Escorts: Strong volume growth across its three segments aid Q4 show

Growth and margin profile are expected to be strong in FY19 on rising rural demand, product mix and cost efficiencies

Helped by strong volume growth across its segments of tractors, railways and construction equipment, Escorts reported a 40 per cent year-on-year (y-o-y) jump in revenues for the March quarter (Q4). The performance, marginally lower than estimates, was led by the tractor segment, which accounts for three-quarters of the firm’s revenues and over 86 per cent of the segment’s profits. 

Tractor volumes were up 57 per cent y-o-y, though realisations came in lower compared to Q3, given the launch of products in the lower horse power and compact segments. But, margins for the segment continued to increase, with gains of 500 basis