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Karachi, April 11, 2013 (PPI-OT): According to latest data released by PAMA, total industry sales (cars + LCVS) for Mar’13 have increased by 5.6%MoM (3.9% ex-Fortuner) to 13,344 units.
According to AKD Securities similarly, car sales clocked in at 11,581 units in Mar’13, up 2.1%MoM even as the 9MFY13 car sales figure of 85,083 was down by 25%YoY. In AKD Securities views, this sequential increase may be attributed to the ban on import of 3yrs+ used cars and also from the launch of Toyota Fortuner (228 units).
Other than the Fortuner, drivers of growth included Hilux (+86%M0M) and Civic (+31%M0M). Going forward, AKD Securities expects recent weakness in the Japanese Yen (13%CYTD depreciation vs. the US$) and improved sequential sales to start manifesting in company bottom lines and drive stock price performance. In this regard, AKD Securities expect s PSMC to post NPAT of PkRl8lmn (EPS: PkR2.19) in 1QCY13, laying the foundation for what should be a strong year.
| Mar’13 Auto Numbers | |||||||
| (Units) | Mar-13 | Feb-13 | MoM | YoY | 9MFY13 | 9MFY12 | YoYS |
| Industry Performance | |||||||
| Industry Sales | 13,344 | 12,631 | 56% | -232% | 96,324 | 128,567 | -25% |
| Cars | 11,581 | 11,344 | 2.1% | -20.0% | 85,083 | 112,721 | -25% |
| LCVs and Pickups | 1,763 | 1,287 | 37.0% | -20.2% | 11,241 | 15,846 | -29% |
| Tractors | 3,881 | 2,364 | 64.2% | -37.7% | 35,279 | 28,169 | 25% |
| Company Wise | |||||||
| PSMC | 7,100 | 7,000 | 1.4% | -28.8% | 55,428 | 81,360 | -32% |
| INDU | 3,979 | 3,591 | 10.8% | ~11.4% | 25,825 | 38,858 | -34% |
| HCAR | 2,228 | 2,015 | 10.6% | 228.8% | 14,758 | 7,999 | 84% |
PSMC: Mar’13 sales at 7,100 units are up 1.4%MoM. As a result, PSMC has sold 21,104 units in 1QCY13, up a strong 27%QoQ partly due to seasonal factors (new year registrations) but also post ban on import of 3yrs+ used cars. For 1 OCY1 3, AKD Securities expects PSMC to post NPAT of PkR1 81 mn (EPS: PkR2.19). While profits are projected to be lower by 69%YoY, 1QCY13 results should represent an important inflection point after two consecutive quarterly losses.
INDU: With 228 units of the new Fortuner sold in Mar’13, INDU’s sales increased by 1O.8%MoM (4.4%M0M ex-Fortuner). In this regard, other than Fortuner, the Hilux variant depicted strong 86%MOM growth although Corolla sales disappointingly came off by 1.6%MoM to 3,284 units.
HCAR: Honda’s new model of Civic is gaining appreciation from consumers as the 1,206 units sold in Mar’13 were up a strong 31%MoM. However, City sales came off by 6.8%MoM. This led to an overall growth of 1 O.6%MoM for HCAR.
Tractors: Overall tractor sales came in at 3331 units in Mar’13, up by a robust 64%MoM. Sales recorded by MTL were 2,577 units, up 29%MoM while AGTL sales were 1,304 units, up exceptional 2.6x MoM. In 9MFY1 3, total tractor sales came in at 35,279 units, up 25%YoY.
Outlook: The sequential increase in auto sales in 1QCY13 sets the base for what should be a strong year. In this regard, positive include margin uptick on the back of a weaker JPY, ban on import of 3yrs+ used vehicles and lower interest rates leading to a revival in auto financing. While the auto sector has outperformed the KSE-100 Index by 11.5%CYTD, AKD Securities believes potential for further outperformance remains.