producing power packs and manufacture electronic as well as drivetrain components for electric 3-wheelers and 4-wheelers. We expect these steps in augmenting capacity to cater to the robust demand growth in domestic and international markets. In partnership with our key suppliers, we are leveraging digitisation to insulate our operations from supply chain volatility. OUTLOOK - AUTOMOTIVE AND FARM SECTORS Both the Automotive and Farm Sectors strive to sustain profitable growth, maintain leadership position in the domestic market and at the same time, explore global opportunities for growth. Simultaneously, your Company continues its focus on achieving cost leadership through focussed cost optimisation, productivity improvements, value engineering, supply chain management, and exploiting synergies between various group businesses. AUTOMOTIVE BUSINESS While the long-term outlook for the Indian Auto Industry is promising, the industry took four years to pre-COVID levels in commercial vehicles, three-wheelers and two-wheelers. Passenger vehicles which had already recovered to pre-COVID levels last year, crossed the 4.2 million mark in FY 2023-24. A normal monsoon is important for both agriculture as well as the rural economy at large. The tractor business in particular and the automotive business to some degree, run the risk of a drop in demand, in case of a significant variation in the monsoon. In addition, an untimely monsoon and uneven spread has the potential of adversely impacting the business. MONSOON Ÿ Indian Meteorological Department (IMD) in its long range forecast, predicted seasonal rainfall (June to September, 2024) to be 'Above Normal' i.e., at 106% of the Long Period Average (LPA). Skymet's prediction was slightly lower at 102% of LPA. La Nina conditions are expected to develop in the later half of monsoon season. Ÿ The spatial distribution suggests that above-normal seasonal rainfall is very likely over most parts of the country except some areas over East and Northeast India, where below-normal rainfall is likely. Ÿ Early onset of monsoon and IMD's affirmation of above-normal rainfall is expected to boost rural sentiments. POTENTIAL LA-NINA IMPACT Indian industry could have issues related to lower supplies of components due to supply chain blockages prompted by the ongoing Russia-Ukraine war and crisis in the Middle East. This could lead to a rise in domestic fuel prices. ONGOING REGIONAL CONFLICTS As per the Automotive Mission Plan 2026 (AMP 2026), the mid to long-term outlook for the Indian auto industry is positive. Hon'ble Prime Minister unveiled Indian Auto Industry Vision @ 2047 mentioning Auto Industry is the engine of economic growth. 159 MANAGEMENT DISCUSSION AND ANALYSIS
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