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1. Agricultural Machinery Market – India
July 2017
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2. Agricultural Machinery Market in India 2017
Executive Summary
Market Overview
Drivers and
Challenges
Government
Initiatives
Competitive
Landscape
• Globally, agricultural machinery market is projected to grow at a CAGR of ~x% to reach INR x bn by 2022 from INR x bn in 2015
• Indian agricultural machinery market is projected to grow at a CAGR of ~x% to reach INR x bn by 2022 from INR x bn in 2015
• Farm mechanization program in India aims to integrate the use of available human and animal farm power with mechanical sources of power for
increasing the productivity
• Mahindra and Mahindra, Escorts, VST, and Force Motors are the major players in the agricultural machinery market in India
• The attractive subsidies given by the central and the state governments have also encouraged farmers to buy farm equipment
• Higher productivity and greater output are the two major factors driving farm mechanization
Drivers
• Improved Availability of Credit
• Focusing on Productivity Through various Methods of
Mechanization
• Low Penetration of Mechanization in India
• Contract Farming
Challenges
• Fragmentation of Land
• High Cost of Agricultural Machines
Major Players
Escorts Ltd. Force Motors Ltd. Greaves Cotton Ltd. Mahindra and Mahindra Ltd.
Shivagrico Implements Ltd. VST Tillers Tractors Ltd. International Tractors Ltd. John Deere India Pvt. Ltd.
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• National Mission on Agricultural Mechanization
• Sub-Mission on Agricultural Mechanization
• Agricultural Machinery Subsidy Scheme By Government of India
• Tractor Subsidy Scheme By Government of India
• Pradhan Mantri Krishi Sinchay Yojana
• Implementation of GST

3. 3
Socioeconomic Indicators
Market Overview
Market Influencers
Competitive Landscape
Recent Developments
Appendix
Trade Analysis
Market Trends
Government Initiatives

4. Agricultural Machinery Market in India 2017
Socioeconomic Indicators
Total Population
4
Population Density
1,000
500
1,500
0
mn
2019 2020
X%
2010 201820172012 2013 2015 20162011 2014
0
100
200
300
400
500
2015 2016 2017 2018 2019 2020
X%
2010 2011 2013 20142012
Persons per sq. km

5. Agricultural Machinery Market in India 2017
Market Definition & Structure
5
Market Definition
• Agricultural machines refers to machineries that are used for the production of crops and agricultural livestock
• Mechanization of farm indicates the use of machines for conducting agricultural operations by replacing the traditional methods which involve human and animal labor
 xx
Heavy Engineering
xx xx xx
• xx
• xx
• xx
• xx

6. Agricultural Machinery Market in India 2017
Key Facts – Agriculture Sector in India
6
• Farm power availability in India is estimated at x kw/ha
• x% of rural population is employed in agriculture and x% of households is dependent on it
• Agriculture and allied sectors contributes ~x% to GDP and x% of labour force
• Mechanization level in India is ~x%
 xx
Present Scenario of Agriculture in India

7. Agricultural Machinery Market in India 2017
Evolution of Agriculture in India
7
1950s: Stagnation in
agriculture and low
growth
xx
1960-’80: Pioneering work of
agricultural scientists and
efforts of farmers led to Green
Revolution
xx
1980-2000: Expanding cereal
production
Economic reforms
introduced, which increased
exports
xx
2000 onwards: 50% increase in
seed subsidy
Additional financial assistance
for horticulture crops
Schemes such as the Pradhan
Mantri Krishi Sinchayee Yojana
that gives high priority to water
security
xx
• In FY 1951, India produced ~50 mn tons of food grain which was not
sufficient to meet the demand of the Indian population of 350 mn
people
 This led to the import of food grains into India
• Agricultural land was characterized by low productivity with
production of 580 kg/ha
• xx

8. Agricultural Machinery Market in India 2017
Agriculture Employment Scenario
8
Particulars 1991 2001 2011 2020e 2050e
Country’s Population xx xx xx xx xx
Total Number of Workers xx xx xx xx xx
Workers’ Percentage of Population xx xx xx xx xx
Number of agricultural workers xx xx xx xx xx
Including: Cultivators xx xx xx xx xx
Including: Agricultural Laborers xx xx xx xx xx
Agricultural Workers’ percentage of
Total Number of Workers
xx xx xx xx xx
Population Dynamics of Indian Agricultural Workers and Farm Labor Shortage

9. Agricultural Machinery Market in India 2017
Types of Farming
9
Sl. No. Items Private Farming Co-operative Farming Contract Farming Corporate Farming
1 Ownership xx xx xx xx
2 Risk Sharing xx xx xx xx
3 Ease of credit xx xx xx xx
4 Capital xx xx xx xx
5 Farm-firm flow xx xx xx xx
6 Access to the market xx xx xx xx
7 Use of Technology xx xx xx xx
8 Role of the Government xx xx xx xx
9 Sustainability of the farming xx xx xx xx
Types of Farming – Overview

10. Agricultural Machinery Market in India 2017
Agriculture Value Chain
10
Value Chain Analysis
Land Development, Tillage,
Seed Bed Preparation
Sowing
and
Planting
Weeding,
Inter
Cultivation,
Plant
Protection
Harvesting
and
Threshing
Post Harvest
and
Agro
Processing
• Clearing jungles
• xx
• Sowing seeds at the
required dept,
distance and seed
rate
• Weed control
• xx
• To separate grain
straw , tubers
without much loss
• xx
• Cleaning
• xx
Tractors, tractor-driven devices and tillers are the main products of the organized market
• Tractors
• xx
• Drill
• xx
• Shovel/Plough
• xx
• Harvester
• xx
• Seed Extractor
• xx
ObjectiveEquipment

11. Agricultural Machinery Market in India 2017
Mechanization Level
11
Level of Mechanization by Crop Across the Value Chain (FY 2014)
Crop Seedbed Preparation
Sowing / Planting /
Transplanting
Weed and Pest Control Harvesting
Paddy xx xx xx xx
Wheat xx xx xx xx
Potato xx xx xx xx
Cotton xx xx xx xx
Maize xx xx xx xx
Gram xx xx xx xx
Sorghum xx xx xx xx
Millets xx xx xx xx
Oilseeds xx xx xx xx
Sunflower xx xx xx xx
Fodder Crop xx xx xx xx
Vegetable Crop xx xx xx < xx
Horticulture Crop xx xx xx < xx

12. Agricultural Machinery Market in India 2017
Market Overview – Global
12
Agricultural Machinery Market Size & Growth Forecast
0
5,000
10,000
15,000
20,000
FY 2019e FY 2021e
+x%
FY 2022eFY 2020eFY 2018eFY 2017eFY 2015 FY 2016
INR bn
• Globally, agricultural machinery market is projected to grow at a CAGR of ~x% to reach INR x bn by 2022 from INR x bn in 2015
 Increasing demand for farm tractors and harvesting machinery will boost the overall agricultural machinery market
 xx
Current Market Scenario

13. Agricultural Machinery Market in India 2017
Market Overview – India
13
Agricultural Machinery Market Size & Growth Forecast
0
200
400
600
800
INR bn
FY 2021eFY 2020eFY 2019e
+x%
FY 2018eFY 2017eFY 2016FY 2015 FY 2022e
• Indian agricultural machinery market is projected to grow at a CAGR of ~x% to reach INR x bn by 2022 from INR x bn in 2015
• Major farm machinery used in India includes tractors, threshers and power tillers, among others
 xx
Current Market Scenario

14. Agricultural Machinery Market in India 2017
Market Overview – India (Contd.)
14
Tractor and Power Tiller Market in India (FY 2010 to FY 2014)
• A large portion of the farming population of the country falls in the small and marginal segment
 The market for power tillers is mainly in eastern and southern parts of India due to the availability of small land holdings per farmer and high cultivation of rice
• xx
Current Market Scenario
0
100
200
300
400
500
INR bn
+x%
FY 2013FY 2011FY 2010 FY 2014FY 2012
Tractor Market
0
2
4
6
8 +x%
FY 2010 FY 2013FY 2011 FY 2012
INR bn
FY 2014
Power Tiller Market

15. Agricultural Machinery Market in India 2017
Market Overview – India (Contd.)
15
Thresher and Rotavator Market in India (FY 2010 to FY 2014)
• The thresher market in India is highly unorganized and is commanded by large number of small and medium scale enterprises, which are located in Punjab, Haryana, Uttar Pradesh,
Bihar, Madhya Pradesh, Gujarat, Maharashtra, and Andhra Pradesh
 Agricultural machinery has made significant inroads in northern states of Punjab, Haryana, and Uttar Pradesh
• xx
Current Market Scenario
0
5
10
15
INR bn
+x%
FY 2013FY 2011FY 2010 FY 2014FY 2012
0
5
10
15
20
+x%
FY 2010 FY 2013FY 2011 FY 2012
INR bn
FY 2014
Thresher Market Rotavator Market

16. Agricultural Machinery Market in India 2017
Market Segmentation – India
16
Agricultural usage
Non Agricultural usage
• Demand for tractors is derived from both agricultural and non agricultural activities
• x% usage of tractors in India is used for non agricultural purposes such as in sand
mines, brick kilns, road making, passenger and others
• xx
In Lakh Units FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 CAGR FY 2011 - 2014 CAGR FY 2014 - 2016
<30 HP xx xx xx xx xx xx xx% - xx%
31 – 40 HP xx xx xx xx xx xx xx% - xx%
41 – 50 HP xx xx xx xx xx xx xx% - xx%
>=50 HP xx xx xx xx xx xx xx% xx%
Total xx xx xx xx xx xx xx% - xx%
Growth of Tractors
Agricultural and Non Agricultural Usage of Tractors

17. Agricultural Machinery Market in India 2017
Market Segmentation – India (Contd.)
17
Player-Wise Segmentation of 6 Major Players in the Tractor Industry (FY 2014 – FY 2016)
FY 2015 FY 2016FY 2014
• In domestic tractor market of <x HP segment, Mahindra and Mahindra is the market leader with ~x% market share in FY 2016
• VST’s market share has been increasing considerably year after year
 xx
Mahindra and Mahindra Ltd. TAFE VSTEscorts International Tractors Ltd.Force Motors

18. Agricultural Machinery Market in India 2017
Market Segmentation – India (Contd.)
18
Tractor Sales by Segment (FY 2011 and FY 2015)
FY 2015FY 2011
• Higher productivity and greater output are the two major factors driving farm mechanization
• The tractor industry in India has seen a strong volume growth in the last few years backed by strong domestic demand and initiation of exports
• xx
31-40 hp>50 hp 41-50 hp <30 hp

19. Agricultural Machinery Market in India 2017
Geographic Segmentation
19
Gujarat West Bengal
Maharashtra
Madhya Pradesh
Uttar Pradesh
Punjab
Haryana
Key Agriculture States and Their Contributions
Assam
Karnataka
• Punjab and Haryana were the key states of Green
Revolution
• xx
• xx
• xx
• xx
• xx
• xx
• xx
• xx

20. Agricultural Machinery Market in India 2017
Geographic Segmentation (Contd.)
20
• The manufacturers of agriculture machinery in India comprises
village artisans, tiny units, small scale industries to State Agro
Industrial Development Corporations and organized tractor, engine
and processing equipment industries
 Village craftsmen and small scale industries fabricate traditional hand
tools and bullock drawn carts
 xx
Geographical Segmentation – Based on Availability of Agricultural Machinery Manufacturers
- Large Availability of
Manufactures
- Medium Availability of
Manufacturers
- Deficient Availability in
Manufacturers

21. Agricultural Machinery Market in India 2017
Geographic Segmentation (Contd.)
21
Segmentation – Based on Type of Manufacturers in India
• Diesel engines, electric motors, irrigation pumps, sprayers and dusters, land development machinery, tractors, power tillers, post harvest and
processing machinery and dairy machinery are produced by medium scale and large scale industries
• Marketing of the agriculture machinery is done through their network of dealerships
• xx
Organized Farm
Machinery Industries
• Tiny and small scale industries provide improved agricultural machinery, such as ploughs, cultivators, disc ploughs and harrows, seed grills,
planters, plant protection equipment, reaper harvesters, combine harvesters, threshers, cleaners, graders, mills, crushers, oil expellers, diesel
engines, irrigation pumps, dairy machinery and others
• Small scale industries produce bulk of agriculture machinery
• xx
Tiny and Small Scale
Industries
• Village artisans are sources of supply, repair and maintenance of hand tools
• These tools include spade, sickle, local ploughs, sowing devices, yokes, leveller, grinding wheels, hand mills, hand operated milk churning
tools, sieves, wooden storage structures, bullock carts, manual water lifting devices and others
• xx
Village Level
Craftsmen

22. Agricultural Machinery Market in India 2017
PESTEL Analysis
22
Political
• The government policies regarding land, irrigation, marketing, trade and others have direct impact on agriculture
• xx
Economic
• Agriculture contributes 17% to country’s Gross Value Added (GVA)
 xx
Social
• Efficiency in agriculture depends on the possession and size of land holding of farmers
 xx

23. Agricultural Machinery Market in India 2017
Export – HS Code 8432
23
Export (Value)
0
2,000
4,000
6,000
INR mn
+x%
FY 2017FY 2016FY 2015FY 2014
Others
Bangladesh
Thailand
Myanmar
Sri Lanka
Algeria
USA
Algeria
Bangladesh
Myanmar
Nepal
USA
Sri Lanka
Others
Country-Wise Segmentation (Value-Wise)
FY 2016 FY 2017
HS Code 8432 refers to Agricultural, Horticultural / Forestry Machinery for Soil Preparation / Cultivation; Lawn / Sports – Ground Rollers

24. Agricultural Machinery Market in India 2017
Trade Analysis
24
Farm Machinery Trade – Tractor Trade (Units)
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
Units
FY 2014FY 2013FY 2012FY 2011FY 2010FY 2009
• India is the largest tractor market in the world
• Not only does it produce tractors domestically but it also exports them to other countries
• xx
ImportExport

25. Agricultural Machinery Market in India 2017
Market Drivers
25
Increase in Credit Flow for Farmers
• Credit acts as a catalyst to accelerate the development of the farm and non farm sector which includes rural industrialization, business and service sector of the
economy
• Credit helps farmers to invest in creating assets which will further help to generate output and income through the use of modern science, technology and
modern methods of business management
 xx
Improved Availability of Credit
0
5,000
10,000
15,000
20,000
INR bn
+x%
11th Five Year
Plan (2007-2012)
10th Five Year
Plan (2002-2007)
9th Five Year
Plan( 1997-2002)
Increase in Annual Average Disbursement
0
2,000
4,000
6,000
8,000
INR bn
FY 12
+x%
FY 11FY 10 FY 13

26. Agricultural Machinery Market in India 2017
Market Challenges
26
• The overall land holding in India is fragmented
• In order to ensure livelihood security of marginal and small farmers, it is important to focus on technological needs and infrastructure
• xx
Fragmentation of Land
0
50
100
150
200
FY 2001 FY 2011FY 2006
mn ha
Area of Landholdings
Marginal Small LargeSemi-Medium Medium

27. Agricultural Machinery Market in India 2017
Government Initiatives
27
National Mission on Agricultural Mechanization (NMAM)
• Establishment of farm machinery banks for custom hiring
• Establishment of hi-tech and high productive equipment centres
• xxOther
Interventions
• It was introduced by Department of Agriculture, Cooperation and Farmers Welfare to restructure and categorize all Agriculture Development
Schemes in the 12th plan
 It aims at promotion and strengthening of agricultural mechanization through training, testing, and demonstration
 xxObjective

28. Agricultural Machinery Market in India 2017
Market Trends
28
Custom Hiring in Agriculture Machinery
• To provide various farm machinery to small and marginal farmers
• To offset the adverse economies of scale due to high cost of individual ownership
• xx
Objective
• Custom hiring is an evolving concept in India and holds immense potential to change the farm mechanization landscape of India
 Custom hiring promotes establishment of agricultural machinery banks for hiring by way of providing financial assistance to self help group of farmers
 xx
Definition
• Sub Mission on Agricultural Mechanization (SMAM) provides financial assistance to establish agricultural machinery banks for custom hiring for
appropriate place and crops
 It promotes mechanization in districts with low availability of farm power
 xx
Farm
Machinery
Banks

29. Agricultural Machinery Market in India 2017 29
List of Major Players
Name Website
Company 1
Company 2
Company 3
Company 4
Company 5
Company 6
Company 7
Company 8
Company 9
Company 10
Competition

30. Agricultural Machinery Market in India 2017 30
Company Information
Corporate Address
Tel No.
Fax No.
Website
Year of Incorporation
Business Description
• xx
Public: Domestic Company – Company A
Products and Services
Category Products/Services
xx xx
xx xx
xx xx
xx xx
Key People
Name Designation
Person 1 Chief Executive Officer
Person 2 Chief Operating Officer
Person 3 Head – Operations
Person 4 Chief Marketing Officer

31. Agricultural Machinery Market in India 2017 31
Key RatiosFinancial Snapshot
Key Financial Performance Indicators
Indicators Value
Market Capitalization (INR mn)
Total Enterprise Value (INR mn)
EPS (INR)
PE Ratio (Absolute)
Particulars 2013 2014 2015 2016
Profitability Ratios
Gross Margin %
Net Income Margin %
EBITDA Margin %
EBITA Margin %
EBIT Margin %
Return on Assets %
Return on Capital %
Return on Equity %
Return on Common Equity %
Liquidity Ratios
Current Ratio
Quick Ratio
Leverage Ratios
Total Debt/Equity
Total Debt/Capital
Interest Coverage
Efficiency Ratios
Total Asset Turnover
Fixed Asset Turnover
Accounts Receivable Turnover
Inventory Turnover
Net Profit / LossTotal Income
x
z
x
c
d
e
a
b
c
d
e
f0
y
FY 2016FY 2015FY 2014FY 2012
Public: Domestic Company – Company A (Contd.)

32. Agricultural Machinery Market in India 2017 32
Key Business Segments Key Geographic Segments
0%
20%
40%
60%
80%
100%
FY 2015FY 2014FY 2013 FY 2016
Segment 3Segment 2Segment 1
0%
20%
40%
60%
80%
100%
2016FY 2015FY 2014FY 2013
Country 1 Country 2
Public: Domestic Company – Company A (Contd.)

33. Agricultural Machinery Market in India 2017 33
Company Information
Corporate Address
Tel No.
Fax No.
Website
Year of Incorporation
Business Description
• xx
Private: Domestic Company – Company B
Products and Services
Category Products/Services
xx xx
xx xx
xx xx
xx xx
Key People
Name Designation
Person 1 Chief Executive Officer
Person 2 Chief Operating Officer
Person 3 Head – Operations
Person 4 Chief Marketing Officer

34. Agricultural Machinery Market in India 2017
Recent Developments
34
Date Category Description Impact
Feb 22, 2017 Collaborations & Partnerships Low
Feb 01, 2017 Product Launch Low
Dec 19, 2016 Regulatory High
Dec 15, 2016 Regulatory Medium

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