India’s largest maker of sport utility vehicles and tractors Mahindra & Mahindra Ltd reported profit that missed analyst estimates for a fourth straight quarter as rising raw material costs offset higher sales.

The company’s net income, excluding subsidiaries, fell to INR 6.62 billion (USD 134 million) in the three months ended December 31st from INR 7.35 billion a year earlier. That compares with the INR 6.84 billion median of 32 analysts’ estimates compiled by Bloomberg. Sales climbed 37% to INR 83.3 billion.

According to the statement, the maker of Xylo and Scorpio vehicles spent INR 45.8 billion or 21% more on raw materials in the quarter. Mahindra, which raised prices by as much as 3% last month, said yesterday it expects margins will continue to be under pressure.

Mr Umesh Karne an analyst at Brics Securities Ltd. in Mumbai said that “Higher costs of inputs like rubber and steel have dented profit margins. Margin pressure is likely to continue, especially because of high prices of steel.”

(Sourced from Bloomberg)