Escorts Kubota Ventures into Financial Services, to Launch NBFC with Rs 700 Crore Authorized Capital

Kubota, a prominent player in the engineering sector specializing in farming and construction equipment, has announced its strategic foray into the financial services domain by establishing a Non-Banking Financial Company (NBFC) with a substantial authorized capital of Rs 700 crore.

Diversification Strategy:

The decision to venture into financial services aligns with Escorts Kubota's broader strategy to diversify its business portfolio and cater to the growing financial needs of its customers. The move aims to bolster the accessibility of financing options for its diverse range of products, including agricultural and construction equipment.

Board Approval for Capital Infusion:

The Board of Directors of Escorts Kubota has also granted approval for capital infusion into the NBFC, amounting to a significant sum of up to Rs 200 crore. This capital injection will be executed as and when required, in accordance with the business plan and operational requirements of the newly established entity.

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Supporting Customer Financing Needs:

The primary objective of the newly formed NBFC is to facilitate financing solutions that cater to the financial requirements of both the company's product offerings and its valued customers. Escorts Kubota aims to streamline the financing process, ensuring that customers have access to affordable and convenient financial options.

Regulatory Approvals and Timeline:

The establishment of the NBFC is contingent upon obtaining the necessary regulatory approvals from the Ministry of Corporate Affairs (MCA), the Reserve Bank of India (RBI), or any other relevant Statutory Authority. Subject to regulatory clearance, Escorts Kubota anticipates that the indicMinistry of Corporate Affairsative timeline for the completion of this strategic initiative will extend to July 2024.

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A Transformative Step:

This strategic move into the financial services sector marks a transformative step for Escorts Kubota. By diversifying its business operations into the NBFC domain, the company aims to fortify its position as a comprehensive solutions provider in the farming and construction equipment segment. It underscores Escorts Kubota's commitment to enhancing the overall customer experience by offering a more holistic suite of services.

As Escorts Kubota embarks on this new journey, it holds the potential to make a significant impact on the accessibility of financing options for farmers and construction professionals. Additionally, it strengthens the company's position in an ever-evolving market, positioning it to better serve the evolving needs of its customers while contributing to the growth of the farming and construction sectors in India.

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