We depend significantly on clients operating in the automotive industry in India. Revenues from our clients operating in the automotive industry contributed 63.25%, 60.84%, 67.94% and 73.97% to our total revenue from operations in the three month period ended June 30, 2017 and in Fiscals 2017, 2016 and 2015, respectively.
For instance, certain states in India experienced below average rainfall in 2014 and 2015 which negatively impacted the rural economy. As a result, the sales of vehicles such as motorcycles, light commercial vehicles and tractors were adversely affected.
Furthermore, some of the OEMs may also perceive the Mahindra Group as a competitor and may, therefore, not work with us.
We depend on the performance of the automotive, engineering, consumer goods, pharmaceutical, e-commerce and bulk industries for our supply chain management (“SCM”) business. Similarly, we depend on the performance of the IT, ITeS and telecom industries for our people transport solutions (“PTS”) business.
The revenues from our SCM business represented 89.89%, 88.94%, 87.88% and 86.95%, respectively, of our revenue from operations in the three month period ended June 30, 2017 and in Fiscals 2017, 2016 and 2015. In those periods, revenue from our PTS business represented 10.11%, 11.06%, 12.12% and 13.05%, respectively, of our revenues from operations.
In our PTS business, our clients may choose to reimburse their employees using competing modes of public transportation or car pooling services.
Our contracts with our clients are generally time bound and contain termination provisions. Our business may be adversely affected if our contracts with our clients are not renewed within the anticipated timeframe, or at all. We may also incur losses as a result of excess capacity at our logistics facilities if contracts are not renewed as anticipated.
Further, we are typically required to provide warehousing capacity for our integrated logistics clients. In order to meet such client requirements, we lease or license properties from third parties for operating our logistics hubs, warehouses, stockyards, cross docks and other logistics facilities. We maintain or increase these logistics facilities on the basis of actual demand or our projections of future demand, which may involve uncertainties.
Written-off advances and receivables were recognized in the three month period ended June 30, 2017 and in Fiscals 2017, 2016 and 2015, respectively, which constituted 0.05%, 0.07%, 0.10% and 0.22% respectively, of our total revenue from operations.
The credit period offered by our business partners and suppliers is generally lesser than what we generally grant our clients.
