If we consider the figures that you published for FY'23, we can observe a significant increase in the sales of Swaraj tractors. What are the factors that have contributed to this growth?

The industry is buoyant, and growth is being driven by various enabling factors in the rural economy. However, our growth has been notably higher due to our customer's loyalty to our brand. Additionally, we have made significant product interventions in terms of our customer offerings. Unlike launching a completely new model, the changing agricultural practices and cropping patterns mean that Indian farmers require a tractor that is more suitable for their evolving needs. Therefore, even if we introduce a new variant from the same brand, it becomes a new offering for the farmer. In summary, our growth has been driven by our customer-centric efforts, our product introductions, and the agility of our sales force in capturing customers.

In the tractor business, particularly in Punjab, there are many local players. How does Swaraj differ from them, given that local brands could be preferred due to their cheaper pricing?

A farmer is an intelligent individual, and a tractor is a livelihood machine for them - it is not just a mode of convenience. Therefore, farmers make prudent decisions when it comes to purchasing tractors. Our broad positioning is focused on power, long life, and reliability. Despite the availability of cheaper options from local players, farmers see the value of our product, and how Swaraj tractors meet their needs in terms of power and reliability. This is why there is a loyalty factor towards Swaraj. We believe that Swaraj is a brand of generations, and we stand by this equation. We achieve this first by offering quality products, and secondly, by bringing customers to our factories, so they can witness how the tractor is manufactured. Even though farmers may pay a premium for our product compared to local players, we enjoy a healthy market share and hold the number one position (considering M&M and Swaraj together), especially when many players are offering products at competitive prices.

When it comes to segment-wise, need-based mechanisation for the farming sector, how is Swaraj addressing this gap through its products and solutions?

The agriculture sector in India is constantly evolving, and the need for mechanisation is increasing due to the challenge of labour availability. Additionally, farmers aspire to achieve better productivity and crop quality, which can be achieved through better farming practices and increased efficiency. Swaraj is helping to address these needs by providing different attachments and mechanisation aids to enable better farming practices. We are developing products that can suitably accommodate attachments, thereby allowing farmers to carry out farming more efficiently and in different ways, while also reducing their dependence on manual labour.

Furthermore, we are bringing in products at better price points, ensuring that even smaller farmers can afford tractors that can easily attach and incorporate any necessary features. We also cater to farmers who require machines other than tractors, such as those in horticultural farming, which is growing in numbers, year-after-year. Tractors cannot move on such (horticulture) narrow-space farms, and thus farmers require lightweight machines that can move into such spaces without damaging the roots of the crop.

Last year, we introduced a horticultural machine called CODE by Swaraj to provide farmers with a mechanisation solution that did not exist before. This machine is ideal for someone upgrading from a powertiller but who does not require a tractor, reducing labour and making them more self-sufficient. In this way, we are changing farming practices and enabling farmers to be more productive and efficient.

When we talk about region-based demands of Swaraj tractors, which regions provide a good business opportunity?

We have a uniform market share across all five zones throughout India. Although some people may believe that Swaraj is only popular in North India, we are equally sought after by farmers in regions such as Telangana, Andra Pradesh, and Maharashtra. Therefore, our brand has expanded from being considered a North India brand to an all-India brand with an equal market share across all regions.

You mentioned the technological advancements that have been made in the tractor sector. Do you offer any programs to educate farmers about these advancements? Additionally, do you provide any training to farmers?

At Swaraj, we understand that a new product cannot be successful unless farmers are aware of it. Therefore, we aim to establish a long-lasting relationship with our customers and build a brand that will last for generations. To achieve this, we have developed a unique program called ‘Swaraj Satkar.' This program was highly successful until the onset of the Covid pandemic. However, we are currently in the process of re-establishing it.

As part of the program, we invite customers from various regions to visit our plant to learn about the manufacturing process of Swaraj tractors. We showcase our facilities and use this opportunity to understand their needs and gain early feedback before introducing any new product. We also take customers to our R&D centre to demonstrate new advancements in technology. In addition to providing training, we strive to connect with our customers and gain insight into their needs and requirements.

Have you received any feedback from a farmer who said he wants a particular type of machine and then you went about making it?

All of our product development is driven by farmer feedback. Tractors made for farmers in Punjab are significantly different from those made for farmers in the South. This variation is due to differences in crops and soil types. For example, rice fields are unique to the South, and without engaging with farmers and gaining a deeper understanding of their needs, we cannot improve our products. Farmer feedback is invaluable, and we also look to learn from other countries where mechanisation is more common than in India. The technology advancements in Europe, for instance, tend to flow to the US, and then to Eastern Europe, before eventually making their way to India. We have our company in Turkey and Brazil, and this allows us to pre-empt technological advancements and apply them to our products. We actively seek feedback from our customers, and we use that feedback to create products that are suitable for local needs. We also aim to create awareness among our customers about potential future needs and pain points, and we develop new products based on those insights. For example, we developed the CODE product based on identified pain points rather than specific customer requests.

Could you elaborate on the sustainable manufacturing processes that you employ?

As a group, we have set ambitious and bold goals for energy usage, water positivity, and zero waste to landfill. We take these goals very seriously and have made significant progress in these areas. We employ sustainable sources for energy production, such as solar power, and our upcoming third assembly plant will be designed to be even more energy-efficient than our current plant. We also work closely with our vendors to create a sustainable supply chain.

Our brownfield foundry in which we have made significant investment is the most challenging area to handle from an environmental perspective. To ensure sustainability, we have implemented technology solutions such as high-efficiency machines, mostly imported from Europe and automated handling to reduce waste and emissions. We have partnered with global players who have expertise in delivering highenergy productivity solutions for their customers.

We are continuously learning from the advancements made by our European counterparts, who have introduced carbon credits to increase stringency. Sustainability is a key factor for us, and we prioritise adopting better technologies and machines to improve energy production while minimising our environmental impact. This is especially important since we have several village settlements around us.

This is how Swaraj upgraded India's cleanest foundry from scratch, click here: https://tinyurl.com/2znsw988 to know more.

Do you have any intentions to expand your (foundry) business by supplying your products to external parties apart from providing them in-house?

Our current objective is to utilise our foundry capacities within the Mahindra Group. We are solely manufacturers and not suppliers. While we may offer our foundry capacity to Mahindra if required, generating income by selling our products globally is not our priority.

Give us a sense of your growth strategy and investment plans going forward. Additionally, what is the expected annual output from your manufacturing plants?

Whilst automobiles may contribute to environmental pollution, agriculture has the opposite effect and is inherently environmentally friendly. We are dedicated to improving the environment. For instance, producing one kilogram of rice can require up to 13,000 litres of water. This can be remedied through sustainable agriculture practices that use less water whilst increasing crop yields and profitability.

Thus, we believe it is our responsibility to create machines that promote crop diversification and help farmers earn better livelihoods. For instance, horticulture is contributing tremendously to the agriculture GDP due to increased food consciousness.

However, we recognise that producing horticultural crops can be very expensive for farmers. Therefore, our product strategy focuses not only on promoting agricultural mechanisation but also on sustainable agricultural mechanisation. Through this approach, we invest in product technology that will aid in our growth. Presently, we are in the process of setting up a manufacturing facility in Humaynpur, Mohali with an investment of Rs 400 crore. Spanning over 40 acres, the tractor maker plans to produce 30,000 tractors per annum at the unit initially, which may be expanded further.

The upcoming state-of-the-art facility will cater to the ever-increasing demand for Swaraj products. The new plant will be designed to set new benchmarks in terms of style, comfort and convenience of the product offerings for our customers. It will also benefit local communities in and around its vicinity as it will create employment and growth opportunities. In the upcoming facility, we plan to produce a wide range of tractors and farm implements starting from land preparation to post-harvest operations.

This new investment will address our needs for the next three years and the continual updating of our machine shops with greener and higher-tech machines will deliver better cost and profitability.

Overall, we aspire to grow higher than the expected long-term market growth of 6 per cent to 8 per cent and our track record over the last two decades demonstrates this.

When discussing sustainability in agricultural mechanisation, what are Swaraj's plans for introducing electric tractors?

There is a significant disparity between electric vehicles (EVs) in automobiles and those in tractors. Automobiles require batteries to operate continuously on roads, whereas tractors must provide power for various purposes, and the battery should fit in the tractor while having the capacity to work 7-8 hours on the field in remote locations. This kind of battery technology is yet to be developed. We are closely monitoring advancements in this area and anticipate seeing betterpowered innovations in smaller-sized tractors, although it is unlikely to occur in heavy agriculture applications. We are mindful of these requirements and are working on them. Several start-ups are working in this field, but overall, it will take time to evolve.

How do you view the impact of data on your business?

Data is critical for any business in this generation, and it can be viewed as the new oil. Our business heavily relies on data, and we are planning to introduce telematics on our tractors to gather customer data and understand how customers work with our machines. This data will help us predict demand and identify areas where (demand) it is high. We plan to use this data to remain connected with our customers through social media and our Swaraj App, which aims to increase customer engagement. Data is a universal requirement for any company to function, and we generate vast amounts of data in our plants, which are fed into maintenance and efficiency modules. We have developed technology that triggers a data analytical system when a machine is about to break down, alerting us that maintenance is needed.

In what way are the data points assisting the R&D team in enhancing the product?

For all the new products that we test, we perform extensive testing across various regions. We meticulously collect all the data that we obtain. To achieve this, we establish service camps where the sales representatives are responsible for entering the customer's profile and intended purchase into the tablet. This information is then stored in our software, which in turn assists us in generating demand.

The entire Industry 4.0 is revolutionising the manufacturing sector, specifically for agriculture mechanisation, how is it helping the growth of the industry?

Our approach in this area is unequivocal. Our goal with Industry 4.0 is to enable lean manufacturing. Lean manufacturing involves five fundamental aspects: Productivity, Quality, Cost, Delivery, Safety, and Morale, which are always at the forefront of our minds. Any automation or industrial development that we implement must impact these areas positively. We do not invest in Industry 4.0 technologies simply for the sake of showcasing our technological prowess. Our investment decisions in this area are purely based on the potential benefits for our customers. This is how we define Industry 4.0 at Swaraj. In addition, we have our foundry in Turkey, and we have asked them what they would do differently if they had to build their foundry again. We incorporate their ideas into our business model, which guides us in coming up with new concepts.