India's Escorts Kubota Q2 profit more than doubles on price hikes
03/11/2023 10:36
BENGALURU, Nov 3 (Reuters) - Indian tractor maker
Escorts Kubota ESCO.NS reported a more than two-fold rise in
the second-quarter profit on Friday, as price hikes offset muted
sales.
The company's consolidated net profit climbed to 2.23
billion rupees ($26.8 million) in the three months to Sept. 30
from 988.3 million rupees a year earlier, it said in an exchange
filing.
Escorts Kubota has hiked prices of its agri-machinery
products, which includes commercial vehicles such as tractors,
thrice since the second quarter last year, citing a rise in
commodity and other costs.
The company's revenue rose nearly 9% to 20.59 billion rupees
during the September quarter.
Expenses rose 3.4% in the September quarter, with raw
material costs increasing 2.6%.
Tractor sales fell 7.1% during the quarter as rural demand
was hurt by India's weakest monsoon rains since 2018, leading to
a 4.2% drop in the segment revenue. The tractor business
accounts for nearly 70% of total revenue.
Revenue in the company's smaller construction equipment and
railway equipment segments, however, rose nearly 72% and 29%,
respectively.
Shares of Escorts Kubota rose as much as 1.4% after results.
They settled 0.7% higher on Friday, taking their year-to-date
gains to 43.7%.
Its tractor-making rivals Mahindra & Mahindra MAHM.NS and
VST Tillers Tractors VST.NS will report their results next
week.
($1 = 83.2420 Indian rupees)
(Reporting by Varun Vyas in Bengaluru; Editing by Mrigank
Dhaniwala)
((varunvyas.hebbalalu@thomsonreuters.com;))