India's largest tractor maker Mahindra & Mahindra is putting together plans to set up a new plant to exclusively manufacture different farm equipment, both in the pre-harvest and post-harvest segments.
Till the project is finalised, the company may expand its present alliance with Mitsubishi in order to source new farm equipment from the Japanese firm for the domestic market, sources said.
Since last year, the Indian firm has been sourcing rice-transplanters from Mitsubishi and selling them under its brand in the domestic market, after severing its relationship with Korean firm TYM a few years earlier.
This is part of M&M's initiatives to switch to a higher gear its plans to expand its offerings in the mechanised farm equipment sector, such as tiller, sprayer, transplanter and crop-specific combined harvesters. The market for such equipment has been growing at a fast clip, given the labour shortage problem that confronts the Indian agriculture sector today.
“We may consider setting up a new plant, probably in Punjab, for manufacture of modern farm equipment. Till then we will source these equipment from overseas for the domestic market. We intend to become a one-stop-solution for the entire pre- and post-harvesting operations,” Mr Bishwambhar Mishra, Chief Executive, (Tractor & Mechanisation), Farm Equipment Division, told Business Line .
Apart from cementing its tie-up with Mitsubishi, the automotive-to-aviation conglomerate is also working on its own farm products. “We are in the process of designing crop-specific farm implements. We are working on a product for sugarcane harvesting, apart from a low-cost alternative for potato harvesting. For low and medium technology products, we will largely depend on our in-house designing, while for the high-end products we will take the sourcing route,” Mr Mishra said.
New tractor roll-out
M&M, which recently launched its new 40-50 HP tractor through its Swaraj division, is now hastening its roll-out across the southern States. “This product is specially designed for the southern market, where tractors above the 35 HP category are mostly used,” he said.
This category of tractors has a nearly 20 per cent share in the overall tractor market in India, which is expected to swell from 4.80 lakh units last fiscal to about 5.30 lakh units this fiscal.
“To focus on this segment, we have also decided to use 20 per cent of the capacity of our up-coming Zaheerabad plant in Andhra Pradesh to produce Swaraj tractors for the southern market,” Mr Mishra said.
The AP plant, with a capacity of one lakh units annually, is expected to go on stream by July next year. Currently, it is using its Nagpur facility to feed the southern market, which accounts for about 40 per cent of M&M's tractor sales.