Target: ₹3,530

CMP: ₹3,148.80

The Agri Machinery segment delivered a strong performance in FY26, with Escorts Kubota reporting its highest-ever domestic tractor volumes of 1,26,994 units, up 14.9 per cent y-o-y, supported by healthy rural demand, government support measures, and strong traction in Southern and Western markets. However, the industry growth of 23.4 per cent outpaced the company due to Escorts’ relatively lower presence in high-growth regions.

To bridge market gaps and strengthen market share, the company launched 13 new tractor models during the year, including “Paddy Special” tractors targeted at Southern markets. The non-tractor farm machinery business continued its strong momentum, delivering over 35 per cent CAGR over the past three years, while management remains confident of sustaining over 20 growth over the next three years.

The export business witnessed strong acceleration in FY26, with tractor export volumes rising 33.8 per cent y-o-y to 6,676 units, significantly outperforming the broader industry growth of about 7 per cent.

Management remains focused on long-term growth through new product launches, localisation, export expansion, captive financing, and planned greenfield expansion. However, management expects the domestic tractor industry to remain broadly flat in FY27 amid a high base, commodity inflation, and monsoon-related uncertainties.

We continue to maintain our Hold rating on the stock with a target price of ₹3,530 (earlier: ₹3,590)

Published on May 8, 2026