InvestorQ : Why explains the sharp growth in profits of Escorts for the Dec-20 quarter?
Mary Joseph made post

Why explains the sharp growth in profits of Escorts for the Dec-20 quarter?

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Arusha Ray answered.
4 months ago
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Escorts reported 23.8% growth in sales for the Dec-20 quarter at Rs.2,042 crore. If you look at the business verticals, tractors and agri-machinery grew by over 27% and construction equipment division also saw growth. However, the railway equipment vertical saw a sharp fall on a small base, due to the railways being shut for most part of the period.

Operating profits improved on inventory management efficiency locking up less funds in working capital. OPM expanded from 11.25% to 16.20% in Dec-20 quarter. PAT of the company was up 85% at Rs.286 crore as the operational advantages got transmitted successfully to the profits, despite higher tax liability. PAT margins improved from 9.38% to 14.02% in the Dec-20 quarter.

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