The Marazzo was launched in September with introductory prices starting at Rs 9,99,000 and going up to Rs 1.39 million, depending on variants.

Margins from automobiles dropped 2.7 percentage points from a year ago. The rise in raw material costs, introductory pricing for the new vehicle and higher promotional expenses were the reasons.

But the decision wasn’t an easy one. Unlike models from Tata Motors and Ashok Leyland, it didn’t have a long-running history to depend upon.

“…Demand and consumption are good stories for the country and there is no reason to have that derailed. A little inflation is like good cholesterol,” VS Parthasarathy, group CFO at Mahindra & Mahindra, said on Wednesday.

However, Goenka added that sales are expected to pick up during the October-December quarter.

The company had sold 42,207 units in the same month last year, M&M said in a statement. In the domestic market, sales were at 45,373 units last month, up 15 per cent, as compared to 39,615 units in August 2017.

Disbursement growth was also strong during the quarter, driven by high disbursement in the CV, pre-owned vehicle and tractor segments. We consider the stock attractive at 3.1x FY20E P/Adj B and maintain our ‘buy’ rating.