HomeMarketsBuy Escorts Kubota, target price Rs 2390: ICICI Direct

Buy Escorts Kubota, target price Rs 2390: ICICI Direct

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ICICI Direct has buy call on Escorts Kubota with a target price of Rs 2390. The current market price of Kubota is Rs 2095.7. Time period given by analyst is one year when Escorts Kubota price can reach defined target.

Escorts Kubota, incorporated in the year 1944, is a mid cap company (having a market cap of Rs 27667.94 crore) operating in auto sector.

Its key products/revenue segments include tractors agricultural, other operating revenue, scrap, sale of services and export incentives for the year ended March 31, 2022.




Financials

For the quarter ended June 30, 2022, the company has reported a consolidated total income of Rs 2067.58 crore, up 6.50 per cent from last quarter total income of Rs 1941.48 crore and up 18.11 per cent from last year same quarter total income of Rs 1750.61 crore. Company has reported net profit after tax of Rs 148.16 crore in latest quarter.

The company’s top management includes Mr.Nikhil Nanda, Mr.Manish Sharma, Mrs.Reema Rameshchandra Nanavati, Mr.Vimal Bhandari, Mr.Kenichiro Toyofuku, Mr.Ravindra Chandra Bhargava, Mr.Shiro Watanabe, Mr.Seiji Fukuoka, Ms.Tanya Dubash, Mr.Yuji Tomiyama, Mr.Dai Watanabe, Mr.Harish N Salve, Mr.Sunil Kant Munjal, Dr.Sutanu Behuria, Mr.Hardeep Singh, Ms.Nitasha Nanda, Mr.Shailendra Agrawal, Mr.Yasukazu Kamada. Company has Walker, Chandiok & Co.LLP as its auditors. As on 30-06-2022, the company has a total of 13 Crore shares outstanding.


Investment Rationale
The stock price has grown at ~26% CAGR over lastfive years from ~ Rs 636 in September 2017, vastly outperforming the Nifty Auto Index.

The brokerage upgrades the stock from HOLD to BUY tracking Kubota’s strength in farm machinery space with key monitorable being medium term growth plan.

Promoter/FII Holdings
Promoters held 72.9 per cent stake in the company as of June 30, 2022, while FIIs owned 4.24 per cent, DIIs 6.2 per cent.

(Disclaimer: Recommendations given in this section or any reports attached herein are authored by an external party. Views expressed are that of the respective authors/entities. These do not represent the views of Economic Times (ET). ET does not guarantee, vouch for, endorse any of its contents and hereby disclaims all warranties, express or implied, relating to the same. Please consult your financial adviser and seek independent advice.



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