Mahindra & Mahindra Ltd., India’s biggest maker of sport-utility vehicles and tractors, will begin selling construction equipment as the nation boosts investments in infrastructure to help sustain economic growth.
Mahindra spent 3 billion rupees ($66 million) to develop a backhoe loader that will go on sale from next month, Pawan Goenka, president of automotive division, said in Mumbai today. The company will build 200 of the equipment a month at its Chakan, western India factory, he said.
Mahindra, Terex Corp. and Caterpillar Inc. are expanding in India to benefit from rising heavy equipment demand as the government steps up spending on roads, ports and airports. The nation needs $1 trillion of investment in infrastructure between 2012 and 2017, double the estimated spending in the previous five years, to narrow the gap with China, Prime Minister Manmohan Singh’s government says.
“We see a huge demand for backhoes with so much construction taking place all over the country,” said Kairas Vakharia, head of Mahindra’s construction equipment business. “The market for construction equipment is growing at a very fast pace.”
Mahindra was little changed at 669.2 rupees at the 3.30 pm close of trading in Mumbai. The benchmark Sensitive Index of the Bombay Stock Exchange rose 0.2 percent.
The automaker introduced a new range of trucks last year through its joint venture with Navistar International Corp. Mahindra also agreed to acquire a controlling stake in South Korea’s Ssangyong Motor Co. and Bangalore-based Reva Electric Car Co. in 2010.
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