Tractors and Farm Equipment Limited (TAFE), India’s second largest tractor maker by volumes will try to invest Rs 250 crores in the current financial year to increase its installed capacity by 50,000 tractor units at two of its manufacturing locations in India.
TAFE is planning these expansions in its facilities at Bhopal and Doddaballapur. The company said its capacity utilization across three plants (including another tractor making plant in Madurai) currently stands at 110% and its current capacity across these plants stands at 1, 58,000 tractors.
“Overall we are quite upbeat. Our factories are running at full capacities. Our capacity expansion programme is underway and one phase will happen by March and another one by September next year,” said Mallika Srinivasan CEO and Chairman of the company.
TAFE wields about 25% market share of the Indian tractor industry with a sale of over 150,000 tractors (domestic and international) annually.
The tractor industry is expected to register a growth of 10-12% in the current financial year at around 7, 85,000 – 7, 95,000 units of tractors, the highest thus far in the domestic market. In the last financial year, a record 7, 11,478 tractors were manufactured domestically.
Exports constitute up to 15% of the company’s overall sales, while the company’s ‘Massey Ferguson’ brand tractors account for a larger part of its exports.
On the company’s export growth, Mallika said “Certainly we don’t like that some of our stronger markets are not doing as well but otherwise our new products are well accepted. Growth this year should be faster than industry.”
Tractors and Farm Equipment Limited was started at 1960 in Chennai.