Escorts Kubota (ESCORTS) Q3 25/26 earnings summary

Executive summary

• Q3 FY26 saw strong revenue and profit growth, with standalone operating revenue at INR 3,261.4 crore, up 11.1% YoY, and EBITDA at INR 438.7 crore, up 30.9% YoY, marking the highest ever quarterly EBITDA.

• Net profit from continuing operations reached INR 362.4 crore, up 24.7% YoY; adjusted for a one-time labor code impact, net profit was INR 401.6 crore, up 38.3% YoY, the highest ever quarterly PAT.

• The board declared a one-time special dividend of INR 18 per share following the railway business divestment.

• The company completed the sale of its railway equipment division and integrated two Kubota entities, impacting reported figures.

• Approved phased investment for land acquisition and a new greenfield plant to expand production capacity.

Financial highlights

• Consolidated revenue from continuing operations was INR 3,280.5 crore, up 11.3% YoY; consolidated EBITDA was INR 434.7 crore with a margin of 13.3%, up 91.96 bps YoY.

• Reported consolidated net profit was INR 358.3 crore, up 11.8% YoY; normalized profit (adjusted for labor code) grew 38.1% YoY.

• EPS including discontinued operations stood at INR 32.93, up from INR 29.39 YoY.

• Exceptional expense of INR 52.46 crore in Q3 FY26 due to new labour code implementation.

• Gain of INR 75.99 crore in the nine months ended December 31, 2025, from sale of land and buildings.

Outlook and guidance

• Tractor industry momentum is expected to sustain, with the domestic industry likely to reach a new peak of 11.5 lakh units in FY26, supported by favorable agri conditions and government policies.

• Export momentum is expected to continue with double-digit growth, though not at the recent high rates.

• Construction equipment segment shows early signs of stabilization, with expectations of gradual improvement as infrastructure projects are awarded.

• Greenfield project to enhance tractor capacity by 60,000 units and construction equipment by 15,000 units per annum within 7 years.

• Management highlights continued focus on operating leverage, product mix improvement, and cost control.