Mahindra & Mahindra’s (M&M) farm equipment sector continues to experience robust growth, with tractor sales maintaining double-digit expansion for the third consecutive month.
The company expects this positive momentum to extend into the final quarter of FY25, with industry-wide growth projected at around 6.5-7%.
In February, M&M recorded a 19% sales increase, significantly outperforming the industry’s 13.6% growth.
The company attributes this success to favorable agricultural conditions, including a strong kharif harvest, steady crop prices, and healthy reservoir levels.
Back-to-back good harvests, combined with government support through higher minimum support prices (MSP), have created an environment conducive to increased tractor demand.
Market Share And Growth Trends
As of February 2025, M&M’s year-to-date market share stands at 43.6%, reflecting a 1.7% gain over the previous year.
The company remains optimistic about maintaining its strong performance, with fourth-quarter growth projected at 15%.
Since M&M has been gaining market share, its growth is expected to outpace the overall industry.
Looking ahead to FY26, the company remains cautious, stating that monsoon forecasts from the Australian Weather Bureau and the Indian Meteorological Department in April will provide better insights into future industry trends.
The agriculture sector has shown resilience, with multiple factors driving demand.
A strong kharif harvest and monsoon rainfall at 108% of the long-period average have boosted agricultural output. Reservoir levels are at a 10-year high, supporting the ongoing rabi crop.
Additionally, the government’s increase in MSP for key crops has further strengthened market conditions.
Favorable trade terms for farmers, with reduced input inflation and stable crop prices, have also played a crucial role in sustaining demand.
Future Outlook And International Presence
The tractor segment currently contributes about 22-23% of M&M’s total revenue.
While the company has no specific targets for increasing this share, it aims for consistent growth across its farm and auto businesses.
M&M also has a strong presence in the US, its second-largest market outside India.
With two large tractor manufacturing plants in Houston and Pontiac, the company meets the ‘Make in America’ criteria.
So far, recent tariff announcements have not impacted its US operations.
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