Mahindra & Mahindra Ltd now expects India’s tractor industry to grow faster than earlier projected, raising its annual growth forecast to 9% through fiscal 2030 from the previous 7%. Executives shared the upgraded outlook during an investor call on Thursday, citing stronger crop profitability and recent government tax cuts that are boosting demand for higher-powered tractors.
Mahindra said the upbeat outlook is driven by a 5.6% rise in profitability for cash and horticulture crops, even as the Tractor Price Index has dropped 7.1%. Additionally, recent GST changes are encouraging farmers to shift toward larger, more advanced tractors, further strengthening industry demand.
With these favorable trends, India’s installed tractor base is now projected to reach 12.2 million units by FY2030, up from the earlier estimate of 11 million. But Mahindra believes the actual requirement could be far greater. The company estimates that achieving optimal farm mechanization would need about 17 million tractors at 4 HP per hectare or up to 24 million units at a 6 HP per hectare benchmark highlighting the significant headroom for growth in the sector.
A major trend driving the market is the rapid shift toward higher-horsepower tractors. Models in the 40–50 HP segment now account for 64% of sales in FY2025, a steep rise from 49% just five years ago.
Mahindra reports that its global tractor volumes have grown 1.4 times between FY2020 and FY2025, reaching 433,000 units in the latest fiscal year. This expansion helped lift annual tractor revenue to ₹35,375 crore, with profit after tax rising to ₹3,792 crore.
Mahindra’s strategy is firmly rooted in its optimistic outlook on rural mechanization, driven by three key levers: faster overall industry growth, greater market penetration, and a sustained shift toward higher-horsepower tractors.
Globally, Mahindra continues to expand its footprint with manufacturing and distribution hubs across the U.S., Brazil, Turkey, and Japan. In North America, its share of the sub-20 HP tractor segment stood just under 10.4% in the March quarter. The company has introduced its 1100 Sub Compact and 2100 Compact series and is gearing up to launch new models, including the OJA Small and Large Utility tractors and higher-horsepower platforms. Mahindra executives estimate the North American market for sub-110 HP tractors at roughly 200,000 units.
In Brazil, Mahindra holds roughly an 8% share in the sub-120 HP tractor segment and about 20% in the sub-50 HP category. The company is preparing to introduce new high-horsepower models, the NOVO lineup, and the OJA series across international markets. Mahindra has also announced plans for a new manufacturing facility to support its expanding global ambitions.
