Escorts Kubota (ESCORTS) Q1 26/27 earnings summary

Executive summary

• Operating revenue rose 28% year-over-year to INR 3,178.9 crore, with strong growth in both tractor and construction equipment segments.

• EBITDA increased 9.4% YoY to INR 355.4 crore, but margin declined to 11.2% due to commodity cost inflation and supply chain disruptions.

• Net profit from continuing operations grew 4% YoY to INR 387.3 crore; excluding last year's exceptional gain, net profit rose 26% YoY.

• Domestic tractor sales reached a record 36,862 units, up 22.9% YoY, outpacing industry growth and gaining market share.

• Q1FY26 included divestment of the RED business and an exceptional gain, making YoY PAT comparisons not directly comparable.

Financial highlights

• Standalone operating revenue: INR 3,178.9 crore (+28% YoY); consolidated revenue: INR 3,207.6 crore (+28.3% YoY).

• EBITDA: INR 355.4 crore (+9.4% YoY); EBITDA margin: 11.2% (down from 13.1%).

• Net profit: INR 387.3 crore (+4% YoY); EPS: INR 35.2 (vs. INR 33.87 YoY).

• Consolidated PAT up 26.8% YoY to ₹385.9 crore.

• Other income rose 33.3% YoY to ₹207.4 crore.

Outlook and guidance

• Management expects mid-single-digit growth for the tractor industry in FY 2027, with company growth outpacing the industry.

• Export volumes expected to be flat in FY 2027, with growth anticipated in FY 2028 as new markets open.

• Construction equipment industry projected to grow 12%-15% for the year, with company aiming to maintain aggressive market share gains.

• Formation of a solar power SPV is expected to support captive power needs and sustainability initiatives.