Shares of Mahindra & Mahindra (M&M) dropped by 6.4% to ₹2736 each after the company announced a temporary price reduction of up to ₹2 lakh for its top XUV700 AX7 variant.
Key Points:
- Price Cut Details: The price cut is effective for four months starting July 10, ahead of the XUV700’s third anniversary.
- New Prices: The fully loaded AX7 trims now start at ₹19.49 lakh, with the AX7 Petrol-MT 6-str reduced from ₹21.54 lakh to ₹19.69 lakh, a cut of ₹1.85 lakh.
- Reason: The aim is to boost sales and make the AX7 more accessible.
SUV Market Trends:
- Other Price Cuts: Tata Motors has also reduced prices for its SUVs, Harrier and Safari, until July 31.
- Analyst Views: These price cuts suggest weakened demand in the SUV segment, partly due to fewer inquiries and delayed purchases, exacerbated by heat waves.
Sales Performance:
- XUV700 Success: Fastest Mahindra vehicle to reach 1.5 lakh sales in 30 months. Achieved significant growth in SUV market share in FY24.
- Strong Brands: Scorpio, Thar, XUV700, and Bolero continue to perform well.
- Lower Tax Rates: Mahindra has strengthened its UV product portfolio with vehicles that attract lower tax rates.
International Success:
- Global Footprint: The XUV700 has gained traction in Australia and South Africa. The Scorpio-N achieved a Guinness World Record for the fastest crossing of the Simpson Desert in Australia.
Overall Growth:
- Sales Increase: Mahindra sold 8,24,939 vehicles in FY24, marking an 18.1% growth from the previous year.
- Domestic Market: Sales increased by 20.1% in the domestic market.
- UV Segment: Recorded a 28% increase in the passenger vehicle segment, particularly in utility vehicles.
The stock dip reflects the market’s reaction to the price cuts, despite the company’s strong overall performance and growth in both domestic and international markets.
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