Bengaluru-headquartered VST Group has decided to expand its business in all the three verticals it operates, said Managing Director Arun V. Surendra.
The 113-year-old business conglomerate is a franchise dealer for luxury and sports cars in Tamil Nadu and Karnataka, manufactures farm equipment and runs deposit taking NBFC Gove Finance Ltd.
In the automotive dealership space, VST Group plans to double its touchpoints from the present 50 to 100 in the next three to four years and in the farm equipment space to triple the revenue to ₹3,000 crore by FY26 by investing in emerging markets and through product innovation.
“Due to the changing lifestyles, we are seeing a rise in the luxury car sales in Tamil Nadu. It has crossed the pre-Covid level by more than 30-40% across all brands. Hence, it calls for expansion,” he said in an interview.
With a better road network and increasing urbanisation of Tier II & III cities, expansion across all brands has already commenced and will continue over the next two years. It entails an investment of ₹300-400 crore for land, building and machinery.
According to him, VST Group is the preferred partner for 11 major brands such as Mercedes-Benz, Jaguar-Land Rover, Porsche, Kia, Volkswagen, BYD, Ducati, Tata Motors, Mahindra and Honda. It clocked a revenue of ₹2,000 crore.
Asserting that over 90% of VST tractors and tillers are sold in the Indian market, he said that they plan to increase the share of exports to about 8-10% in the coming years by entering new markets.
During FY23, VST Tillers Tractors Ltd., (VTTL) posted revenue of ₹1,006 crore. It has a tractor plant at Hosur, power tillers at Malur and components and implements at Mysuru.
VTTL has a joint venture with Czech-based Zetor Tractors in India to make tractors under VST Zetor brand.
“The first tractor of 50hp will be rolled out this year. With this launch, the share of VST in the higher HP sector in tractor volumes is expected to increase to 20% in the next two years,” he added.
Besides, VTTL has a minority stake in the US-based start-up Zimeno Inc., a leading electric tractor manufacturer. VTTL is the main supplier of the tractors from India while the final assembly happens in the USA.
“Additionally, we are actively pursuing strategic collaborations with global players to develop electric tractors for both domestic and international markets,” he said.
Gove Finance is the lending arm of the Group for commercial vehicle customers. “Going forward, we are planning to invest/partner with fintech companies to make the entire credit analysis of a customer more seamless and quicker,” he said.
