Escorts Kubota aims for Rs 22,500 crore in revenue by FY2028

The company's future growth plans include four new high-volume markets: the United States, Europe, Thailand, and Brazil.

Escorts Kubota, India's third-largest tractor manufacturer, intends to accelerate farm growth over the next five years. Its new Mid-Term Business Plan outlines the company's ambitious goal of increasing revenue by 2.5 times to Rs 22,500 crore over the next five years, primarily by establishing India as an export hub for affordable tractors.

Escorts Kubota wants to rank number two in the Indian tractor market, Escorts Kubota aims to be the largest tractor exporter. This goal will be accomplished by constructing a new plant and increasing production by increasing production, leveraging global presence, and becoming a hub for global parts sourcing.

The company currently ships tractors to Europe and has recently expanded to South Africa and Sri Lanka.

The company's future growth plans include four new high-volume markets: the United States, Europe, Thailand, and Brazil. Exports, like the domestic market, could potentially increase by 2 to 3 times and account for 15-20% of total revenue by FY2028. Escorts Kubota will capitalize on Kubota's strong presence in key markets such as North America and Europe, where it has approximately 1,200 and 3,00 dealers, respectively.

The company intends to invest Rs 4,000 crore in new capital over the next five years (2023-2028). The Escorts Kubota focus would be on increasing market share in India through new product launches.

Using a 'Glo-Cal' Method

The 'Glo-Cal' strategy aims to target both global and local market operations. In addition, Escorts Kubota aspires to be the largest made-in-India tractor exporter. They also intend to be the domestic market leader in combined harvesters and rice transplanters by 2028.

Another strategic goal outlined in Escorts Kubota's Mid-Term Business Plan is to be the second largest tractor manufacturer in India's tractor and farm machinery market. This means it will become a competitor to Mahindra & Mahindra, the domestic market leader. If it achieves its goal, it will control one-fifth of the Indian tractor market.

The goal is to design and manufacture high-quality, low-cost tractors and farm machinery in India and around the world. The company is optimistic about its future growth, and it believes it will benefit from its collaborations with low-cost manufacturing facilities of Escorts and the diverse global presence of major Japanese Kubota. Then there are world-class practices and cutting-edge R&D facilities. The company's goal is to develop low-cost, high-quality farm machinery and tractors both globally and in India.

To achieve its aim, the company plans to increase tractor and engine production capacity by more than 76% by the fiscal year 2028. The existing capacity of 170,000 units per year will be increased to 300,000 units per year with the help of greenfield units.

Over the next five years, Escorts Kubota expects 1.5 to 3 times growth in portfolio expansion across all three tractor brands - Powertrac, Farmtrac, and Kubota - with products ranging from 15hp to 110hp. As a result, the company's market share will rise from 12% to 18-20% by FY2028.

Expanding the Company's Exports

Escorts Kubota intends to increase export volumes because India serves as a low-cost manufacturing base for global markets. According to the company's management, even a 5% shift in total purchasing of components sourced globally to India would result in approximately US$ 500 million (Rs 4,081 crore) in potential exports.

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