Despite a 14% fall in tractor sales, India’s biggest utility vehicle manufacturer Mahindra & Mahindra, driven by strong SUV sales, beat street expectations with a 22% year-on-year growth at Rs. 902 crore for the  quarter ended September.

SUV sales grew by a third during the quarter. The net revenue rose 31% at Rs. 10,787 crore.

The Anand Mahindra-led M&M’s stock price rose 3.6% at Rs. 857.55 on the BSE on Thursday, when the Sensex ended flat.

The company sold 62,751 utility vehicles, holding a market share of 45.4%. In tractor business, another stronghold of M&M, it has 40.3% market share with 47,065 units sold in the quarter. The erractic monsoon rains affected tractor sales, while growing customer interest in utility vehicles ensured a steady growth in the passenger vehicle business.

“Despite sales volume of tractors - its larger component of business - sharply fell, M&M maintained good margins, which is a positive,” said Rikesh Parikh, vice-president, markets strategy and equities, Motilal Oswal Securities.

The sale of its entry-level sedan Verito has revived, clocking 4,899 units in the quarter. M&M’s vehicle export grew 43% at 10,349 units.Mahindra added compact SUV Quanto to its portfolio towards the end of the last quarter and launched Rexton from its subsidiary Ssangyong in the premium category early this month.

M&M said “the risks facing the economy over the shorter term, emanating from the possibility of a meltdown in the euro zone and escalating tensions in the middle east, remain high.”