Hemant Sikka, president-farm equipment sector at Mahindra & Mahindra (M&M), in an interview with CNBC-TV18, said the company will continue to strive for higher-margin in the tractor business.
“We have always maintained our long-term guidance; one quarter up because everything came together, commodities were benign and because of that, we were able to hit the margin. I think 22 percent is a very good performance on the financial front by Mahindra and we will continue to strive for higher margins,” said Sikka.
On commodity inflation, he said, “It’s a reality and we have decided that we are not going to pass on all the commodity increases in one go. I think it’s not good for the industry. We have to look after our customers and make sure they feel confident buying new tractors. Therefore, we have gone for a phased increase in passing on the pricing. We took a price increase in January, April and we are planning to take price increase in next few weeks gain.”
“If we are able to control COVID-19 well, I see no reason why rural income will not rise, why farmers’ cash flow will not improve, why tractor sales will not improve – there is no reason. All agri parameters continue to stay very positive,” he said.
For the entire management interview, watch the video