"VST Tillers & Tractors to Establish ₹100 Crore Global Tech Centre in Hosur"

VST Tillers & Tractors, a leading manufacturer of farm equipment and tractors, is set to bolster its research and development capabilities by establishing a global tech centre in Hosur, Tamil Nadu. This centre aims to accelerate innovation in electric vehicles (EVs), develop proprietary technologies, enhance testing capabilities, and foster international collaborations. It will serve as the company's primary R&D hub, focusing on electric powertrains, battery technologies, and advanced driver assistance systems, enabling the creation, testing, and validation of cutting-edge, reliable, and safe electric vehicles.

The company plans to invest ₹100 crore in establishing the global R&D centre in a phased manner. This investment follows the ₹100 crore VST has already poured into R&D over the past three to four years, as mentioned by Arun V Surendra, Chairman of VST Tillers & Tractors, in the company’s latest annual report. These ongoing R&D investments will propel the company forward, enabling the introduction of advanced solutions tailored to the evolving needs of farmers.

Headquartered in Bengaluru, VST is currently developing at least 10 new products, including electric vehicle models. The company is also expanding its presence in emerging markets. In April, VST established a wholly-owned subsidiary, VST Americas Inc., in the US, to tap into the tractor and farm machinery market, with plans to launch products there by FY26.

During a recent earnings call, VST Managing Director VT Ravindra indicated that the company is developing products specifically for the US market, which has distinct requirements compared to Europe. VST first entered Europe in 2016 with its ‘VST Fieldtrac’ range of compact products that meet EU regulations. To further strengthen its presence in North America, VST has also established a step-down subsidiary, VST Fieldtrac LLC, in the US.

VST Tillers & Tractors currently has a presence in over 40 countries, including Europe, Asia, and Africa. The share of international business in the company's revenue has grown from approximately 4% in FY20 to 8% in FY23, and further to 13.5% in FY24. Despite a dip in operating revenue to ₹968 crore in FY24 from ₹1,006 crore in FY23, the company’s profit after tax rose to ₹122 crore in FY24, up from ₹92 crore the previous year.

HBL