Escorts Kubota - Transforming For Enduring Growth: ICICI Direct

Reveals mid-term growth plan largely leveraging Kubota’s strengths.

<div class="paragraphs"><p>Material handling equipment manufactured by Escorts Ltd. (Photo: Company website).</p></div>
Material handling equipment manufactured by Escorts Ltd. (Photo: Company website).

BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy. 

ICICI Direct Report

We recently attended Escorts Kubota Ltd.’s analyst meet in Faridabad wherein the company revealed its mid-term business plan. Key highlights, FY28 targets:

  • aspiration to grow revenues to more than 2.5 times of FY22 levels (i.e. ~Rs 22,500 plus crore in FY28E, implied compound annual growth rate of 16.5%+);

  • increase share of exports from ~6.4% in FY22 to ~15-20% in FY28E;

  • target Ebitda margins to mid-teens;

  • return on capital employed at 25-30% and return on equity more than 18%.

  • within segments, agri segment is expected to grow by 2.5 times; construction equipment is expected to grow by two times; whereas railway division is expected to grow by three times by FY28E riding on new products under development.

  • Escorts Kubota also shared firm capital allocation strategy wherein Escorts Kubota will invest up-to 5% of net profit for research and development, innovation for new technologies; cash return to shareholders in the form of dividend plus buyback at up-to 40% of net profit.

Click on the attachment to read the full report:

ICICI Direct_Escorts Company Update.pdf


This report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime.

Users have no license to copy, modify, or distribute the content without permission of the Original Owner.