Hold Escorts; target of Rs 680: Geojit
Geojit’s research report on Escorts
Escorts Ltd (EL) is the third largest Agricultural tractor manufacturer in India. It has a strong presence in the north and west market, with an overall market share of 11% as on FY18. Revenue for the Q3FY19 grew by 37%YoY in line with our estimates. This growth was largely led by 34%YoY in the tractor sales & 30%YoY from the construction business.
Considering the near-term pressure on margins, we tweak our EBITDA estimate by -20bps and value EL at 15x FY20E EPS with a revised target price of Rs680 and downgrade our rating from buy to Hold.
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