The hospitality chain, which runs the 'Club Mahindra' brand of resorts, said its consolidated net profit fell to 213.4 million rupees ($2.57 million) for the quarter ended Sept. 30, from 408.6 million rupees a year earlier.
Its European segment - called Holiday Club Resorts Oy (HCR), comprising nearly half of the topline - reported a loss before tax of 23.1 million rupees, compared with a profit of 10.2 million rupees a year earlier.
This compares to a loss before tax of 365.2 million rupees in its European operations in the first quarter.
The European business took a hit during the September-quarter as people cut back on leisure travel amid rising costs of living and higher inflation.
Total expenditure jumped 10.7%, which outpaced a 9.5% rise in revenue to 6.55 billion rupees. The company also flagged a one-off expense of 68 million rupees.
Additionally, heavy rains and landslides in the states of Himachal Pradesh and Uttarakhand affected resort occupancy, which fell to 77% from 79% a year ago, the company said.
Shares of the hospitality firm fell as much as 10.8% after the results. The stock advanced 32% in the September-quarter.
($1 = 83.1380 Indian rupees)
(Reporting by Anisha Ajith in Bengaluru; Editing by Sonia Cheema)