Escorts targets mid-term growth in construction equipment biz
In FY'19, company's total volumes of manufactured and traded products increased by 23.6% to 5,544 units against 4,486 in the previous fiscal
Faridabad-based farm and construction equipment maker Escorts expects to achieve mid-term growth in the sales performance of its construction equipment business, company's CMD Nikhil Nanda said in the latest annual report.
In FY'19, company's total volumes of manufactured and traded products increased by 23.6% to 5,544 units against 4,486 in the previous fiscal. As per the report Escorts recorded highest-ever EBITDA of Rs 733 crore in FY'19, up by 31.6% vis-à-vis Rs 557 crores in the previous fiscal.
"Our EBIT margin for the year ended March 2019 stood at 3.6%, up by 166bps vis-à-vis 1.9% in the previous fiscal. Barring challenges on account of financing issues and an uncertain global environment, we expect to improve our margin in FY 2019-20. Going forward, we also expect that our construction equipment business will continue to grow in mid-teens in the medium- to long-term, " Nanda said.
He further added that going forth the company will be launching an exciting array of innovative products in this segment.
Escorts, which is a Rs 6,262 crore company, has recorded 22.6% increase in the volumes of backhoe loaders, pick ‘n’ carry cranes and compactors in the last fiscal. Sales of cranes showed a significant jump of 26% followed by backhoe loader that grew by 22.2% and compactors that witnessed a growth of 20.5% in FY'19.
In 2019, the company signed a joined venture with Japan-based manufacturer of cranes and aerial work platforms Tadano to produce specialised cranes that address high capacity use cases.