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Escorts Kubota hosted a
conference call on May 9, 2024. In the conference call, company was represented
by- Mr. Bharat Madan: Chief Financial Officer, Mr. Neeraj Mehra: Head of
Farmtrac & Powertrac Sales and Mr. Sanjeev Bajaj: Chief Officer of
Construction Equipment Business.
Key takeaways of the call
In Q4 FY24,
tractor volume stood at 21.253 units, down by 14.2% YoY. In FY24, tractor
volume stood at 95,858 units, down by 7.2% YoY.
In Q4 FY24,
Agri segment EBITDA margin improved driven by softening in commodity prices,
better realization and cost control measures.
Management
expects domestic tractor industry to do better in H2 FY25.
In Q4 FY24,
company’s domestic tractor volume fell by 13.7% YoY compared to industry
de-growth of 18.9% YoY. In FY24, company’s domestic tractor volume fell by 5.3%
YoY compared to industry de-growth of 7.4% YoY.
In Q4 FY24, Company’s
export tractor volume registered fall of 20.4% compared to industry growth of
6.5%. In FY24, export tractor volume registered fell 30% compared to industry
de growth of 21.4%.
In FY24, Farmtrac contributed 44%
of Agri Machinery sales and Powertrac 56%.
In FY24, Less than 40 HP
contributed 36% to Agri Machinery sales and Greater than 40 HP contributed 64%.
Company had more than 1,200
exclusive dealers for EKL brand of tractor in India at end of March 2024.
In Q4 FY24,
construction Volume increased 17.5% YoY to 1798 units. In FY24, construction
Volume increased 42.2% YoY to 6548 units.
EBITDA
margin of Construction Equipment segment improved driven by higher volume,
better product mix and better price discovery.
In Q4 FY24,
railway revenue decreased 10.1% YoY to Rs 213.4 crore. In FY24, railway revenue
increased 12.9% YoY to Rs 950.4 crore.
Order book
for the railway division, at end of March 2024, was approx. Rs 950 crore.
Management
expects railway division to sustain its double-digit growth in FY25.
For
FY24, Capacity utilization of EAM (Escorts Agri Machinery) segment was
around 80% and capacity utilization of Construction Equipment segment was
around 70%.
In
Q4 FY24, Capacity utilization of EAM segment was around 75% and capacity
utilization of Construction Equipment segment was around 80%.
During the quarter ended March 2024,
BHL (Backhoe Loader) industry went up 16.7%, PNC (Pick & Carry Crane) industry
up by 39.5% YoY and Compactors Industry up by 31.5% YoY.
Going forward, the company intends
to focus more on northern and western parts of India for increasing tractor
volumes.
Board recommended
a dividend of Rs 18 per fully paid-up equity share of Rs 10 each for the
financial year 2023-24.
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