Market sentiment still positive: Escorts Agri Machinery

In an interview to CNBC-TV18, Sameer Tandon, Chief of Sales, Service & Spares of Escorts Agri Machinery spoke about company’s sales numbers.

Below is an edited transcript of the interview on CNBC-TV18 Q: Your total sales grew 8 percent but what stood out were your exports. A: Export sale is not a very big feature this month. It is just that you had logged in orders, which got executed this month. Of course, our efforts have been to increase exports but there is nothing to do very specially about anything which has happened special this month. Q: Total sales are up 8 percent in line with the industry growth. Is that going to be a trend for the rest of the year? A: Should be because July and August are very sluggish months usually. In these months also as an industry we have witnessed a growth of about 10 percent and we have stayed along with that. So I think it should continue in the same way. The sentiments in the markets are still very positive. Q: This month-on-month decline that we have seen is this just the August specific factor and going forward in September you should register an increase even month-on-month? A: July and august are very poor months always. It is rainy time and it is flood and water allover the place. So at this point of time buying new tractors is usually a very big no in the farmers. But September is again a month which is little dull month but October-November are the big season months and we expect that October-November we should get back to what we had a quarter before type of growth which should be about more than 15 percent. Q: Was there any sort of price revision that was undertaken in this previous month or any sort of price revision on the upside or the downside that you would be considering within the domestic market going forward? A: We took the price increase in the month of May and we are good as of now. We don’t see any price increase in next two months but we would see as the inflation comes in and what we need to do. Q: What about margins? A: Margins are looking alright as of now because our import content is very little and with automotive market not doing so great, the inflation has not been too much on the component side as well. So I think we are good at margins as of now. Q: Is there a monthly volume rate that you would be looking at in the foreseeable future which you can share with us? A: Agriculture business is very cyclic business and it depends on what the crop cycles are. So to look at a monthly number is very difficult. It usually depends on what time the harvest happens and the farmer gets money and that is the time you would surely like to see upticks happening in sales. So this business we should evaluate in terms of what happens in the peak times and how volumes go up. Q: Just to come to that pricing bit again, we have seen quite a bit of uptick in commodity prices in rupee terms, has the price increase taken care of that and would you need to increase some more in terms of prices? A: At this point of time we see that we are good. We don’t want to disturb the market with a price hike just before the season but surely as inflation accumulates and if we find that we are not able to manage that we would go in. As of today, our margins are looking pretty good, the sales are good and we would like to go in that same way for at least next two months.