Titagarh Wagons set to make tractors.

Titagarh Wagons Ltd. (TWL) is set to foray into tractor manufacturing. The company’s subsidiary, Titagarh Agrico, has developed three prototype variants, Umesh Chowdhary, MD and Vice-Chairman of TWL, told BusinessLine.

The company has set up a manufacturing unit for tractors at the Bharatpur plant of Cimmco Ltd., another wagon-making subsidiary.

'Initially, we will have a modest capacity of 20,000 units a year. We plan to begin commercial production in January next year,' Chowdhary said. Some of the prototypes have been sent for initial commercial tests to the Central Farm Machinery Training and Testing Institute in Budhni, Madhya Pradesh. 'A few are on the pipeline.'

TWL is now in negotiations with engine makers for long-term sourcing contracts. Other supply contracts are also being firmed up.

It is planning to make tractors ranging from 39 to 60 HP. It is also in the process of selecting component ancillaries and building a distribution network Chowdhary said.

The seven-lakh unit-a-year tractor market in the country, which is growing 20 per cent annually, provides room for new players, he added.

The company will primarily focus on Rajasthan, Haryana, Uttar Pradesh and Bihar markets.

The diversification will utilise TWL’s fabrication and engineering strength and Cimmco’s infrastructure in the northern tractor heartland.

'This venture would entail lower-than-usual capital expenditure and could be more cost-effective than many of its competitions', Chowdhary said. 'It also helps the Titagarh group's efforts to de-risk its Railways-dependent wagon businesses in India,' he added.

HBL