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Escorts Ltd.

BSE: 500495 | NSE: ESCORTS |

Represents Equity.Intra - day transactions are permissible and normal trading is done in this category
Series: EQ | ISIN: INE042A01014 | SECTOR: Auto - Tractors

BSE Live

Sep 24, 10:36
1483.95 -21.45 (-1.42%)
Volume
AVERAGE VOLUME
5-Day
128,035
10-Day
157,709
30-Day
119,921
34,651
  • Prev. Close

    1505.40

  • Open Price

    1520.00

  • Bid Price (Qty.)

    1484.00 (67)

  • Offer Price (Qty.)

    1484.75 (10)

NSE Live

Sep 24, 10:36
1484.70 -23.70 (-1.57%)
Volume
AVERAGE VOLUME
5-Day
2,379,234
10-Day
1,984,209
30-Day
1,857,832
380,372
  • Prev. Close

    1508.40

  • Open Price

    1514.80

  • Bid Price (Qty.)

    1484.00 (364)

  • Offer Price (Qty.)

    1484.70 (111)

Annual Report

For Year :
2019 2018 2017 2016 2015 2014 2012 2011 2010

Chairman's Speech

The year 2008-09 marks an inflection point for Escorts Limited, from which we are embarking on a well-charted journey of sustained and profitable growth. It also marks the year in which we have redefined ourselves in an important way: from being an agricultural equipment, auto and rail component manufacturing company, we are now poised to become a significant participant in the earth moving equipment arena. As a result, we are now playing a meaningful role within a wider canvas of economic activity by becoming a function of Indias road transportation and real estate infrastructure growth story. Most importantly, this year we proved that we are a resilient lot. During the year, we strengthened the foundation of the Company by serving our customers well and by increasing our operational efficiencies across the board. Operating in a business climate, beleaguered by tough economic conditions, we have proved that by being astute managers of our business and by focusing on fundamentals, one can both, expand market share and generate improved profits in a flat and depressed economic environment. Despite one of the most challenging times, our efforts at strengthening ourselves have reaped rich dividends for your- Company. We registered an 8% increase in our turnover to Rs. 2,158 crores and our EBIDTA increased by 36% to Rs. 207 crores. Today, the Company continues to be identified by our engineering capabilities and innovative ideas. Our research division is churning out more farmer friendly and fuel efficient products. From just being a tractor manufacturer, we are evolving into a complete farm solutions provider by looking at innovative ways of helping farmers unlock economic value. ENRICHING INDIAN FARMERS Since our inception, we have cherished our relationship with Indian farmers. Through our Jai Kisan Swantantra Utasv1 and Jai Kisan Utsav we have saluted the efforts of our farmer friends in their contribution to the nation. Through our initiatives, we have endeavoured to make the Indian farmers Sampoom, Sampann and Swatantra. Our initiatives are in sync with our founding and underlying philosophy of making the farmers more aware, prosperous, secure and satisfied. Our focus is to assist in making a difference in the life of farmers by nurturing them and leveraging on our engineering capabilities to manufacture innovative products, enabling the farmers to generate more returns with less investment. We have a rich heritage of partnering with Indian farmers and have established ourselves as a trusted brand with efficient products. I feel a personal sense of pride and get satisfaction whenever I hear that our farmer friends are satisfied with our products and that our creation has made a positive difference in their lives. FOCUS ON SUSTAINABLE GROWTH Asa part of our transformation exercise we took a decision to focus on sustainable growth. The collective endeavour of the entire organisation has helped to construct a robust performance management system, which resulted in better economic management and reduction in expenditure. This, in turn, has enabled us to trim down our costs, the result being revealed in our increased margins. The focus on quality through our Quality Push Mission was aimed at manufacturing products that were preferred by the customers. This mission drove us to improve our manufacturing efficiencies by eliminating defects and enhancing processes. This exercise resulted in us delivering superior quality innovative products which were aimed at satisfying market demands. I believe that the combined effect of better economic management and desirable products will enable Escorts to reap the benefits of good times and tide over bad times. Our people have been our biggest strength: they have successfully risen to the challenge of revitalising our profitability and growth story. We are already treading on the path to make Escorts a lean and proficient organisation by empowering our people to take the initiative to implement the transition. To achieve best-in- class practices in our operations, we have created systems for collaboration across all the functions. We have allowed our employees to come out with innovative, swifter and improved solutions for our customers. They are also empowered to continuously monitor our systems and processes, creating a proactive work environment where they can challenge and improve themselves on a regular basis. I applaud their passion, commitment and drive to make the Company bigger, betterand stronger. We are also focusing on a pan India presence by increasing our market reach, followed by market share. This initiative will be driven by our price competitive models of global quality norms in terms of technology, performance and durability. The key pillars of our growth strategy will be improved marketing, strong financial systems and controls, innovative engineered products, increased dealer penetration and greater importance on export markets. AGRI MACHINERY BUSINESS During 2008-09, the agriculture and allied activitys growth in GDP declined to 1.6% compared to 4.9% growth in the previous year and 4% in 2006-07. However, this years performance needs to be viewed favourably, considering the high base of the previous years. The share of agriculture and allied activities in nations GDP fell to 1 7.1 % as compared to 1 7.8% in 2007-08. In this scenario, your Company has done commendable business. During the year, the turnover from Agri Machinery Business grew by 7%. The Agri Machinery Business remains the largest contributor to our balance sheet, contributing 87% of the turnover. This year, the Agri Machinery Business scaled new heights by entering new markets and reaching new customers. Your Company leveraged its Knowledge Management Centre by -constantly innovating and creating new products of global quality standards at competitive prices. Escorts is transforming itself from being a tractor manufacture to becoming a complete farm solutions provider. Your Company is reinforcing its commitment to provide technologically innovative products for customer benefit. Our Farmtrac Europe received the best new model award at Polands XVIII National Agricultural Exhibition, the only tractor company to receive this award while our Farmtrac and Powertrac models received first prize at NANE NANE Agricultural show in Tanzania. The Agri Machinery Division recently signed a memorandum of understanding with Haryali Kissan Bazaar, which can aenerate sale opportunities for our products and enable us to facilitate farm mechanisation solutions to 100 rural areas. We launched Humrakshak We Care initiative, a unique insurance policy for farmers to provide them with personal accident cover. CONSTRUCTION EQUIPMENT BUSINESS Amidst the global meltdown that started in 2008 and grew worse through 2009, the answer to sustain Indias growth rate lies in developing the nations infrastructure. Keeping this in mind, the government is targeting major fund allocation over the next two years in the infrastructure sector. Infrastructure Investment Finance Company Ltd (IIFCL) disbursed US$ 640.8 million for various projects during 2008-09. This is in addition to the US$ 320 billion that the government plans to investforthe up gradation of ports, railroads, highways and airports over the next 1 5 years. India is proving to be a huge market for construction equipment business. Escorts is the current global leader in pick-n-carry cranes and 60% of our construction equipment business comes from this. We also enjoy a 25% market share in compactors. During the year, your Company tied up with Hunan Zoomlion International Trade Co. Ltd., China, to bring world-class Truck Cranes and All Terrain Cranes to India. The construction division business is consolidating and strengthening its current leadership position by focusing on technological advancements, introducing new and improved products, and tying up with international manufacturers. The aim of this business is to become a one-stop-shop for providing end-to-end solutions for the construction industry. Although this business is nascent today, it has the potential to grow manifold in the coming years, propelling the growth of your Company. ENGINEERING DIVISION The Companys Railway Equipment Division grew by 39% over the last year to Rs. 195 crores, contributing 9% to the turnover as compared to 7% last year. The Divisions rubber processing unit is playing a key role in producing the divisions future portfolio of products. By offering high- tech components to satisfy the modernisation initiatives of the Indian Railways, the division is equipped to emerge as the front-runner. The Auto industry in India has been hit hard by ongoing global financial recession. Sales figures of the Indian automobile industry have shown upsetting after-effects of global financial slowdown. The recent encouraging economic growth numbers and strong passenger automotive sales indicators are already indicating that the sector is already turning around the corner. Working in its favor, India is blessed with a large emerging middle class population, which is getting economically stronger with every passing day. This class is being touted as potential consumers for Indias auto industry for years to come. Our Auto Suspension Business has been only slightly affected by the drop in auto sales. The revenues of this segment fell down by only 2.7% to Rs. 86.63 crores as compared to Rs. 89.04 crores last year. Your Company has taken adequate measures to get this business back on track and we are confident of robust performance in the near future. GOING FORWARD Building on the various tenets of transformation we have undergone, I expect the growth momentum of your Company to continue into the next decade. The Agri Machinery Groups aspiration is to heighten the much needed agricultural productivity by providing complete farm solutions. The Construction Equipment Division is prepared to continue its escalation story by enhancing its earth moving equipment manufacturing capabilities and product portfolio. The Engineering Division comprising of railway equipments and auto components business is prepared to contribute to the Companys growth momentum by seeking to double its current revenues by 2012. I am indeed fortunate to be at the helm of a talented and motivated management team, each of whom has contributed considerably to bring Escorts to its current position of strength. This young, vibrant and confident team has allowed the Company to look at the future with resolve and purpose as we embark on a journey of Walk the Talk. Today, Escorts is rightfully considered to be an engineering driven organisation, focusing on innovative products to suit customers needs. While we have achieved significant milestones, there is much yet to do. Given our resolve, I am confident of seeing a fully transformed Escorts in the nearfuture, that has mastered the core drivers of long term sustainable growth, standing the test of time in any economy, anywhere in the world. I would like to take this opportunity to thank all the stakeholders for their belief and trust in us. They have encouraged and supported us at every step that we have taken in our journey to create value forall. Rajan Nanda Chairman and Managing Director