See 7-8% volume growth in Q4 as low base to help: Escorts

Tractor maker Escorts is hopeful of a 7-8 percent volume growth in the March quarter, says Bharat Madan, the company's Group Financial Controller, adding that it would be helped by a low base effect.In an interview to CNBC-TV18, Madan says the 12 percent volume growth during November was on expected lines, and that the long term visibility of the equipment business appeared weak.Below is the verbatim transcript of Bharat Madan's interview with Latha Venkatesh and Sonia Shenoy on CNBC-TV18.Latha: Is this a U-turn that we can read into after several months and in quarters of contracting growth? November seems to have been showing a reversal.A: It was on the expected lines because we had seen the festival season shifting slightly in this quarter.Latha: You think December is as good?A: We are expecting that December onwards things should start improving. So in our opinion the industry has touched rock-bottom so I think we should start looking up from here.Sonia: When you say growth will be visible, what kind of growth are you forecasting because year-to-date (Y-T-D) your total sales are still down about 20 percent, for the rest of the year, what kind of growth do you see at best?A: For this quarter probably we expect it to be more or less flattish now with the November growth but Q4 we are still expecting growth is possible because the base is pretty low. Last year the industry had went down. So we expect there will be some recovery which will happen in Q4 merely because of the base effect and that will lead to the overall industry probably still be down in this year by about 10 percent compared to last year. But at least that de-growth scenario would have probably been put to an end. So some minor growth of 7-8 percent sort of thing we start expecting on this.Sonia: What about your construction equipment business because over there it continues to post losses. In the first half we have seen Rs 16 crore of losses in that business and now it has been de-growing for almost 4-5 years, when can we expect to see some sort of realistic turnaround?A: We hope Q4 normally is good for the industry. So we expect Q4 to be slightly better in terms of numbers but in the long-term still the visibility of the improvement on the equipment space still is not there. So next year we will see some improvement hopefully but we cannot see anything now on that space.