Why Escorts Is On The Verge Of Major Growth Path


In recent quarter, Escorts indicated to Investor community that they have done the transformation through innovating product line. The different business unit of Escorts such as Heavy Machinery, Agricultural Tractors, Hydraulic Mobile Cranes, Farm Equipment's and Railway suffered downturn from 2013 to Early 2015 and forced the organisation to change their strategy on the Research development to Product development to market positioning. The pain went out of control post last two year of draught and slow economic growth.

The continuous effort by the Promoter group and relentless effort by its Product and Sales team turned the company in the last two quarter. For the past few months Escorts is showing positive sales report on their management is positive about the sales growth and expect the sales growth to be in the range of 15 plus % point year on year.

The stock price in the last few months shouted upwards and also attracted the best investor Rakesh Jhunjhunwala eye who bought good chunk of equity at lower price.

With very good monsoon trend in North India where Escorts is having very strong footing, I will not be surprised that they gain market share and achieve more than 20 % y-o-y growth path. The cost optimization also helped them to improve their cash flow and profitability. I expect that equity price will easily give 30 to 40 % in next 6 to 9 month. It's a must have equity for all retail investor. I call these kind of companies as pension companies. Given their market cap, I must highlight that their land properties is more or less value the market cap of the company.

Disclaimer - Please consult your financial advisor

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Visionary Leader with 22 years of multi-functional experience - combine astute tactical, strategic, business, technology and industry skills in ICT domain at domestic and international level (Wired/Wireless/ networks /platforms/ connected device) .... More

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