations excellence and leveraging technology."