Escorts Q3 consolidated net profit drops 32% to Rs 194 crore

Farm machinery and construction equipment major Escorts Ltd on Tuesday reported a 32 per cent decline in consolidated net profit at Rs 193.71 crore for the third quarter ended December 2021, impacted by high base effect and late monsoon rains delaying harvest of Kharif crops.

The company had posted a consolidated net profit of Rs 286.42 crore in the same quarter last fiscal, Escorts Ltd said in a regulatory filing.

Consolidated total income during the quarter under review stood at Rs 2,025 crore, as compared to Rs 2,090.93 crore in the year-ago period.

Tractor sales were at 25,325 units in the quarter, down 19.8 per cent from 31,562 units earlier.

Construction equipment sales were at 1,151 units, down 8.2 per cent, the company said.

Escorts Ltd Chairman and Managing Director Nikhil Nanda said,"The tractor industry has now been impacted for two consecutive quarters due to high base of last year, delayed harvest of Kharif crops owing to late monsoon rains this year which affected the rural cash flows and the retail demand."

Going forward, he said,"We do expect cash flows to improve with better Kharif procurement and positive outlook with good Rabi sowing."

While high inflation remains a concern, Nanda said,"We are hopeful of macro-economic factors to be in favour of agriculture to boost rural demand."

Escorts will continue to invest in new product development and distribution spread to offer enhanced reach and customer experience across domestic and global markets, he added.

On the outlook, he said, "Multiple initiatives in agriculture and infrastructure development focus from the government will be helpful in creating opportunities across our agriculture, construction and railway portfolio.