ESCORTS - Fundamental Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Fundamental Rating: 4.1

📊 Financial Strength & Performance

Quarterly PAT: ₹274 Cr (↓ slightly from ₹288 Cr) — indicates stability, though not a growth driver this quarter.

ROCE (13.6%) & ROE (12.8%): Decent but below high-efficiency peers; reflects capital conservatism.

Debt-to-Equity (0.01): Near debt-free — financial resilience, especially in cyclical sectors.

EPS (₹113): Strong earnings, supports market valuation at current levels.

💵 Valuation Indicators

Metric Value Interpretation

P/E Ratio 30.9 Undervalued vs Industry PE (41.3)

P/B Ratio ~3.76 Reasonable premium over book value

PEG Ratio 1.52 Fair valuation relative to expected growth

Intrinsic Value — Likely near ₹3,600–₹3,900 range based on earnings

Price seems fair with mild upside potential. Not overly stretched, but not deep value either.

🚜 Business Model & Competitive Advantage

Sector: Agricultural machinery (tractors), construction equipment, and railway components.

Strengths

Diversified product portfolio.

Strong rural distribution and branding.

Near debt-free balance sheet allows for operational flexibility.

Risks

Seasonal agri demand dependency.

Margin sensitivity to raw material prices.

Institutional Sentiment

FII ↑ 0.01%

DII ↑ 0.09% — marginal bullish positioning

📈 Technicals & Entry Zone

Current Price: ₹3,490

DMA 50: ₹3,351 | DMA 200: ₹3,362

RSI (62.8): Slightly overbought — nearing reversal territory

MACD (36.5): Strong bullish momentum

Volume: Surge — potential breakout underway

🔍 Suggested Entry Zone: ₹3,300–₹3,400 Prefer accumulation near 200-DMA, especially during mild pullbacks.

📌 Long-Term Outlook

ESCORTS is a solid long-term candidate if you're betting on rural infrastructure, mechanized farming, and construction uptick. The company's low debt, robust EPS, and improving valuation metrics offer decent compounding potential. Keep tabs on monsoon season forecasts, rural demand trends, and government subsidies for agri equipment — these factors often drive stock performance in this sector.

Want a comparison with peers like Mahindra or VST Tillers next? Or maybe a dividend yield screen across mid-cap agri stocks? Let’s dig deeper!

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