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Indian tractor maker Escorts Kubota Ltd reported a smaller-than-expected third-quarter profit on Thursday, as lower demand offset the fall in costs.

The company's standalone net profit rose nearly 49% to 2.77 billion rupees (about $33 million) for the three months ended Dec. 31, but fell short of analysts' expectations of 2.82 billion rupees, per LSEG data.

India's festive period was a mixed one for tractors, analysts said. Uneven and below-normal rains towards the end of quarter also did not help.

Tractor demand in India eased due to delays in crop harvesting and sowing. Escorts sold 25,999 tractors in the third quarter, down 7.2% from a year ago.

Revenue rose 2.5% to 23.20 billion rupees, the slowest growth since at least March 2022.

The agri-machinery products segment, which accounts for more than 70% of total revenue for Escorts Kubota, fell 2.9% in the quarter.

Proceeds from the smaller construction equipment segment rose 49.4%, while that from railway equipment fell 17.8%.

Cost of materials consumed, which form the majority of total expenses, fell nearly 8% to 12.93 billion rupees.

Larger rival Mahindra and Mahindra Ltd is set to post its quarterly earnings next week.

($1 = 82.9640 Indian rupees)