Escorts Kubota hosted a conference call on Aug 3, 2026. The company was represented by Mr. Bharat Madan, Chief Financial Officer; Mr. Neeraj Mehra, Chief Officer of the Tractor Business Division; and Mr. Sanjeev Bajaj, Chief Officer of the Construction Equipment Business.

Key takeaways of the call

In Q1 FY27, tractor volume stood at 36,862 units, up by 20.5% YoY. Demand was supported by both rural and urban markets. New product launches helped improve market share in Agri products segment.

Going forward, the company plans to launch multiple new tractors to further strengthen its market position.

Construction Volume increased 27.4% YoY to 1,344 units. The outlook for the segment remains strong, supported by higher government investments in infrastructure projects, with the industry expected to grow by around 12-15% in FY27.

Geopolitical uncertainties continue to disrupt supply chains and increase shipping costs.

In Q1 FY27, the EBITDA margin for both Agricultural Machinery Products segment and the Construction Equipment segment fell on a YoY basis. This drop was due to Adverse commodity prices and Change in product mix.

The company remains focused on cost management and operational efficiencies to offset commodity inflation pressures. The company also implemented a 1.5% price hike in the tractor segment and a 6% price hike in the construction equipment segment during Q1 FY27.

Q1 FY27 performance was driven by strong business fundamentals, disciplined execution, and healthy treasury income.

The company expects to outperform the domestic tractor industry, which is projected to grow in mid-single digits in FY27. The growth will be supported by a robust pipeline of new product launches and continued innovation.

Management stated that the company''s 4WD tractor segment continues to grow faster than the industry.

Q1 FY26 included a one-time gain from the divestment of the RED business, as well as an exceptional gain from the sale of land and building. Accordingly, Net Profit After Tax including discontinued operations for Q1 FY27 is not directly comparable with Q1 FY26.

Excluding the impact of the RED business divestment and the exceptional gain, Q1 FY27 Net Profit increased by 26% YoY.

In July 2026, domestic tractor sales were 8,194 units, registering a growth of 23.7% as against 6,624 tractors in July 2025. Growth momentum remained positive in July 2026, supported by steady performance across wholesale and retail segments. Improved rainfall during the month of July reduced cumulative rainfall deficit to 14-15% and Kharif sowing activity picked up pace thereby supporting rural demand and sentiments. Overall rural fundamentals remain resilient. However, Kharif crop and monsoon progression, delayed festive season in Q3, input cost pressures, and the high base effect in the coming months remain key factors to monitor.

Export tractor sales in July 2026 were at 537 tractors registering a growth of 1.3% as against 530 tractors sold in July 2025.

Construction Equipment Business in July 2026 sold 534 machines registering a growth of 49.2% as against 358 machines sold in July 2025. Construction equipment industry-maintained growth momentum in July 2026, supported by a lower base in the corresponding period last year following the implementation of BSV emission norms, along with sustained infrastructure activity and continued government capex.

Going forward, the company expects to remain flat in FY27 and improve in FY28.

The board approved the formation of a Special Purpose Vehicle (SPV) to set up a solar power project for the company''s captive power consumption, with a capital commitment of up to Rs 3.8 crore. The SPV will be incorporated as a private joint venture between Escorts Kubota and Ampin C&I Power, with Escorts Kubota holding a 26% stake.

In Q1 FY27, the company’s domestic tractor volume increased 22.9% YoY compared to industry growth of 18.6% YoY.

In Q1 FY27, the company’s export tractor volume fell 18.9% compared to industry growth of 17.7%. Export through Kubota channel contributed 61% to total Export volume in Q1 FY27.

In Q1 FY27, Less than 40 HP contributed 32% to Agri Machinery sales and Greater than 40 HP contributed 68%.

In Q1 FY27, PNC tractor Volume increased 36.7% YoY. BHL tractor volume decreased 28.4 YoY, Mini Excavator volume increased 40.9% YoY, and Compactor Volume decreased 82.2% YoY.

In Q1 FY27, Agri Machinery Products segment contributed 87% to revenue, and Construction Equipment 13%.

In Q1 FY27, Capacity utilization of Agri Machinery Products segment was around 84% and capacity utilization of Construction Equipment segment was around 47%.

In Q1 FY27, ROE stood at 12.3% on an annualized basis.

Management has guided FY27 capex of around Rs 800 crore, including Rs 400 crore for greenfield investments.