The automaker also said with better availability of semiconductors, it hopes to maintain volume growth momentum from the third quarter onwards.
While the industry has seen a strong recovery in demand for passenger vehicles in the past two quarters, with chip shortages hurting carmakers globally, companies have scrambled to make up for the production hit.
"Q2 was the worst of the chip shortage that we have seen... the shortage cut across the company's entire portfolio," said Rajesh Jejurikar, executive director at Mahindra.
Chaired by billionaire Anand Mahindra, the company said it faced a production loss of 32,000 vehicles in the second quarter due to the shortage, yet managed to record 9% growth in sales.
Jejurikar said the company was continuously adjusting production plans as per availability of chips, and expects the crunch in 2022 will not be as acute as 2021.
In a post earnings call, Jejurikar said that by 2027, Mahindra plans to launch 13 new sport-utility vehicles and expects electric vehicles to comprise about 20% of its volumes in India.
The company is open to raising money from investors for its EV business and could consider carving it out as a separate unit, Mahindra's managing director Anish Shah said.
"It is not just for capital but also expertise... that will help us grow faster. We see EVs being a major play for us going forward," Shah added.
For the reported quarter, consolidated net profit jumped to 19.29 billion rupees($260.01 million) from 1.36 billion rupees a year ago, when it had booked a one-time charge.
The company's shares rose 5.24% to 904.50 rupees at market close.
($1 = 74.1900 Indian rupees)
(Reporting by Shivani Singh in Bengaluru and Aditi Shah in New Delhi; Editing by Shailesh Kuber)
By Shivani Singh and Aditi Shah
