Domestic tractor demand to remain robust in fiscal 2021; exports expected to remain flat
Domestic tractor demand is expected to rise by 18-20% in FY21 due to positive farm sentiments on account of better crop profitability, high government support through income support schemes, higher procurement of field crops and higher rural expenditure (agriculture expenditure estimated to be higher by ~52% on-year in H1FY21).
Tractor demand is expected to marginally improve at 1-6% in FY22 on account of healthy reservoir level, higher rabi realisation and expected pick up in commercial demand especially for eastern states.
Domestic sales fell by ~10% in fiscal 2020 after three years of robust growth where the industry grew by 19%, 22% and 8% in FY17, FY18 and FY19 respectively. Sales fell in fiscal 2020 owing to poor commercial demand and uneven rainfall spread.
