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Is the CV industry poised for a recovery?

Jun 28, 2013

Equitymaster discusses the factors which impacted the CV industry in FY13 and the outlook going forward

Auto stocks: Are high PEs justified?

Sep 29, 2012

This article discusses whether auto companies with high PE deserve such high price multiples.

Tata Motors: Is the hype justified?

Apr 23, 2012

Equitymaster tries to find out whether the hype in Tata Motors' share price justified

Tata Motors: A play on India's expanding road network

Jun 17, 2011

A profile of Tata Motors, India's largest manufacturer of commercial vehicles and a leading player in passenger vehicles

How to solve the auto puzzle?

Dec 23, 2010

In this article, Equitymaster attempts to help investors to understand the automobile sales trend from a long term perspective

Tata Motors' DVR: What is the fuss all about?

Apr 16, 2010

The discount between Tata Motors' DVR and its ordinary shares has narrowed down in the past one month and there seems to be scope for some more narrowing.

Auto: What happened in March?

Apr 12, 2007

What started off with a gallop has sadly ended with a whimper. We are referring to the auto numbers for the key segments in the month of March. As evident from the table below, most of the major companies across key segments have grown their volumes at a lower rate than what was achieved in the entire fiscal. Let us have a look at the performance of each company and the likely reasons behind the same.

Autos: The month that was...

Feb 8, 2007

If January sales are any indication, auto companies, practically across all the segments have started calendar year 2007 in top gear. With macroeconomic fundamentals remaining strong, companies yet again notched up impressive volume growth. Let us have a look at the performance of all the segments and major companies within those segments during the month of January 2007.

CVs: Cash is the king!

Oct 13, 2005

The commercial vehicle (CV) industry is inherently cyclical in nature. In this article, we shall try to understand whether working capital is an indicator of the cyclical nature of the CV industry and also its impact on financials. For the purpose of this article, we have considered the financial details of Ashok Leyland, as it is not only a pure commercial vehicle manufacturer but also the second largest player in the CV industry. Hence, its performance can be considered as a proxy to that of t

FCCB: Is it beneficial for shareholders?

Oct 4, 2005

In the last two years, almost all the top corporate houses have raised debt (FCCB issue i.e. foreign currency convertible bonds). This has been for the obvious reason of savings in interest costs (by way of lower interest rates). To give a perspective, while the LIBOR rate (rate based on which the interest component is determined in overseas market) is around 3.5%, the prime-lending rate (rate at which the domestic banks lend money) is at about 10%. Indian companies, which raise funds in overse

Auto - Is there 'value'?

Dec 30, 2004

Assuming an investor invested Rs 10,000 each in 10 auto stocks on December 28th 2003, the portfolio would have appreciated by 4% in the last one year. Compare this to the previous year i.e. calendar year 2003 when the same portfolio appreciated by as much as 129% in one year! As we had mentioned in our auto sector outlook at the begining of the year, growth was already factored into the price and is

Auto: Identifying men from the boys…

Nov 24, 2004

Followers of the global auto industry need little introduction about Nissan, the Japanese auto major that is revered in the autobahns of the world for the amazing turnaround story that it has scripted for itself. Much of it could be attributed to its great focus on costs and subsequently its operating margins, believed to be among the best in the world.

Auto: Who’s cashing in?

Nov 19, 2004

With product lifecycles shrinking and an extremely demanding consumer to cater to, auto majors all across the world are facing great strain on their financial resources. On the one hand, while aggressive price wars has meant that growth in topline will be hard to come by, the race to bring out contemporary models on the other hand, is forcing companies to pump more cash back into operations. But where is this cash going to come from?

Four-wheelers: 2QFY05, the segmental story

Nov 17, 2004

While almost all the four-wheeler companies experienced inflationary pressures on their bottomlines during 2QFY05, volume sales continued to experience buoyancy. In this article, let us see how the different segments of the industry performed on the volumes front during 2QFY05 for the companies under our universe.

Tata Motors: The two-diamond glitter

Oct 29, 2004

Tata Motors, India’s largest CV (commercial vehicle) manufacturer, has announced impressive 2QFY05 numbers. Riding on the back of a strong 31% YoY growth in topline, the bottomline has grown at a higher rate of 50%, thanks mainly to a more than three-fold jump in other income and lower tax provisioning. Operating margins however, have come under pressure. For the half yearly period, the growth in topline and bottomline stood at 36% and 74% YoY respectively.

M&M: Two to tango

Oct 28, 2004

Riding on the back of robust volumes sales in both its automotive as well as tractors division, Mahindra & Mahindra (M&M), India’s largest UV and tractor manufacturer has reported a strong 39% YoY growth in revenues in 2QFY05. Growth in bottomline, however, is much higher at 68% YoY, thanks largely to improvement in operating margins and significant savings on the interest front. The corresponding figures for the first half stood at 41% and 96% respectively.

Maruti: No dents for now!

Oct 27, 2004

Maruti, India’s largest passenger car manufacturer, has put up a robust 2QFY05 performance. During the quarter, while the topline has grown by 25% YoY, the growth in bottomline is significantly higher at 48% YoY. Improvement in operating margins and savings on the interest front were some of the other highlights. For the half yearly period, the corresponding figures stood at 24% and 45% respectively.

Ashok Leyland: Margins throw a spanner

Oct 26, 2004

Ashok Leyland, one of India’s leading producers of CV, has faced the heat on the expenses front during 2QFY05. As a consequence, while the topline has grown at a steady rate of 11% YoY, the bottomline has witnessed a fall of 20% YoY in the quarter under consideration. For the half yearly period, the corresponding figures stood at 23% and 10% growth respectively.

Punjab Tractors: Riding the wave

Oct 14, 2004

Punjab Tractors, one of India’s leading manufacturers of tractors has reported robust 2QFY05 results. During the quarter, while the topline of the company has grown at a rate of 49% YoY, the growth in bottomline is even higher at 77%, thanks mainly to improvement in other income and savings on the interest front.

CVs: Tata Motors or Ashok Leyland?

Aug 18, 2004

Owing to robust economic activity and improvement in road infrastructure, the CV industry has seen a sharp spurt in demand over the last three years or so. Given the better economics of road transport vis-à-vis its railways counterpart, the demand is likely to hold itself in the medium to long term as well. Hence, if an investor wants to be a part of the CV growth story, how should one go about it?


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