Erratic monsoon may halt tractor stocks' rally in near-term: Analysts

Analysts believe the on-going rally across tractor stocks may face headwinds from spatial distribution of monsoon across the country, which could keep sentiments in check

Shares of tractor manufacturers have displayed a resilient show in the past one month as a turnaround in kharif sowing, and improvement in earnings before interest, tax, depreciation, and amortisation (Ebitda) margins during the June-ended quarter (Q1-FY24) aided sentiment.

At the bourses, related-stocks like Mahindra and Mahindra (M&M), Escorts Kubota, and VST Tillers jumped up to 17 per cent in the past month, as against 1.3 per cent fall in the S&P BSE Sensex, ACE Equity data show.

According to Mumuksh Mandlesha, research analyst at Anand Rathi Institutional Equities, the run-up comes on the back of the recovery in cumulative