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Atul Auto: Banking on Alternate Fuel and New Launches - Views on News from Equitymaster
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  • Nov 30, 2016 - Atul Auto: Banking on Alternate Fuel and New Launches

Atul Auto: Banking on Alternate Fuel and New Launches
Nov 30, 2016

Atul Auto has announced the second quarter results of financial year 2016-2017 (2QFY17). While the topline increased by 0.4% YoY, the bottomline increased by 2.5% YoY during the quarter.

Performance summary:
  • Total income increased marginally by 0.4% YoY during 2QFY17. Net sales increased marginally by 0.6% YoY. On the other hand, other operating income declined by 26.2%YoY. Atul Auto sold 11,761 vehicles in 2QFY17 as against 11,925 vehicles in 2QFY16. (a marginal decline of 1.4%) The company has stated that that monsoon in Gujarat was slightly delayed (arrived towards the end of July 2016) and hence monsoon-led demand got delayed. In the month of September, the capacity utilisation was at optimal level and the company manufactured 5,100 vehicles and sold 4,666 vehicles.
  • Operating margins stood at 15.3% during the quarter. Operating profit grew marginally by 0.3%. Atul Auto's gross margin for the quarter stood at 28.4%, the highest compared to the same corresponding quarter in its last 5 years. EBITDA for the quarter increased marginally to Rs. 220 million compared Rs 219 million in 2QFY16 and Rs 87 Million in 1QFY17. EBITDA margins stood at 15.3% which was similar to 2QFY16 however witnessing an increase from 1QFY17.
  • Net profit increased by 2.5% YoY. This is on the back of marginal increase in operating profit, reduction in finance cost and depreciation and an increase in other income. This was partly offset by an increase in tax outgo. PAT Margins stood at 9.7% during the quarter.

    Financial Snapshot (Standalone)
    (Rs m) 2QFY16 2QFY17 Change 1HFY16 1HFY17 Change
    Net sales 1,418 1,427 0.6% 2,477 2,352 -5.1%
    Other operating income 11 8 -26.2% 19 13 -29.1%
    Total Income 1429 1435 0.4% 2,496 2,365 -5.3%
    Expenditure 1,209 1,215 0.5% 2,158 2,058 -4.6%
    Operating profit (EBDITA) 219 220 0.3% 338 307 -9.2%
    Operating profit margin (%) 15.3% 15.3% 13.7% 13.1%
    Other income 4 10 162.2% 8 11 44.7%
    Interest 6 4 -35.7% 7 4 -35.8%
    Depreciation 13 13 -3.8% 27 25 -4.5%
    Profit before tax 204 213 4.5% 313 288 -7.7%
    Tax 69 75 8.4% 107 100 -6.2%
    Effective tax rate 34.0% 35.3% 34.2% 34.7%
    Profit after tax/(loss) 135 138 2.5% 206 188 -8.5%
    Net profit margin (%) 9.5% 9.7% 8.3% 8.0%
    No. of shares (m) 22
    Fully diluted EPS (Rs)* 20.80
    P/E (x)* 21.5

    *Based on trailing 12-months earnings

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