Mahindra & Mahindra to exit non-viable Japanese agri-machinery business; check how the stock fared on March 2

The board of Mitsubishi Mahindra Agricultural Machinery Co. Ltd (MAM), which is operating in Japan, has approved withdrawing from the agricultural machinery business, the Mumbai-based company said in a regulatory filing.

MAM has also announced that the business that supplies spare parts for its products and product warranty services would continue to operate, it added.

With respect to businesses other than continuing business, MAM plans to dissolve and proceed with liquidation procedures in accordance with the applicable law therein, it stated.

"MAM has continued to incur losses despite multiple structural measures aimed at restoring profitability. After a detailed assessment of the business' long-term viability and financial sustainability, MAM has determined that sustaining the business in a stable manner going forward would be challenging," it stated.

On completion of the liquidation procedure, the promoter group would not have to incur the annual loss as well as fund these losses, it added.

The company plans to cease the production and sale of agricultural machinery by the first half of fiscal year 2027.

MAM will proceed with the business withdrawal while giving due consideration so as to minimise the inconvenience to all stakeholders, including business partners, it stated.

Each business partner will be contacted individually in due course, it added.

"In addition, except for employees engaged in the continuing business, the company will provide maximum possible re-employment support to employees who are unavoidably required to leave as a result of this business withdrawal," it stated.

The revenue from operations of MAM for the year ended March 31, 2025, stood at ₹2,094.17 crore, and after elimination of intercompany transactions with the Mahindra Group, MAM contributed ₹1,786.03 crore, or 1.13%, to the consolidated turnover.

M&M shares settled over 2% lower at ₹3,324.80 apiece on the NSE.

About Mahindra and Mahindra (M&M)

Mahindra and Mahindra (M&M) is a multinational automobile manufacturing company. Originally established in 1945 as Mahindra & Mohammed, it was later renamed Mahindra and Mahindra.

The company’s diverse business portfolio includes automotive, farm equipment, technology services, financial services, renewable energy, logistics, hospitality, and real estate. Headquartered in Mumbai, M&M is a core unit within the Mahindra Group.

Since assembling its first vehicle in 1947, the company has grown rapidly. Today, it offers a wide range of products and solutions ranging from SUVs, pickups, commercial vehicles, and tractors to electric vehicles, two-wheelers, gensets, and construction equipment.

It started its exports in the 1960s, and currently, Mahindra and Mahindra Limited's vehicles and tractors can be found on six continents of the world.