The company's whole-time director and CFO Bharat Madan projects mid-single-digit growth in the sales volume of the tractor industry during the current financial year.
07 Nov 2024 | 11995 Views | By Kiran Murali & Yukta Mudgal
Escorts Kubota Ltd anticipates domestic tractor industry sales volumes to hit a new peak in the next financial year, on expectations of a good monsoon improving farm sentiments and stricter emission norms driving pre-buying activity.
“Next year, the tractor industry will touch a new peak with good monsoon and ...
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Escorts Kubota Ltd anticipates domestic tractor industry sales volumes to hit a new peak in the next financial year, on expectations of a good monsoon improving farm sentiments and stricter emission norms driving pre-buying activity.
“Next year, the tractor industry will touch a new peak with good monsoon and prebuying expected ahead of the new emission norms,” Bharat Madan, Escorts Kubota's Whole-time Director and Chief Financial Officer told Autocar Professional.
This year, surplus rainfall has resulted in healthy reservoir water levels. Moreover, the hike in minimum support price on crops, government spending on rural development and positive terms of trade for farmers, are expected to bode well for the tractor industry going forward.
“There is a possibility of the new emission norms to come in from April 1, 2026. If that happens, there will be a lot of pre-buying that will happen for the old emission norm tractors both by customers and the channel. This means Q3 and Q4 of next financial year will see good pre-buying,” Madan added.
The tractor industry achieved record-breaking sales in the financial year 2023, a benchmark that is yet to be surpassed. In 2022-23, the industry clocked a sales volume of 9.45 lakh units. However, the sales declined 7% in the following financial year to 8.76 lakh units.
Madan noted that the industry growth in the current financial year is likely to be in the mid-single digits despite the volume remaining almost flat at 4.72 lakh units during the first half of the year, compared with the year-ago period.
“This year, we think the industry will grow in mid-single-digit numbers. The first six months were more or less flat for the industry. But October has seen good growth and we expect the momentum to continue in the coming months,” Madan said.
Meanwhile, Mahindra & Mahindra has raised its industry sales volume growth forecast to 6-6.8% for the current financial from its earlier projection of 5%. The automaker estimates the industry to grow 13-15% during the second half of the financial year.