NIFTY 50

Stock 360: Here’s why Escorts is trading at 17x FY22 EPS

Updated : September 28, 2020 05:56 PM IST

The stock price of Escorts Ltd has risen by over 20 percent this month and around 107 percent this year so far. From the 52 week low, it is up 150 percent and it is at its fresh 52-week high and also an all-time high for the stock.

There are a lot of factors behind the rally. The street is betting on the tractor segment recovery to continue. Escorts Ltd expects second-half growth to be about 12 percent. The street is positive on margin expansion in FY22 as well. All this makes it trade at 17 times FY22 EPS.

Now the issue here is for that you are pricing in an earnings growth of about 40 percent.
cnbc two logos
To keep watching CNBC-TV18, India's No. 1 English Business News Channel, call your Cable or DTH Operator and subscribe now for just Rs. 4 per month. You can also subscribe to CNBC-TV18 Prime HD for Re 1/- per month.Find out more
Live TV

recommended for you