* Expects FY sales to grow between 8 and 11 pct
* North America sales up 14 pct; international down 1 pct
* Shares fall 3.9 pct as margin forecast unchanged (Adds details from conference call, analyst comment; updates share price)
July 28 (Reuters) - Engine-maker Cummins Inc raised its revenue forecast this year, on the back of increased demand from North American truck makers, but its shares dropped as much as 3.9 percent as investors were unimpressed.
Offsetting the strong home market was a 16 percent fall in Brazilian sales, dragging down overall international sales 1 percent.
"They raised the topline guidance, but did not raise the margin guidance. Therefore, there is somewhat of a disappointment," said William Blair analyst Lawrence De Maria.
The company said it expected revenue to rise 8-11 percent this year, up from a previous forecast of a 6-10 percent gain and broadly in line with analyst expectations.
"Demand is growing in on-highway markets in North America this year as the economy improves and we have gained market share in medium-duty truck and bus markets," Chief Executive Tom Linebarger said in a statement.
However, the company kept unchanged its 2014 forecast for earnings margin, before interest and taxes, of between 12.75 percent and 13.25 percent of sales, citing higher warranty repair costs on its EPA 2013 engines, used in its on-highway trucks.
In the second-quarter ended June 29, revenue from engines for heavy-duty and medium-duty trucks and buses rose 10 and 9 percent, respectively.
Overall sales of engines, which make up three-quarters of revenue, rose 3 percent as the North American strength made up for lower engine sales in Brazil, where truck production is sliding in a weak economy.
Cummins' total revenue rose to $4.84 billion from $4.53 billion a year earlier.
Net income attributable to the company rose 7.7 percent to $446 million, or $2.43 per share.
Analysts on average had expected earnings of $2.38 per share on revenue of $4.83 billion, according to Thomson Reuters I/B/E/S.
Cummins' shares closed down 3.1 percent at $145.35 on the New York Stock Exchange. (Reporting by Mridhula Raghavan in Bangalore; Editing by Maju Samuel and Savio D'Souza)