AUTOMOTIVE AXLES LTD - Quantamental Equity Research Report

Quantamental Equity Research on AUTOMOTIVE AXLES LTD | Release: 13 Feb 2019 11:32:29 UTC+05:30 | Reporting Currency: INR | Trading Currency: INR | Exchange:NSE/BSE NSE CODE:AUTOAXLES and BSE CODE:505010
Last Close:  INR 1115.35
Fair Value:  INR 847.6
Est. Price by Mar 19:  INR 1525.45
Market Capitalization (INR Crs):  1685.29
Industry:  Auto Parts & Equipment
Rating:  STRONG BUY
Upside:  37%
Company Profile
Automotive Axles Limited is engaged in the manufacturing of automotive axles. The Company operates through the segment of manufacturing and sale of automotive components. It manufactures rear drive axle assemblies in India.
Growth Per Share
Particulars 1-Year 3-Year 5-Year  
Revenue % 30% 42% 74%  
EBIT % 68% 523% 374%  
Earnings % 70% 696% 561%  
Book Value %  18% 47% 58%  
Stock Total Return %  119% 104% 600%  
Share holding pattern
Particulars %age   
(A) Promoter & Promoter Group 71.04  
(B) FII/FPI 1.39  
(C) DII/Insurance Companies 8.90  
(D) Public holding < 2 lakhs of cap. 11.89  
(E) Others 6.78  
Grand Total 100.00  
Fundamentals (Historical and Estimated)
Particulars Sep-10 Sep-11 Sep-12 Sep-13 Sep-14 Mar-15 Mar-16 Mar-17 Mar-18  Mar-19 E   Mar-20 E   Mar-21 E   Mar-22 E   Mar-23 E   
Price 514 392 390 224 660 771 598 718 1571 1525 1902 2119 2363 2563  
Return on Equity 22% 24% 17% 5% 6% 3% 11% 13% 19% 22% 22% 21% 20% 19%  
Price to Earning  17.6 10.3 13.1 26.7 54.9 110.6 26.0 21.9 28.3 20.0 20.0 20.0 20.0 20.0  
EVTI 1.3 0.6 0.7 0.6 1.6 2.7 0.9 0.9 1.6 1.2 1.3 1.3 1.3 1.3  
EVTIFM 17.6 10.3 13.1 26.7 54.9 110.6 26.0 21.9 28.3 20.0 20.0 20.0 20.0 20.0  
Price to Book Value 3.8 2.4 2.2 1.2 3.4 3.9 2.8 2.9 5.3 4.3 4.5 4.2 4.0 3.7  
Debt to Equity  0.3 0.3 0.2 0.2 0.3 0.2 0.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0  
Dividend Yield 2% 3% 3% 1% 0% 0% 1% 1% 1% 1% 1% 1% 1% 1%  
Cash Flow to Firm 2% 10% 9% 8% -1% 4% 8% 6% 3% 5% 6% 8% 8% 7%  
Detailed Estimates
Title Mar-18 Mar-19 E Mar-20 E Mar-21 E Mar-22 E Mar-23 E  
Sales       1,519.36       1,909.39       2,202.20       2,312.31       2,427.92       2,549.32  
EBITDA          171.58          228.91          264.01          277.21          291.08          305.63  
EBIT          128.37          174.61          217.72          242.54          270.42          293.32  
PBT          127.82          174.61          217.72          242.54          270.42          293.32  
NPAT            83.93          115.24          143.70          160.08          178.48          193.60  
Price to Earning             28.28            20.00            20.00            20.00            20.00            20.00  
Price to Book Value              5.34              4.34              4.49              4.20              3.98              3.71  
Debt to Equity                  -                   -                   -                   -                   -                   -    
Return on Equity              0.19              0.22              0.22              0.21              0.20              0.19  
Enterprise Value to Total Income (EVTI)              1.56              1.19              1.25              1.28              1.31              1.32  
Enterprise Value to Total Income to Firm Margin(EVTIFM)            29.75            20.88            20.36            19.56            18.94            18.38  
Price or Est. Share Prices       1,570.58       1,525.45       1,902.15       2,118.95       2,362.55       2,562.70  
DISCOUNTED CASH FLOW
Title Mar-19 E Mar-20 E Mar-21 E Mar-22 E Mar-23 E  
PBT          174.61          217.72          242.54          270.42          293.32  
Interest                 -                   -                   -                   -                   -    
Depreciation            54.30            46.29            34.68            20.66            12.31  
Cash Flow Before Tax          228.91          264.01          277.21          291.08          305.63  
Tax Rate            33.99            33.99            33.99            33.99            33.99  
Cash Flow After Tax          151.10          174.28          182.99          192.14          201.75  
Terminal Cash Flow                                                                                    -         1,580.34  
Total Cash Flow          151.10          174.28          182.99          192.14       1,782.08  
Present Value of Cash Flow       1,280.68  
Debt                 -    
Value of Equity       1,280.68  
Fair Value Per Share          847.60  
Equity            1,685
Debt                   0
Beta Take from Reuters 1.34
Risk Free Rate Prevailing Yield in India 7%
Market Risk Premium Assuming 8.82% premium for Equity Investments 7%
Interest Paid                   1
Tax Benefit                   0
Interest Net of Tax                   0
Debt                   0
Cost of Debt 0%
Cost of Equity 17%
Debt Weight 0%
Equity Weight 100%
WACC 17%
Cash Flow of Mar-23 E          201.75
Growth 5.8%
Present Value of Terminal Cashflow       1,580.34
Peer Comparision
# Name CMP Rs. Mar Cap Rs.Cr.  B.V. Rs. Annualized ROE % ROCE % Latest EVTI Latest EVTIFM CMP / BV P/E Debt / Eq Div Yld % Growth Rate R % SGR % Ann Total Income Unpledged Prom Hold % PQEIOI QoQ Sales % Qtr Sales Var % QoQ Profits % Qtr Profit Var % Graham's Number Rs.
   1  Motherson Sumi           128.75          40,658            33.70            19.30            19.86              0.72            32.96              3.82            23.34              1.05              1.16            13.57            10.58          66,254            59.48               136              9.06            14.49              4.85          -30.91            61.94
   2  Bosch      18,592.20          56,745       3,424.93            21.16            22.73              3.71            42.38              5.43            34.90                 -                0.54            16.45            34.69          13,362            70.49               202            -0.34            13.84            -2.55            18.86       6,287.47
   3  Exide Inds.           209.05          17,769            68.05            14.10            20.08              1.57            26.36              3.07            23.84                 -                1.15              9.80            15.90          10,019            45.99               121            -8.22              9.59          -42.24              0.50          121.74
   4  Endurance Tech.        1,283.10          18,048          170.07            21.85            23.06              2.54            40.70              7.54            37.90              0.37              0.31            18.70            20.38            7,206            82.50               167            -6.39            17.84          -22.88            16.51          354.76
   5  Amara Raja Batt.           740.25          12,644          183.09            22.37            24.92              1.84            26.07              4.04            26.68              0.02              0.56            19.01            17.96            6,829            52.06               107            -3.33              9.09              8.87            -2.65          338.11
   6  Automotive Axles        1,115.35            1,685          317.14            36.90            31.21              0.82            13.08              3.52            15.10                 -                1.21            27.93            26.58            1,997            71.04                 54              5.19            42.54            10.52            56.72          726.07

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