M&M Sees its SUV Sales up by Double Digits in FY26, Tractor Industry Growth in High Single Digits

Mahindra & Mahindra Ltd, India’s leading sport utility vehicle and tractor manufacturer, has forecast strong growth in the financial year 2025-26, expecting its SUV sales to rise by double digits and the domestic tractor industry to expand by high single digits. The company attributed this optimistic outlook to a confluence of macroeconomic factors, including government spending, infrastructure development, repo rate cuts, income tax relief, and the forecast of an above-normal monsoon.

“We continue to stay positive given our product portfolio and we will look at mid-to-high teens for SUVs in F26, that includes electric vehicles,” said Rajesh Jejurikar, Executive Director and CEO, Auto and Farm Sectors, during a press conference held to discuss the company’s financial performance for FY25.

The company acknowledged ongoing urban demand stress, but said it expects a recovery in the second half of the fiscal year. “There is no doubt the urban economy is tighter right now,” Jejurikar said. “But there are several enabling factors that are expected to kick in—government spending, infrastructure projects, income tax benefits, and lower interest rates. All of this should enable a positive urban turnaround in the second half of the year,” he said.

Anish Shah, Group CEO and Managing Director, echoed the sentiment: “On balance, I would say there is positivity. The recent actions around liquidity and interest rate reductions are expected to drive greater demand. So I personally don’t see much of an urban slowdown at this time—maybe a little bit of a blip, but one that should recover quickly,” he said.

In FY25, the company’s automotive dispatches grew 14% on year to 941,115 units. Its revenue from the segment reached Rs 90,825 crore, up 19% from Rs 76,156 crore in FY24. The segment's profit after accounting for joint ventures and associates stood at Rs 7,797 crore for FY25, showing strong growth of 29%.

On the financials of the electric SUV business, M&M’s management said the business was EBITDA positive without the production linked incentive benefit. And it will take a few quarters, possibly a year and a half to get to a positive EBITDA margin. M&M commenced sales of its born electric SUVs, BE 6 XEV 9e, in the last quarter of FY25. It has so far delivered 6,300 vehicles.

Tractors and LCVs

On the rural demand front, the company observed a rebound in tractor sales, but noted that the light commercial vehicle (LCV) segment—particularly those under 3.5 tonnes—has yet to show signs of recovery.

“There are many enabling factors in the rural economy, as we are seeing in the tractor sales rebound. But we haven’t seen that in LCVs yet,” Jejurikar said. The company has projected high single-digit growth in sales of the less than 3.5 tonnes LCVs in FY26.
 
The company’s forecast for the domestic tractor industry stands at high single-digit growth for the year, though executives said they would reassess after the monsoon season.

In North America, however, Mahindra expects continued weakness in the tractor industry, which contracted 13% in FY25 after three years of growth. That said, the company is optimistic due to market share gains driven by its new OJA series.

“With the launch of the OJA series, especially in the sub-20 horsepower category, our retail market share in the last four months has risen from under 3% to over 10%,” Jejurikar said.