With the monsoon picking up after a slow start, tractor-major Escorts is expecting the industry to end the current fiscal on a high, registering a 10 per cent growth from the third quarter onwards.
“There has been a temporary slowdown in the market because of the delayed monsoon. India has had a flat tractor market over the last six to seven months. But as the situation is improving and we are seeing rains now, the water level is coming up. Now the sentiments of the farmers are up. We think that the situation will change very soon. The market should go back to normal 8 percent to 10 percent growth level from October.” Escorts Agri machinery group head (marketing) Shenu Agarwal said here on the sideline of the launch of its new models in 60-65 HP Farmtrac tractor.
The Indian tractor market, which is about 5.3 lakh units currently, saw marked improvement in period 2010 to early 2012. But, sales in both domestic and export market dipped by 3.4 per cent in the fourth quarter of 2011-12. In the first quarter of the current financial year there has been a 2.8 per cent growth for the industry.
Escorts, India's third largest tractor maker, expects the sales to get a boost from third quarter onwards, as Agarwal said, “the delayed monsoons saw people hold back their purchases.”
However, according to Agarwal, the industry may hit another speed-breaker in coming days, if there is a substantial rise in fuel prices.
“It (diesel price hike) will affect the sales of the market as a whole if the government decides to hike diesel prices or remove subsidies to some extent. However, we think that it will be a temporary slow down as the farmers will have to have the tractors, there is no alternatives. Sentimentally it will affect the farmers for sometime, but then they will start living with this,” he said.