M&M lifts tractor outlook to double digits on GST and festival demand

Mahindra & Mahindra has raised its growth outlook for the tractor business to a robust 10-12%, up from 5-7% earlier in the year, as the company reports a strong Q2 performance. In the quarter, the core tractor business posted a very strong PAT growth of over 50%, helping lift overall profitability in the auto-and-farm division.

Management highlighted several enabling factors behind the improved outlook: favorable monsoon rains and healthy reservoir levels, increased government rural spending, resilient exports of farm produce, and a recent GST cut that is aiding rural demand. These tailwinds have given the company confidence to lift its industry outlook for tractors even as other segments perform well.

The quarter’s numbers underscore the momentum. Consolidated profit rose 28% year-on-year, with revenue up 21% to around the mid-thirties- to low-thirties- thousands of crores range, as per different segments within the group. The company noted that while one-offs skewed quarterly results, the core earnings story remained intact with tractors delivering more than 50% PAT growth.

Looking ahead, the company expects the GST cuts to show a more pronounced impact in the December-to-March period, with the Q4 environment potentially reflecting more benefit. In addition to tractors, Mahindra & Mahindra reiterated strength in its SUV line, and signaled progress on its electric vehicle roadmap, with a new electric SUV expected to debut by the end of November and early demand signals for BE6 and XEV 9e models. The management remains confident that FY26 could be even stronger than FY25 as overall demand improves.

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