Mahindra Farm Equipment Raises Growth Outlook for FY25, Aiming for 16% Tractor Market Growth in H2

Key Highlights

• Mahindra raises FY25 growth forecast to 6-6.8% from 5%.
• Tractor market share remains strong at 42.5%.
• Farm machinery revenue rises 14%, reaching INR 253 crore.
• Exploring alternative fuels like CNG, CBG, and LNG for tractors.
• Expects 15-16% tractor industry growth in H2 FY25.

Mahindra Farm Equipment, a division of Mahindra and Mahindra, has increased its growth forecast for the fiscal year 2025 to 6-6.8%, up from its previous estimate of 5%. The company, which holds a 42.5% market share in the tractor industry, experienced flat growth during the first half of FY25. However, it saw a 14% rise in its farm machinery revenue, which reached INR 253 crore, indicating strong domestic performance despite global challenges.

Also Read: Mahindra Tractor October 2024 Sales Report: 65,453 Units, 30% Growth

Focus on Electric Passenger Vehicles, Not Tractors

In an exciting development, Mahindra Tractors is planning to launch electric passenger vehicles in the near future. However, the company has no plans to electrify its tractors at this time. Rajesh Jejurikar, Executive Director and CEO, revealed that Mahindra is exploring alternative fuel options, such as CNG, CBG, and LNG, for its tractors instead of electric power. While the company has showcased several prototypes, it does not plan to commercialize these alternatives anytime soon.

Looking Ahead: 16% Tractor Industry Growth in H2 FY25

Mahindra expects the tractor industry to grow by 15-16% in the second half of FY25. This optimistic outlook is driven by a favorable monsoon season, better kharif crop output, and continued government support for the agriculture sector.

"In Q2 FY25, we gained market share across both our Auto and Tractor businesses. Our SUV sales grew by 18% year-on-year, helping us maintain leadership in revenue market share," said Jejurikar.

Also Read: Mahindra Tractors Launches Virtual Tractor Drive Experience with AI-Powered Personalization to Celebrate 60th Anniversary

Mahindra & Mahindra Maintains Strong Market Position

Despite facing internal challenges, such as inflation in Turkey and a decline in the US market, Mahindra & Mahindra (M&M) maintained a strong market presence with a 41.6% share in the first half of FY25. This was slightly up from the 41.2% market share in H1 FY2024. The tractor industry saw stable sales, with 4.72 lakh units sold, compared to 4.69 lakh units in the same period last year.

In addition to its strong position in India, M&M continues to expand internationally. The company is part of Mitsubishi Mahindra Agri Machinery and owns Sampo Rosenlew in Finland and Erkunt Tractors in Turkey.

Also Read: Sonalika Tractors Achieves Record Sales with 20,056 Tractors Sold in October 2024

CMV360 Says

Mahindra Farm Equipment has raised its FY25 growth forecast to 6-6.8%, with strong expectations for the tractor market in the second half of the year. Despite global challenges, the company continues to maintain its dominant market share. By focusing on alternative fuels and expanding its product lineup, Mahindra is positioning itself for continued growth in the coming months.