Escorts spurts after stellar Q3 earnings

Escorts spurted 12.31% to Rs 83 at 11:05 IST on BSE after net profit galloped 215.6% to Rs 58.30 crore on 16.2% growth in net sales to Rs 1172.89 crore in Q3 June 2013 over Q3 June 2012.

The Q3 result was announced after market hours on Tuesday, 13 August 2013.

Meanwhile, the S&P BSE Sensex was up 46.37 points or 0.24% at 19,276.21.

The stock galloped on high volumes. On BSE, 9.90 lakh shares were traded in the counter as against average daily volume of 3.51 lakh shares in the past one quarter.

The stock hit a high of Rs 83.70 and a low of Rs 78.50 so far during the day. The stock had hit a 52-week high of Rs 89 on 19 July 2013. The stock had hit a 52-week low of Rs 48.35 on 28 March 2013.

The stock had underperformed the market over the past one month till 13 August 2013, sliding 13.11% compared with the Sensex's 3.65% fall. The scrip had, however, outperformed the market in past one quarter, jumping 15.92% as against Sensex's 2.35% fall.

The small-cap company has equity capital of Rs 122.58 crore. Face value per share is Rs 10.

Escorts' earnings before interest, taxation, depreciation and amortization (EBITDA) jumped 71.6% to Rs 92.70 crore in Q3 June 2013 over Q3 June 2012. The company attributed the surge in EBITDA to increase in volumes, better product mix and better price realization along with cost saving across all verticals.

Commenting on the company's Q3 results, Mr. Rajan Nanda, CMD, Escorts said, "Management initiatives have focused on entrepreneurial strategies that are opening up new markets, new opportunities and a better profitable presence in the market. At the crux of these consistently strong results over the past few quarters is the strategy of improving volumes and strengthening margins by introducting high power and specialized tractors. The performance is even more noteworthy when seen in the context of the overall economic environment."

Mr. Nikhil Nanda, Joint MD, Escorts said that the Management will continue to remain focused on execution to further improve the operating performance in the months ahead. While the pain point has been the construction sector, there is no denying the ultimate potential of the business, he added. Mr. Nikhil further said that the company sees improvement in the Railways and Auto Products business which is adding to the bottom line.

Escorts is one of India's leading engineering conglomerates. The company has diversified business into four different segments: Escorts Agri Machinery (EAM), Escorts Construction Equipment (ECE), Escorts Railway Products (ERP) and Escorts Auto Products (EAP).

Powered by Capital Market - Live News