Ace investor Rakesh Jhunjhunwala diminished his stake in the farm tools and engineering main Escorts to six.82 per cent from 6.97 per cent.
He diminished his stake on the time when there’s strong traction in the rural economy on the back of a bountiful crop season last year, enhance in the minimal assist price (MSP) and expectation of a plentiful monsoon this year amid wholesome reservoir ranges.
In a regulatory submitting on Friday, Jhunjhunwala said that he bought 2 lakh fairness shares of Escorts on July 22. This takes his shareholding to 91,97,600 shares in the home tractor maker.
Shares of the company outdid the benchmark BSE Auto index with a return of 76 per cent for the reason that starting of the continuing monetary year. On the opposite hand, Auto index recovered almost 54 per cent throughout the identical interval.
The company is but to announce its June quarter earnings. Motilal Oswal Financial Services expects Escorts could post losses in Q1FY21 because the lockdown impacted volumes and led to produce aspect points. The tractor phase was the least impacted indicating decrease stress on the rural aspect.
Of late, the company reported 21.1 per cent enhance in complete tractor gross sales at 10,851 models in June. It had bought 8,960 models in the identical month last year.
The company earlier posted a 9.71 per cent enhance in consolidated internet revenue at Rs 127.73 crore for the fourth quarter ended March 31. It had reported a internet revenue of Rs 116.42 crore in January-March interval of 2018-19.
Edelweiss Professional Investor Research last month gave a ‘Buy’ rating to Escorts with a goal price of Rs 1,332.
“We expect the start of the next tractor upcycle which may last for another 2 years. We believe Escorts will be in a better position to reap benefits of this upcycle like never before,” Edelweiss said.