Mahindra & Mahindra Issues Clarification After Its Shares Decline Over 6.6%

Mahindra & Mahindra Share Price Latest: Mahindra & Mahindra (M&M) on Wednesday issued a clarification after its shares declined as much as 6.62 per cent following the price cut on its flagship SUV XUV700. It said “our new XUV700 bookings in June were 23% higher than May and there is no concern of unsold inventory” and adding that there is no linkage between the price cut on certain XUV700 variants and UP EV/hybrid policy.

Shares of Mahindra & Mahindra (M&M) on Wednesday declined as much as Rs 193.7 or 6.62 per cent to end the day at Rs 2,732 apiece on the BSE. It posted the biggest plunge on the Sensex among other companies. The fall in M&M’s shares comes after the company reduced the prices of its sports utility vehicle XUV 700 by Rs 2 lakh.

Though market analysts termed the price cut as an indication of demand weakening, the company rubbished the claim.

In a regulatory filing on Wednesday, Mahindra & Mahindra said, “We wish to inform the stock exchanges that there is no linkage between the price cut on certain XUV700 variants and UP EV/hybrid policy as reported by some media. The announced price cut of XUV700 is a continuation of our business strategy execution that was articulated in our 14th February 2024 analyst meeting where we clearly outlined that ‘we have to bring the average price point down to drive growth’.”

We kickstarted this effort with the launch of AX5 select variant in May 2024 and have also brought in a third anniversary celebration variant for the higher-end XUV700 for a limited period of 4 months. These well deliberated actions were incorporated in our annual business plan basis the material cost savings realised earlier and hence we do not expect any material impact on our financials.

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“The demand for the XUV700 continues to be robust and we have increased our manufacturing capacity in line with demand. Our new XUV700 bookings in June were 23% higher than May and there is no concern of unsold inventory as reported by certain news channels/newspapers,” M&M added.

The company firmly believe that hybrid is an interim and costly solution. And, we have the readiness to offer high quality products for all solutions that our consumers desire, it added.

Mahindra on Tuesday announced a price reduction on its flagship SUV, the XUV700, spanning a four-month period, in celebration of its third anniversary. The price cut sees prices for the top-spec XUV700 AX7 now starting at Rs 19.49 lakh and going up to Rs 24.99 lakh (ex-showroom, Delhi).

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Shares of Maruti Suzuki, which were in green in the morning, also slipped by Rs 44.75 or 0.35 per cent to close at Rs 12,775.45 apiece on the BSE. Tata Motors also fell on Wednesday by Rs 9.30 or 0.92 per cent to close at Rs 1,005.45.

The BSE Sensex, which opened on Wednesday at all-time high levels, ceded its gains and crashed as much as 900 points during the day. After a volatile trade, the Sensex finally closed lower by 426.87 points 0.53 per cent at 79,924.77.

Shares of Maruti Suzuki, which were in green in the morning, also slipped by Rs 44.75 or 0.35 per cent to close at Rs 12,775.45 apiece on the BSE. Tata Motors also fell on Wednesday by Rs 9.30 or 0.92 per cent to close at Rs 1,005.45.

The BSE Sensex, which opened on Wednesday at all-time high levels, ceded its gains and crashed as much as 900 points during the day. After a volatile trade, the Sensex finally closed lower by 426.87 points 0.53 per cent at 79,924.77.