Annual Report Highlights FY12-13 - Atul Auto

Image courtesy of Nutdanai / FreeDigitalPhotos.net

Company had a volume growth of 19% and value growth of 22%.   Net profit growth was at impressive 66% due to economies of scale.   Company has introduced another new product called Atul Gemini DZ which is a diesel variant.  Company now has Atul Shakti, GEM, Smart and Gemini.  Company caters to both cargo segment and passenger segment.  Company has installed capacity of 48000 vehicles as off date. Company is improving its dealers and distribution network.  It has 150 exclusive dealers, more than 100 sub dealers, 14 regional offices and 3 trg centers in 16 states.  Margins have improved and company is now debt free.   Capital expenditure has been normal.  Company sells around 32000 autos in a year currently.  So, there will not be any immediate capex for next 2 to 3 years atleast in my opinion. Sales and general admin expenses have come down this year compared to last year which increased the margins.  Company now supplies Petrol, Diesel, CNG and LPG variants. 

Overall 3 wheeler segment is grew at only 4.87% domestically and there was a sharp de-growth of -16% in exports.  Atul was able to grow only because of entry into new geographies in domestic market and increasing dealership network.

Company cash flow has been very good and they have paid down their debt and brought it to zero.  Cash flow has been consistently above the net profit reported for the last two years.

They have been providing lesser than actual utilization towards warranty and after sales service claims.  This could mean lower profits in the future unless they have improved their quality which would bring down the actual spend.

Advance from Customers have come down compared to last year which may mean lesser demand compared to last year.

Atul Gemini and Atul Shakti seems to be growing compared to last year and form major part of revenue contribution.   Atul Smart has dropped in value compared to last year.  Atul Gemini has been introduced recently and just picked up on sales.

Overall feeling is that currently it is growing due to new products and new geographic entry.  It will soon slow down to be in line with industry.  Month on Month volume increase should be closely monitored from here on.