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    Auto Industry Analysis: By-Arabinda Kar PGDM Ii Year

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    Shalini Thomas
    The automobile industry in India is the tenth largest in the world, producing approximately 2 million vehicles annually. It can be divided into passenger vehicles, commercial vehicles, three-wheelers, and two-wheelers. Between 2002-2003 and 2007-2008, production of passenger vehicles grew by 143% while commercial vehicles grew by 167%. Two-wheeler production increased by 58% in this period. Bajaj Auto Limited is the second largest two-wheeler manufacturer in India, with over 20% market share. For the fiscal year 2009, Bajaj Auto's revenues are estimated to grow 0.4% to INR 94,485 million, but net profit is expected to decline 13.4% to INR 6,527

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    Auto Industry Analysis: By-Arabinda Kar PGDM Ii Year

    Uploaded by

    Shalini Thomas
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    The automobile industry in India is the tenth largest in the world, producing approximately 2 million vehicles annually. It can be divided into passenger vehicles, commercial vehicles, three-wheelers, and two-wheelers. Between 2002-2003 and 2007-2008, production of passenger vehicles grew by 143% while commercial vehicles grew by 167%. Two-wheeler production increased by 58% in this period. Bajaj Auto Limited is the second largest two-wheeler manufacturer in India, with over 20% market share. For the fiscal year 2009, Bajaj Auto's revenues are estimated to grow 0.4% to INR 94,485 million, but net profit is expected to decline 13.4% to INR 6,527

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    The automobile industry in India is the tenth largest in the world, producing approximately 2 million vehicles annually. It can be divided into passenger vehicles, commercial vehicles, three-wheelers, and two-wheelers. Between 2002-2003 and 2007-2008, production of passenger vehicles grew by 143% while commercial vehicles grew by 167%. Two-wheeler production increased by 58% in this period. Bajaj Auto Limited is the second largest two-wheeler manufacturer in India, with over 20% market share. For the fiscal year 2009, Bajaj Auto's revenues are estimated to grow 0.4% to INR 94,485 million, but net profit is expected to decline 13.4% to INR 6,527

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    16 views15 pages

    Auto Industry Analysis: By-Arabinda Kar PGDM Ii Year

    Uploaded by

    Shalini Thomas
    The automobile industry in India is the tenth largest in the world, producing approximately 2 million vehicles annually. It can be divided into passenger vehicles, commercial vehicles, three-wheelers, and two-wheelers. Between 2002-2003 and 2007-2008, production of passenger vehicles grew by 143% while commercial vehicles grew by 167%. Two-wheeler production increased by 58% in this period. Bajaj Auto Limited is the second largest two-wheeler manufacturer in India, with over 20% market share. For the fiscal year 2009, Bajaj Auto's revenues are estimated to grow 0.4% to INR 94,485 million, but net profit is expected to decline 13.4% to INR 6,527

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    Download as ppt, pdf, or txt
    of 15

    Auto industry analysis

    By- Arabinda Kar


    PGDM II Year

    Automobile industry
    Tenth largest in the world with an annual production of
    approximately 2 million units

    AUTOMOBILE

    2 WHEELER

    3 WHEELER

    PASSENGER
    VEHICLE

    COMMERCIAL
    VEHICLE

    Trends in Automobile sector

    Continue.
    Automobile Production Trends

    Category

    2002-03

    2003-04

    (Number
    of
    Vehicles)

    2004-05

    2005-06

    2006-07

    2007-08

    Passenger
    Vehicles

    723,330

    989,560

    1,209,876

    1,309,300

    1,545,223

    1,762,131

    Commerci
    al Vehicles

    203,697

    275,040

    353,703

    391,083

    519,982

    545,176

    Three
    Wheelers

    276,719

    356,223

    374,445

    434,423

    556,126

    500,592

    Two
    Wheelers

    5,076,221

    5,622,741

    6,529,829

    7,608,697

    8,466,666

    8,026,049

    Grand
    Total

    6,279,967

    7,243,564

    8,467,853

    9,743,503 11,087,997 10,833,948

    Automobile Domestic Sales Trends


    (Number
    of Vehicles)

    Category

    2002-03

    2003-04

    2004-05

    2005-06

    2006-07

    2007-08

    Passenger
    Vehicles

    707,198

    902,096

    1,061,572

    1,143,076

    1,379,979

    1,547,985

    Commercia
    190,682
    l Vehicles

    260,114

    318,430

    351,041

    467,765

    486,817

    Three
    Wheelers

    231,529

    284,078

    307,862

    359,920

    403,910

    364,703

    Two
    Wheelers

    4,812,126

    5,364,249

    6,209,765

    7,052,391

    7,872,334

    7,248,589

    Grand
    Total

    5,941,535

    6,810,537

    7,897,629

    8,906,428

    10,123,988

    9,648,094

    Automobile Exports Trends


    (Number of
    Vehicles)
    Category

    2002-03

    2003-04

    2004-05

    2005-06

    2006-07

    2007-08

    Passenger
    Vehicles

    72,005

    129,291

    166,402

    175,572

    198,452

    218,418

    Commercia
    l Vehicles

    12,255

    17,432

    29,940

    40,600

    49,537

    58,999

    Three
    Wheelers

    43,366

    68,144

    66,795

    76,881

    143,896

    141,235

    Two
    Wheelers

    179,682

    265,052

    366,407

    513,169

    619,644

    819,847

    Grand Total

    307,308

    479,919

    629,544

    806,222

    1,011,529

    1,238,499

    Analysis of current scenario


    High interest rates, high domestic oil prices and
    inadequate vehicle financing have continued to affect
    the overall automobiles sector

    The current slowdown in economic growth and


    automobiles industry has further deteriorated due to the
    global financial market crisis which has created
    volatility in stock markets and exchange rates and
    aggravated lack of liquidity

    Continued....
    Automobile companies are reducing
    production by shutting plants for a few
    days to avoid inventory build-up and in
    anticipation of seeing further downside

    Four wheeler industry performance

    Volumes plummeted 23.6% to 100k in Nov08, led by a 21.2%


    decline in volumes of A2 segment (55% of domestic market) to 61k
    units

    The overall industry de-grew by 8.1% to135k units in Nov08.

    Two wheeler Industry performance


    volumes declined by 14.7% to 567k units as compared
    to 665k units in Nov07

    The Key player.

    Bajaj Auto Limited

    BAL Auto is the second largest two-wheeler


    manufacturer in India with a market share of
    more than 20%

    Financials
    Year to March

    FY08

    FY09E

    Revenues (INR mn)

    90,455

    94485

    Rev. growth (%)

    -0.4

    EBITDA (INR mn)

    12,929

    11,383

    Net profit (INR mn)

    7,558

    6,527

    shares outstanding (mn)

    144.7

    144.7

    EPS (INR)

    52.2

    45.2

    EPS growth (%)

    -13.4

    P/E (x)

    5.3

    6.1

    EV/EBITDA (x)

    3.1

    3.1

    ROACE (%)

    42.6

    35.5

    ROAE (%)

    54.6

    43.6

    Growth metrics (%)

    FY09E

    Revenues

    -0.4

    EBITDA

    11.45

    PBT

    -8.3

    Net profit

    -1.7

    EPS

    -13.1

    Thank You !

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