Pune: Adverse economic conditions following demonetisation, introduction of Goods and Services Tax (GST) and issues around the farmers’ loan waiver in various states have failed to hamper the top gear growth that the tractor industry is witnessing this year. After a depression for two years, the industry started picking up again in the Financial Year 2016-17 and has continued to grow ever since.
While speaking at the inaugural session of the Golden Jubilee Year Celebrations of the Institute of Company Secretaries of India (ICSI) last week, Prime Minister Narendra Modi stated that the country has seen over 34 per cent increase in the sale of tractors in recent months.
Speaking on the performance of the sector, Executive Director of city-based Sonalika International Tractors Ltd, Raman Mittal, said, “After two years of depression, the tractor industry bounced back impressively last year. The tractor industry has been clocking top gear growth for the past two years. The tractor industry has registered a growth of nearly 13 per cent during April-August FY 17-18 and May-end FY 17-18, with a volume growth of 10-11 pc according to ICRA.”
Highlighting the performance of the company, he said, “We are very focused that our tractors should increase the farmers income. As a result, we have also witnessed consistent growth by growing 18 per cent in FY 16-17. We grew by 18.5 per cent in first quarter, 31 per cent in August 2017 and 51.4 per cent in September 2017 in the domestic market. The company has also set a record by selling 50,002 tractors, its highest ever in the first half of a financial year.”
According to Mittal, this growth is expected to continue this year as well, thanks to the good monsoon in most parts of the country. “All external factors such as monsoon, GST implementation and government measures to boost the agricultural economy are very much in favour of the industry. Government policies and initiatives have given a boost to the industry and we believe that GST will have a positive impact on tractor industry in due course of time. Farmers in the country will be more inclined towards farm mechanisation leading to growth in tractor sales,” he added.
Speaking about his expectations for the next half of the year, Mittal added, “Overall industry is expected to grow as farmers’ sentiments are quite positive. Also, Q2 is a major quarter for any industry due to festivals. We are positive that with our technologically advanced robust products, Sonalika ITL’s growth journey will continue faster than the industry average,” he said.