Kotak Inst Eqt on Escorts ; Upgrade to Buy, TP Rs 3100

Look beyond near-term weakness 2QFY27 standalone EBITDA came in 10.9% below estimates, due to higher-than-expected employee expenses and higher manufacturing overheads. However, expect co to outperform tractor industry driven by multiple product launches and a favorable geographical exposure Expect margins to gradually recover CY2027E onwards. In addition, construction equipment segment demand momentum remains steady. Diversification into spares, engines and agri-solutions should help broaden the revenue base and reduce cyclicality. Following recent stock price corrections, valuations turn attractive at CMP.

ESCORTS KUBOTA LIMITED

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