FARM The tractor industry forms the backbone of India’s rural economy, driving transformation in agriculture, a sector that sustains nearly half of the nation’s workforce. By enabling farm mechanisation and boosting productivity, it fuels rural prosperity, catalyses consumption, and plays a central role in powering India’s GDP growth. For India to achieve self-sufficiency in foodgrains, the tractor population in India must grow from the current 8.4 Mn to 17 Mn by 2030. After a relatively subdued FY24, the Indian tractor industry witnessed a turnaround in FY25 driven by favourable weather conditions, positive terms of trade for farmers and various government initiatives. For our Farm business, FY25 was a significant year with robust volume growth and operational excellence. Mahindra consolidated its over four-decade long market leadership, with its core brands Mahindra and Swaraj, and remained the world’s largest tractor manufacturer by volume. We are further strengthening our market presence through product innovation, enhanced financing and superior service, along with a sharp focus on supply chain optimisation. Given the continued concerns over labour shortage, mechanisation remains a pivotal driver of farm productivity. Our Farm Machinery business is positioned to play a significant role in India’s farm mechanisation journey. This business crossed the Rs. 1,000 crores revenue milestone during FY25, leveraging a strong ‘Made in India’ portfolio. Strategic Imperatives The Farm segment at Mahindra aims to deliver substantial scale through focused strategic actions: • Product Launches and Channel Expansion to strengthen our domestic market position, while maintaining gold-standard profitability. • Quantum growth in Farm Machinery by investing in product development, quality, driving channel efficiency and brand building, as well as leveraging partnerships to boost capabilities. • Growing International Business focusing on key markets including the United States, Brazil, Thailand and Turkey and leveraging Centers of Excellence in Turkey. • Pioneering Technology Leadership By investing in cutting-edge technologies and fostering strategic partnerships, we seek to maintain our leadership in farm technology and introduce innovative solutions to the market. Key Highlights • New product launches: The OJA series and Target have successfully addressed the white space of lightweight small tractors with tremendous ramp-up post their launch in FY24. • Global farm business: Tractor exports reported a growth of 27% YoY, led by OJA’s success in North America and the opening of new markets in Africa and ASEAN. While exports were strong, our overall Farm International results were weighed down by weak markets in the US, Europe and Japan. In FY25, we sharpened focus in some geographies by pivoting the way we operate in these markets. As a result, we took some impairment charges in Q4 which are reflected in our full year results. • Technology leadership and innovation mindset, with a significant number of telematics kits deployed and 3 lakh+ acres of sugarcane harvested through AI based precision farming. • Achieved RoCE at 53.7% for FY25. Achievements in FY25 43.3% Highest-ever market share and remained the market leader for the 42nd consecutive year. 19.7% Core tractor, EBIT margins, up 200 bps. Tractors including exports and excluding Powerol, farm machinery ₹1,024 Cr. Farm machinery achieved highest ever revenue, up 18% Integrated Annual Report 2024-25 | 22
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