Riding on new OJA platform, M&M targets to double exports in 3 years
Mahindra & Mahindra (M&M), the market leader in the tractors segment in India, is eyeing to double its exports from India in the next three years, riding on a new platform OJA it launched in the South African city of Cape Town on Tuesday.
In 2022-23, the company exported 18,104 tractors, and it aims to double that to 36,000 by FY26, Hemant Sikka, president, farm equipment segment, M&M, told Business Standard.
With the OJA range, M&M is opening a dozen new markets. It is opening an office in Thailand and it will tap the Asean markets from there. Moreover, it is eyeing the European markets, especially vine-growing countries like Germany, Italy, and Spain. Sikka said that M&M currently has no presence in the Asean region and Europe. “OJA tractors empower Mahindra to address 25 per cent of the global tractor industry, while opening new markets like Europe and Asean,” he said.
On the slowdown in the American market, Sikka expected it to be a short-term event. In Brazil, the company has already doubled its market share from 3.5 per cent to 7.2 per cent in the past two years. “We will sell OJA in Brazil, too,” Sikka said.
The OJA platform or family will have four sub-platforms – sub-compact, compact, small utility, and large utility. For now, the sub-compact range of tractors will not be available for the Indian market, but only for exports, mostly to the US, Sikka said. He mentioned that if there is demand for the sub-compact segment, it can be launched in India.
M&M will start exporting the sub-compact range of OJA tractors in January 2024. The large utility platform, however, will come later around FY26; it will cater to both Indian and export markets.
The Mahindra OJA 27 HP tractor will be priced at Rs 5.64 lakh, while the OJA 40 HP tractor will cost Rs 7.35 lakh – priced competitively against its competition.
The OJA range shall be made at the company’s Zaheerabad plant in Telangana which has an overall annual capacity to make 100,000 tractors. “The capacity for OJA would be around 30,000 (annually) for now, and we can always ramp up capacity for this range by re-aligning production at Zaheerabad,” Sikka said.
He further said that Indian farmers are changing: From marginal farmers looking for multi-utility tractors which are also used for haulage to more affluent farmers focusing on horticulture.
Sikka said the CAGR for the tractors industry has been around 7 per cent for several years, and in comparison the horticulture segment tractors are growing at a double-digit rate. The segment size for these light-weight specialised horticulture tractors is around 50,000 units a year, and M&M enjoys a 30 per cent share of the market. This is lower than its overall market share in tractors which is around 42.6 per cent.
M&M tried its hand at a small tractor earlier, too, with the Jivo range in 2018. But Jivo was also a multi-utility tractor. The OJA would be a specialised tractor family having applications in horticulture and also in paddy cultivation. On Tuesday, M&M launched three OJA products ranging from 700 kg to 2000 kg, and from 20 horsepower to 40 horsepower. Paddy farming needs water and heavy tractors tend to sink in paddy fields, Sikka explained.