old city walled area of ahmedabad regeion
the autowala came to supply wood at my place at ahmedabad
expected 10% linear growth for a small cap company is not that good
looking forward to future growth drivers
Aug13 volume sales 3204
aug 12 voluem sales 2322
38% growth where companies like m&m showing decline.
bajaj auto numbers yet to come.
excellent performance. jul13 had seen 20% yoy growth.
Great numbers from Atul Auto. I am not sure if we would see an asymmetric growth in profits this year vis-a-vis the growth in sales though (unlike last year). Very little operational leverage might be left to be squeezed.
Just to provide an update on the number of dealers - in about 4 months since the last update, there have have been 11 additional dealer locations, with the largest increase in Maharashtra (4), followed by Orissa and Kerala (2 each). One dealer location seems to have been closed down in Rajasthan. Total number of dealers at 180, compared to 169, 4 months back. Here's the split -
| May 10th, 2013 | Sep 4th, 2013 | ||
| State | Number of Dealers | Number of Dealers | Increase/Decrease |
| Assam | 2 | 2 | 0 |
| Andhra | 20 | 20 | 0 |
| Bihar | 11 | 12 | 1 |
| Chhatisgarh | 3 | 3 | 0 |
| Gujarat | 23 | 24 | 1 |
| Haryana | 4 | 4 | 0 |
| Himachal | 1 | 1 | 0 |
| J&K | 3 | 3 | 0 |
| Jharkhand | 8 | 8 | 0 |
| Karnataka | 9 | 10 | 1 |
| Kerala | 15 | 17 | 2 |
| MP | 12 | 12 | 0 |
| Maharashtra | 16 | 20 | 4 |
| Orrisa | 7 | 9 | 2 |
| Punjab | 5 | 5 | 0 |
| Rajasthan | 10 | 9 | -1 |
| UP | 20 | 21 | 1 |
if co able to appoint dealer in all area such as mah have 39 district place and they have only 20 dealer in Maharashtra itself co can double the franchise sales can grow min 30% .
1st and for most trigger for growth is franchise expansion.
so there is huge opportunity in front of company how they caters it is most imp thing.
Thanks, Kiran. Any chance you have product wise units / revenue figures for the latest quarter or the preceding one?
@Kiran - yes, the co has done pretty well in this month and this dealer data is very interesting 
If these guys are able to increase dealer network and penetration, the nos will automatically come.
When they get approval/launch of the petrol product, the export market would open up for them. Hence its interesting to see that the product expansion is happening along with increasing of dealer network.
Ayush
Hi all,
Having just gone through the forum discussion on Atul, I must confess that the level of research of fellow value pickers is truly impressive. It has indeed been a rewarding experience. I first got interested in the stock sometime in mid 2011, have been gradually adding to my position ever since n have accumulated a decent qty. It has been a wonderful ride & the gains from it has helped me take care of the numerous mistakes that all of us stock pickers tend to make!
I expect Atul to manufacture close to 40,000 units this year, with an EBIT of abt 48crs. & PAT of abt 33 crs. The second half of the year is generally much better, though this time even Q2 promises to be very good. Q1 has been some what disappointing, though it is traditionally a week qtr. The salary hikes have made it worse. I suspect that the âother expensesâ may have a one time expense as well. You guys are already aware of itâs debt free status n high Div pay out ratios. What is most attractive abt Atul is its very high return ratioâs. For 2012-13 it had an average return on capital employed of abt 57%. Itâs not common to find Co.'s managing their finances as efficiently.
I expect to see much higher levels in six months. Iâll stick my neck out n say that weâll see Rs. 250 atleast once by March. For next 18 months, my target is much higher!! For all Value pickers, debating about adding to their positions, I suggest go for it. Current level of 175-180 presents a great opportunity. Please donât be in a hurry to exit with a small gain. Keep it for 18 months n weâll all celebrate!
(Like all share holders, I too have a vested interest in the stock going up!)
Hi Rajeev,
Have you talked to customers about the product?
A friend inquired in his city & there the response wasnât good.
Hi Jatin,
A friend of mine spoke to some drivers in Delhi side, there the response is pretty good and they are satisfied.
Can more members of our forum try to take this ground feedback? Anyone from Kerala?
Ayush
Hi Ayush,
I happened to ask a few auto drivers in Hyderabad and also in my home district. Most of them prefer Bajaj as after sales service is better. Their negative view on atul is also because of limited after sales service.
Regards
Hi Rajeev,
Have you talked to customers about the product?
A friend inquired in his city & there the response wasnât good.
Hi Guys,
While I agree thatâs its important to get the feedback from the end user, we have got to respect the numbers. Abt 19% growth in July, 38% in August n overall 18% growth for the period April to August 2013 is something that has to get precedence. Product improvement is an on going exercise as the Co. gathers scale.
Hi Rajeev,
I agree with what you say. Numbers are good **so Far **& makes sense to buy/ hold as long as they stay good. But, i guess, major part of growth is due to expansion in newer markets.
Once that stops, only good product will take Atul forward. So, we must not ignore the product.
Why promoters has pledged their holdings. Usually it is not good sign for any stocks.
Where do you see pledging?
It is not necessary in india that every pledged share information we can find from BSE site. I have bought a copy of Dalal Street Magazine Sept 8 edition and according to that Atul auto promotors holding is about 56 % out of which 45 % is pledged. May be they will inform to BSE/NSE etc after next quater result about the same. If true promoters dont believe any upsides in near term.
Disclosure of pledging is compulsory until n unless one is hiding it intentionally. In that case I doubt if even dalal street magazine will know the details.
Request you to share a snapshot or something.
Regards,
Ayush
i made the personal talk with the vice president (finance) and he said that no shares are under pledge
they will communicate with the said magazine
if need be, they will also communicate to the stock exchange
Ayush, This is the link of the magazie:http://www.dsij.in/(dalal street investment journal). I am not a paid member of this site so have no access to the 8 sept issue (aug 26 to sept 8, 2013) from website. Vol XXVIII No 19. The said detail is provided in page number 35. it is clearly printed promoter stake (56.61%) and pledged (45%) against company atul auto. This is only source of my information.
Actually this is exact link of magazine said versionhttp://www.dsij.in/issue-page.aspx?issueid=136. These guy has databank of 3000 companies which is available to subscriber only and in paper based form they provided list of many companies with details and inside that details only said information is there in page number 35.