According to the recently released data by Pakistan Automotive Manufacturers Association (PAMA), tractor sales have reached a three year high due to the tax relief offered by the government. It is predicted that sales would continue to grow for some time and benefit major tractor manufacturers of the country.
Total unit sales reached 5,390 in January 2017, which is the highest number since December 2013, according to the official figures.
Per unit sales figure of Millat Tractors Limited, Pakistan’s largest tractor company, is set to exceed 30,000 units during the year ending June’17 versus 21,000 units last year, registering a growth of 42 percent YoY (expected sales units given by the company CEO Syed Muhammad Irfan Aqeel).
Al-Ghazi Tractors is also anticipating a 15 percent YoY increase on its sales, said Muhammad Shahid Hussain, CEO of the company.
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Many industry analysts believe that these incentives are provided for a limited time period; since the government is aware that majority of its vote bank is from rural areas. This measure is slightly delayed but still it is at the time when the country is on the verge of elections. The theory suggests that the current government wants to capitalize upon the agriculture driven masses of the country.
While giving a statement about this matter, Prime Minister Nawaz Sharif stated:
“Agriculture is the backbone of our economy. We should facilitate farmers to achieve bumper crops for accelerated gross domestic product growth”
Tractor Companies’ Stocks Exhibit Improvement
Shares of these tractor companies showed some improvement as Al-Ghazi Tractor share price increased to Rs610, an increase of 4 percent. Similarly, Millat Tractor also grew by 2 percent. The modest increment in share price is due to growing sales numbers released by the authority. Hence, there are promising prospects of agriculture sector in the near future.
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Although the current government looks committed to bring a boost in the agriculture sector but many experts are skeptical about this growth as these incentives are driven by their political motives. What are your thoughts?
Source: Profit Pakistan
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