Beating inflationary pressures in the automobile industry, tractor manufacturer Escorts Ltd today reported a net profit of Rs 9.31 crore for the third quarter ended June 30, against a net loss of Rs 6.24 crore in the same period last year.
The total income during the third quarter rose by 5.30 per cent at Rs 542.83 crore, compared to Rs 515.50 crore in the year-ago period, the company said in a statement.
"Escorts has turned in a good performance under difficult market conditions. What is particularly heartening is that the agri-machinery business has registered strong growth both in the topline as well as profitability in the quarter," Escorts Ltd Chairman and Managing Director Rajan Nanda said.
The company's market share has grown despite difficulties in the market and it has planned to further strengthen sales and marketing efforts and introduce new products, he added.
"Public Sector retail finance for tractors continues to be sluggish and of concern. Its sales are dependent upon loan sanctioned by state-run banks and is imperative for the government to send strong signals to the banking sector to significantly step up lending," Nanda said.
The additional challenge is from the general inflationary environment, with prices of critical raw materials such as steel increasing three times in the last six months, he added.
"The overall impact on the economy of rising oil prices and concomitant inflation is bound to have a general impact sooner than later," Nanda said.