Despite a robust growth in exports in the first six months of this fiscal, Mahindra and Mahindra may face hurdles in sustaining the momentum going forward.

Exports jumped 32 per cent year-on-year and formed 7.75 per cent of the total volumes in April-October period.

On the sidelines of the launch of the new variant of the New Age XUV500, Pravin Shah, President & Chief Executive (Automotive), Mahindra and Mahindra, expressed caution on the demand in the export market.

Free trade agreements

He said that other exporting countries like Japan, Korea and some European countries are gaining due to long-term free trade agreements signed between the two countries unlike India.

Additionally, falling commodity prices and higher currency depreciation of other exporting countries act as hurdles. “The way the rupee has stabilised after depreciating to 65-66, same thing has happened in other countries as well. So it is a double aged sword,” he said.

Top export markets

Africa and South America are the top export markets for M&M’s automotive division.

The company is already facing challenges in the Indian market for all its automobile products like tractors, utility vehicles and two-wheelers due to slowdown in the rural economy and challenging business environment.

From April to October, the auto maker saw 1 per cent decline in unit sales compared to the same period last year. However, in October it saw a 20 per cent increase in units sold. Tractor sales was down 19 per cent in terms of units sold in the first six months of the current fiscal.