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Mahindra Exits Japan Agri-Machinery Biz, Ends Loss-Making Venture

Mahindra & Mahindra has announced its Japan-based associate, Mitsubishi Mahindra Agricultural Machinery, will withdraw from its agricultural machinery business. The decision follows sustained losses despite restructuring efforts, with operations to be wound down in a phased manner by the first half of fiscal 2027. The company will continue its spare parts and warranty services while liquidating the main business. The move aims to stop annual losses and will include re-employment support for affected employees.

Key Points: Mahindra Exits Japan Agri-Machinery Business

  • Phased exit by FY27
  • Spare parts business to continue
  • Reported Rs 227 crore loss in FY25
  • Aims to minimise stakeholder inconvenience
  • Contributed ~1% to M&M turnover
2 min read

Mahindra rationalises global portfolio; exits non-viable Japan agri-machinery business

Mahindra & Mahindra's Japan associate to cease operations, liquidate after sustained losses. Spare parts and warranty services to continue.

Mahindra rationalises global portfolio; exits non-viable Japan agri-machinery business
"MAM has continued to incur losses despite multiple structural measures aimed at restoring profitability. - M&M Regulatory Filing"

New Delhi, March 2

Mahindra & Mahindra Limited on Monday informed the stock exchanges that its Japan-based associate, Mitsubishi Mahindra Agricultural Machinery Co., Ltd., has approved withdrawal from its agricultural machinery business.

The decision was approved by MAM's board on March 2, 2026. The withdrawal will cover research and development, production, and domestic as well as overseas sales of agricultural machinery. The company plans to cease production and sales in a phased manner by the first half of fiscal year 2027.

However, MAM said it will continue its spare parts supply business and product warranty services for existing customers.

"With respect to businesses other than the continuing business, MAM plans to dissolve and proceed with liquidation procedures in accordance with the applicable law," M&M said in its regulatory filing.

Explaining the rationale, the company said MAM has continued to incur losses despite multiple structural measures aimed at restoring profitability. After assessing the long-term viability and financial sustainability of the business, it concluded that sustaining operations in a stable manner would be challenging going forward.

As per disclosures, MAM reported revenue from operations of Rs 2,094 crore for the year ended March 31, 2025. After elimination of intercompany transactions with the Mahindra Group, it contributed Rs 1,786 crore, or 1.13 per cent, to the consolidated turnover of M&M.

MAM's net worth stood at Rs 17.74 crore as on March 31, 2025. After intercompany adjustments, it contributed Rs 11.83 crore, or 0.02 per cent, to the consolidated net worth of the company, excluding non-controlling interest.

The associate reported a loss after tax of Rs 227.42 crore for FY25. After adjustments, it contributed Rs 151.61 crore, or 1.17 per cent, to the consolidated profit after tax of M&M, excluding non-controlling interest.

On completion of the liquidation procedure, the promoter group would not be required to incur annual losses or fund the business further.

The company added that it will proceed with the withdrawal while giving due consideration to minimise inconvenience to stakeholders, including business partners, who will be contacted individually. Employees not engaged in the continuing business will be provided maximum possible re-employment support.

- ANI

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Reader Comments

P
Priya S
It's sad to see an international venture close, but the numbers speak for themselves. A loss of over ₹227 crore is huge! Prudent financial management is key. Kudos to M&M for taking a clear-headed call.
R
Rohit P
This is smart portfolio rationalisation. Why keep pumping money into a business that's not viable? They're protecting the larger group. Indian companies need to be ruthless in global markets to survive. 💪
M
Meera T
While I understand the business logic, I hope Mahindra ensures they handle the exit with maximum empathy. "Re-employment support" for employees sounds vague. They should have a concrete, generous severance and retraining plan.
S
Sarah B
Interesting move. The Japanese agri-machinery market is notoriously competitive and saturated. Perhaps Mahindra's strength lies elsewhere. Focusing on markets like India and Africa for farm equipment might yield better returns.
K
Karthik V
Good to see they will continue spare parts and warranty. That's responsible. Customer trust is important, even when winding down. Hope this decision frees up capital for their electric vehicle push!

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