Escorts Kubota: Tractor guidance upgraded to mid-single digits for FY27

Research evidence excerpt

Escorts Kubota: Tractor guidance upgraded to mid-single digits for FY27

J P M O R G A N Asia Pacific Equity Research

04 August 2026

Escorts Kubota Neutral

ESCO.NS, ESCORTS IN

Tractor guidance upgraded to mid-single digits for FY27 Price (03 Aug 26):Rs3,135.50

▲Price Target (Dec-27):Rs3,400.00

Prior (Dec-27):Rs3,240.00

Escorts’ operating results were a beat (see our First Take here), driven by better-

than-expected margins in the Agri business, while construction equipment margins India Automobiles, Auto parts,

Airlines and Leisurecame in lower than JPMe. Management has increased its FY27 tractor industry

growth guidance from flattish (range of +2% to -2% YoY) to MSD (in line with 5% Amyn Pirani AC

guidance by M&M). The company believes that it will grow more than the industry (91-22) 6157-3583

amyn.pirani@jpmorgan.com

on the back of multiple launches planned in coming months across core, premium,

and application-specific markets. We are increasing our volume forecasts for Harshit Mittal

(91-22) 6157-3152

FY27E-29E by 2-4%. Our FY27E-29E EPS see minimal revisions of -1 to 2% as harshit.mittal@jpmorgan.com

we cut our EBIT margins by 40-70bps. We remain Neutral with a new price target J.P. Morgan India Private Limited, J.P. Morgan

of Rs 3,400. The stock trades at 21.3x FY28E P/E vs. MM at 19.3x. Tower, Santacruz(E), Mumbai - 400098, SEBI Registration: INH000001873, (91-22) 6157-3000.

Key takeaways from the management call:

Style Exposure

• Management has increased its FY27 tractor industry growth guidance from flat

(range of +2% to -2% YoY) to MSD.

• Management provided FY27 export guidance to be flattish overall with Q1

shortfall expected to be recovered across remaining quarters; FY28 is expected

to improve with potential North America opening up