Escorts, one of the leading players in the agri-machinery segment, is planning to shift gears towards the high-end value market in tractor segment.
The company is currently the third top player in the tractor segment after Mahindra and Massey Ferguson.
“We sell about 63,000 tractors a year and most of them have been in about 45 horse power (HP) category. With this, we are the third top company in the market and have a 12% market share. However, we are a distant number three compared to the second player. We are now working on a strategy to move into the value-based segment from the volume driven activity,” S Sridhar, chief executive officer, Escorts Agri Machinery, said.
The company has a unit near Faridabad with a capacity to make about one lakh tractors a year though it has been utilising about two-thirds of the capacity and recording about Rs 3,000 crore in revenue. “We are eyeing the 50 HP and above capacity market where there is real value. We want to be the top player in this segment in the next two to three years.
There is a high potential for these tractors in several parts of the country and we are already testing some of the products designed for this sector,” he said.
About 5.25 lakh tractors are sold every year in the country and about 15% of these are of 50 HP and above capacity. Escorts expects this share to rise up to 23% in the next seven years. In order to cater to the demand in the segment, the company is focusing on markets like Andhra Pradesh which use the high-end tractors for paddy cultivation. The puddlers that are deployed in paddy fields to prepare the field for sowing are high-capacity tractors allowing the farmers to use the machines to perform in slush.