Encouraged by the continuing momentum in sales, the tractor industry hopes to end the current fiscal with highest-ever domestic volumes close to 6.8 lakh units.

The industry’s previous highest domestic number was in 2013-14 when domestic sales stood at 6.34 lakh units.

Tractor companies and industry analysts project a growth rate of 17-18 per cent for the current fiscal. During the last fiscal, the industry registered domestic sales of 5.8 lakh units.

Tractor makers have said that while the industry’s Q3 performance was better than expected, the sales momentum continued in January, and hence, they expect Q4 to be equally good. Leading players such as Mahindra & Mahindra, Escorts and Sonalika Tractors reported more than 40 per cent growth in their January domestic volumes.

During the first 10-month period of this fiscal, the domestic tractor volumes are reported to have grown by about 18 per cent. During this period, Mahindra and Escorts reported a growth of 18 per cent and 17.5 per cent, respectively.

“In Q3, the tractor industry has performed better than what we had expected. When we started the quarter, we were thinking that it will be flat to may be just marginally positive. But, the industry ended with 8 per cent growth. This is obviously on the basis of very good production of kharif crop, positive sentiment in rural area and government’s thrust in agricultural and rural segments,” according to Pawan Goenka, Managing Director, Mahindra & Mahindra.

“January has seen a 38 per cent increase (domestic and export) and the industry growth will be between 15 per cent and 18 per cent in Q4. This year we expect the industry to end with highest-ever volume,” he said.

Escorts expects domestic tractor volumes to touch 6.80 lakh units in the current fiscal.

T Karthikeyan, Senior Analyst – Corporates, India Ratings & Research, said domestic tractor sales grew by 17 per cent at 6.59 lakh units during April 2017-January 2018 and the growth was on account of two consecutive years of normal-to-good monsoons, improved crop production, easy availability of credit to farmers and increasing use of tractors in non-agricultural sectors.

Rating agency Crisil has projected that the tractor industry will achieve domestic sales of 6.5 lakh units in FY-18 and attributed the volume boom to the prospects of a successive normal monsoon, declining interest rates and farm loan waivers by States.

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