Rs 4,500 Crore Project: Rakesh Jhunjhunwala’s Portfolio Multibagger Stock In Green As Company To Set Up New Tractor Manufacturing Plant In Uttar Pradesh
The stock gave multibagger returns of 715 per cent in 5 years and a whopping 3,160 per cent in a decade.
Escorts Kubota Limited is actively seeking to expand its manufacturing capabilities. The company has submitted a proposal to the Uttar Pradesh government to acquire approximately 250-300 acres of land for setting up a new manufacturing facility. This Greenfield project is estimated to involve a substantial investment of around Rs 4,500 crore in phases and is expected to generate annual revenue exceeding Rs 10,000 crore upon full operation. The facility will create employment opportunities for over 14,000 people. The company plans to utilize a portion of the land for increasing tractor and engine production, while the remaining area will be reserved for future growth initiatives. The project is slated to commence in 2028 and will be funded through proceeds from a previous share issue to Kubota Corporation and internal reserves.
To accommodate its growth strategy, Escorts Kubota currently operates at 66 per cent capacity utilization with a total production of 1.70 lakh units (including its joint venture). The proposed expansion aims to address the company's rising demand in both domestic and global markets. It's important to note that the details of the project are still being finalized and will be communicated in due course. The company is also awaiting approval for the merger of its joint venture, Escorts Kubota India Private Limited, with the parent company.
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About the Company
Escorts Kubota Ltd is a leading Indian engineering conglomerate primarily focused on manufacturing agricultural machinery, construction equipment and railway components. The company's core business of agri-machinery, contributing 70 per cent to FY24 revenue, involves tractors, engines and related products. Construction equipment, growing in importance, accounts for 19 per cent of revenue and includes material handling, road compaction and earthmoving equipment. Railway components make up the remaining 11 per cent.
Today, the shares of the company gained 0.6 per cent to Rs 3,751.10 per share from its previous closing of Rs 3,729.55 with an intraday high of Rs 3,755.25 and an intraday low of Rs 3,710. The stock’s 52-week high is Rs 4,410.40 and its 52-week low is Rs 2,647.45. A prominent investor’s portfolio (Rakesh Jhunjhunwala) held a 1.58 per cent stake in the company. Following his passing, these shares have been transferred to the Demat account of his wife, Rekha Rakesh Jhunjhunwala. The stock gave multibagger returns of 715 per cent in 5 years and a whopping 3,160 per cent in a decade.Investors should keep an eye on this Large-Cap stock.
Disclaimer: The article is for informational purposes only and not investment advice.
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