After hitting a historic high in domestic sales in October, tractor sales in the domestic market moderated in November. However, volumes were still higher when compared with November 2021 sales as post-festive season demand remained normal.
Last month, domestic sales grew about 7 per cent at 67,940 units when compared with 63,783 units in November 2021, but are down a whopping 45 per cent when compared with festive October 2022 volumes at 123,525 units.
M&M, Escorts top growth
Top tractor maker Mahindra & Mahindra outpaced industry growth with 12 per cent increase in its November 2022 volumes at 29,180 units. “Demand continued to remain strong in the post festival period on account of brisk sowing of rabi crops, fuelled by high moisture content in the soil. Procurement of Kharif crop has progressed well, bringing liquidity in the hands of farmers and this augurs very well for the tractor industry’s growth,” said Hemant Sikka, President – Farm Equipment Sector, Mahindra & Mahindra Ltd.
Escorts also recorded higher-than-industry growth of 13.4 per cent at 7,359 units for November 2022. “While rural sentiments continue to remain favourable owing to improved Rabi sowing assisted by good monsoon this year and better water level in reservoirs, softening in commodity prices is not happening at desired pace leaving input costs to be higher than anticipated, it said.
The total production in November 2022 was also higher at 78,709 units when compared with 67,566 units in November 2021, according to data provided by the Tractor & Mechanisation Association (TMA).
Tractor Exports from India were lower at 9884 units in November 2022 when compared with 10,790 units in November 2021. However, on a month-on-month basis, last month’s export volumes grew 11 per cent when compared with October 2022 exports of 8888 units.
For April-November 2022 period, total domestic tractor sales grew 9 per cent at 678,671 units when compared with 620,230 units in the same period the previous year, while total exports grew 5 per cent at 89,192 units when compared with 85,281 units.
“Tractor Industry volumes have remained at healthy levels in the ongoing fiscal, aided by decent farm cash flows. Domestic volumes are expected to record a single digit growth in FY23 on the back of a high base, aided by favourable underlying drivers for rural cash flows, said Rohan Kanwar Gupta, Vice President & Sector Head – Corporate Ratings, ICRA Ltd.