After a flat first half for the domestic tractor industry in the current financial year, Mahindra & Mahindra anticipates double-digit growth in the industry volume during the second half. The automaker now has revised its guidance for full-year tractor industry growth upwards to 6-6.8%.
"5% growth is what we have said last time. Now we are increasing 5% for the full year to 6-6.8%," M&M’s Executive Director and CEO for the Auto and Farm Sector Rajesh Jejurikar told reporters on Thursday after announcing the company’s second-quarter results.
The revision comes as the management sees green shots in the tractor industry on the back of surplus rainfall, reservoir level, growth in kharif output, hike in minimum support price of key rabi crops such as wheat and mustard, government spending on rural development and positive terms of trade for farmers.
“We are seeing some really good revival of the rural economy…For the second half of the year, we expect the industry to grow between 13-15%,” Jejurikar noted.
During the first half of the financial year, the tractor industry volume remained almost flat at 4.72 lakh units. The industry sold 4.69 lakh units in the year-ago period.
After hitting a peak volume of 9.45 lakh units in 2022-23, tractor industry volume had declined 7% to 8.76 lakh units in the previous financial year. The weakness in last year’s volume came from a high base and uneven monsoon.
Mahindra & Mahindra Ltd remains the largest tractor maker in India with its Mahindra & Swaraj brands. Both have a combined market share of 42.5% in the domestic market.