Hold Escorts, says Phani Sekhar

Phani Sekhar of Angel Broking told CNBC-TV18, "One can continue to hold Escorts. The prospects for tractor industry looks good and with the kind of political discourse that you are hearing through the mainline, mainstream parties, it is quite evident that agriculture will be one of the focus areas with any kind of dispensation that comes into power, which is good news for tractor makers because of the increasing farm mechanisation that one is likely to see. The only concern or a challenge for Escorts will be to maintain its market share in its bread and butter business which is between 31HP to 50 HP because it derives 93 percent of its volumes but enjoys just 12 percent market share out there which means that it is vulnerable to competition."

He further added, "The stock has run up a lot in recent times. It is also trading at the higher end of its trading band. Considering the fact that the land monetaisation prospects at this point in time are not very certain, the return ratios are not very encouraging. Any chances for further re-rating don’t look very promising at this point in time. So, it will be a good idea for the investor to hold on and maybe if the stock gives opportunities on the lower end then one can accumulate more."