Escorts posts good harvest for Q3

about 1 year ago
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Escorts is figuring among the top five losers on the BSE. The stock price fell 6.5% to Rs.630.55 and continues to remain pretty much in the red. Its 52-week low is at Rs.542.60 and high at Rs.1018.50.

The company posted a good set of numbers for Q3FY19 but what has worried the market is its estimates for the future.

Escorts reported a profit of Rs.140 crore in the third quarter ending December 31, up by 52% (YoY) on a 37% increase in revenue at Rs.1655 crore. This was on the back of healthy overall volume growth and good demand from its well-established markets of North and Central India.

But looking ahead, on account of higher inventory held by others in the sector, monsoon deficit in South and Western India, slowdown in some geographies, the management lowered the guidance for FY19 volume growth for domestic tractor industry to 10-12% from 12-14% given earlier.

But the market seems to have taken an over pessimistic view as its 9MFY19 performance shows a net profit of Rs.363 crore, which has already surpassed the entire FY18 net profit of Rs.345 crore. With one more quarter to go, even a lower profit will ensure ending FY19 on a much higher note.

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