BENGALURU, Apr 25 (Reuters) - Indian automotive components supplier Mahindra CIE Automotive Ltd posted a nearly 73% rise in first-quarter profit on Tuesday, driven by strong domestic and European demand.

A subsidiary of Spain's CIE Automotive, Mahindra CIE's consolidated profit was INR2.79 billion ($34.06 million) in the quarter ended March 31, up from INR1.61 billion a year ago.

Lower raw material costs and pent-up demand boosted the Indian auto industry's sales during the year. Pre-purchase of vehicles ahead of the coming into force of new emission norms from April 1 and strong demand during the festival season also boosted sales.

The Mumbai-based company's European business outperformed Indian business by 5.8%. Europe, a key market for the company, posted revenues of Rs. 15.53 billion in the quarter, accounting for nearly 51.4% of total revenues.

The automaker, which counts Maruti, Tata-Jaguar Land Rover (JLR) and Renault among its customers, posted revenues of Rs. 24.4 billion in the first quarter, up from Rs. 20.61 billion a year earlier, while expenses rose 16.7%.

Meanwhile, Mahindra & Mahindra, Mahindra CIE's second-largest shareholder, last month sold more than 6% of Mahindra CIE Automotive, bringing its stake in the company from 9.25% to 3.19%.

Mahindra CIE shares are up 4.3% in 2023, compared to a 3.2% drop in the Nifty 500 index. The stock closed the day down 1.4% pending the results.

(1 U.S. dollar = 81.9200 Indian rupees)

(Reporting by Yagnoseni Das in Bengaluru; edited in Spanish by Benjamín Mejías Valencia)