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Informist, Monday, Nov. 3, 2025

 

By Ashutosh Pati

 

MUMBAI – Escorts Kubota Ltd. is likely to have had a good September quarter, with a sharp increase expected in both the bottom line and the top line as positive sentiment in rural areas and the early onset of the festive season led to robust sales of tractors, according to analysts. However, the growth in revenue will be partially offset by weak sales of construction equipment.

 

The agricultural and construction equipment manufacturer is expected to post a net profit of INR 3.48 billion for the September quarter, up 15% on year and over 17% on quarter, according to the average of estimates from six brokerage firms. Estimates for the company's net profit range from a low of INR 3.30 billion by YES Securities (India) Ltd. to a high of INR 3.70 billion by Motilal Oswal Financial Services Ltd.

 

Escorts Kubota's revenue is expected to rise around 23% on year and nearly 12% sequentially to INR 27.76 billion for the September quarter, according to the consensus estimates. YES Securities has the lowest estimate for the company's revenue at INR 27.35 billion, while Anand Rathi Share and Stock Brokers Ltd. has the highest estimate of INR 28.43 billion.

 

The company's tractor sales rose over 30% on year to 33,877 units in Jul-Sept while reporting robust monthly sales volume in September. Escorts Kubota sold 18,267 tractors in September, up around 48% on year, driven by favourable rural conditions, an above normal and well distributed monsoon, and an early festive season. The recent cut in the goods and services tax on tractors and farm machinery also boosted sentiment, the company had said in October.

 

Domestic sales during the quarter grew nearly 31% on year to 32,329 units and exports grew over 26% to 1,548 units. In September, domestic tractor sales grew nearly 49% on year while international sales rose around 18%. However, sales of construction equipment fell almost 18% on year to 1,146 units in the September quarter and 19% on year to 413 units in September.

 

Escorts Kubota's earnings before interest, tax, depreciation, and amortisation, or EBITDA, is seen rising over 12% sequentially and over 36% on year to INR 3.65 billion, according to the average of estimates from five brokerages. Estimates for the company's EBITDA range from INR 3.44 billion by YES Securities to INR 3.78 billion by Emkay Global Financial Services Ltd.

 

"After a subdued 1% growth in 1Q (Apr-Jun), Escorts bounced back strongly in 2Q (Jul-Sept) and posted 30% YoY growth in tractor volumes, in line with strong pickup in industry demand," Motilal Oswal said in a report. With the strong pickup in volumes, margin is expected to rise 50 basis points sequentially and 330 bps on year to 13.6% in Jul-Sept, according to the brokerage.

 

Of the 11 brokerage reports on the company available with Informist, three have a 'buy' or equivalent rating on the stock, five have a 'hold' or equivalent rating with an average target price of INR 3,399, and three have a 'sell' or equivalent rating.

 

On Monday, shares of Escorts Kubota closed 1.6% higher at INR 3,846.5 on the National Stock Exchange. Since reporting its June quarter earnings on Aug. 4, shares of the company have risen over 13%.

 

For the June quarter, the company had reported a net profit of INR 3.73 billion, up 40% on year and around 49% sequentially. Its revenue had fallen nearly 3% on year but rose over 2% sequentially to INR 24.83 billion.

 

Following are the Jul-Sept earnings estimates for Escorts Kubota from six brokerages in descending order by the estimate of net profit, in INR million:

 

Brokerage firm	Net sales	Net profit	EBITDA
	-------(In INR million)------
Motilal Oswal Financial Services Ltd.	27,588	3,703	3,752
Kotak Institutional Equities	27,735	3,569	3,671
Anand Rathi Share and Stock Brokers Ltd.	28,427	3,537	--
Nuvama Wealth Management Ltd.	27,445	3,426	3,588
Emkay Global Financial Services Ltd.	28,019	3,362	3,783
YES Securities (India) Ltd.	27,350	3,298	3,438
Average	27,760.67	3,482.50	3,646.40

 

End

 

Edited by Tanima Banerjee

 

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