ICICI Direct's research report on Escorts Kubota
The company is a prominent tractor maker domestically (10.3% FY22 market share). It also serves domestic construction equipment, railways space. FY22 sales mix – tractors 77%, construction equipment 14%, railways 9% • Kubota (Japanese company), a co-promoter with effective stake at 53.5%.
Outlook
We retain BUY rating amid wider opportunity at play with Kubota coming on board as co-promoter and strong financials amid healthy RoCE targets. Revising our estimates, we now value Escorts Kubota at SOTP-based TP of Rs 2,365 (25x P/E on core FY24E EPS; earlier TP of Rs 2,330).
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