Landmark Cars · Material risks, their source context, and severity in the latest available quarter.
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Analyst flagged that Mercedes-Benz, contributing ~40% of revenue, has lost volume market share in India. Management acknowledged the trend but attributed it to global strategy prioritizing value over volumes, with 12 new model launches planned to address gaps.
Management admitted newer brands (contributing 20% of revenue) are clearly not as profitable as mature brands—some have turned profitable, others are still ramping. Analyst questioned blended group ROC post-stabilization, which management deferred to a separate discussion.
Despite guidance for 100bps improvement in H2, gross margin remained flat YoY at ~16.4%. Management attributed this to sales mix (lower-margin new car sales outpacing after-sales) and noted mathematical improvement requires after-sales contribution to rise meaningfully. Analyst pressed on this gap between guidance and execution.
Analyst raised concern that customers may postpone purchases of European CKD vehicles awaiting FTA implementation and lower CBU prices. Management countered that 92% of Mercedes sales are CKD where duty changes are minimal, though acknowledged the FTA opens new avenues for VW, Jeep, and Renault to import previously unavailable models at lower duties.
