PAK SUZUKI MOTOR COMPANY LTD.
S.KAMAL HAYDER KAZMI,
Research Analyst, PAGE
Feb 7 - 13, 2011
Pak Suzuki Motor Company Ltd. (PSMCL) is a Pakistan based automobile manufacturing company. The company's products include Mehran, Alto, Cultus, Liana, Bolan Van, Ravi Pickup, Jimny MT, APV, and Potohar.
The company has also launched its new product by the name of Suzuki Swift. There are about 154 active vendors of Pak Suzuki, which spread from Karachi to Lahore and Rawalpindi.
HALF-YEAR FINANCIAL PERFORMANCE (RS. '000)
INDICATORS ENDED JUNE 30, 2010 ENDED JUNE 30, 2009 Turnover 21,930,001 9,747,726 Cost of sales 21,226,005 9,409,381 Gross profit 703,996 338,345 Distribution costs 125,444 84,695 Administration expenses 316,032 226,06 Profit before tax 514,290 278,243 Net profit 279,359 161,298 EPS (Rs) 3.39 1.96
INDICATORS JUNE 30, 2010
DEC 31, 2010
Non Current Liabilities 5000 5000 Current Liabilities 4,039,397 3,325,134 Current Assets 13,470,385 12,427,633 Non Current Assets 5,137,821 5,228,101
The dealers of Pak Suzuki encompass all the areas of automobile marketing, which include sales, service, and Suzuki spare parts. The manufacturing plant located in Bin Qasim has a production capacity of 150,000 vehicles per year. The company also provides other facilities like press shop, welding shop, paint shop, engine and transmission assembly shop, final assembly, and hi-tech inspection shop. Pak Suzuki produces a wide range of vehicles that serve the widest spectrum of customer needs in the country.
Each of the Pak Suzuki products enjoys a unique position of its own and the exceptional success of these vehicles underscores their progressive performance abilities. The difference between Pak Suzuki motor company from other automobile assemblers is its Press Shop; PSMC is the only automobile manufacturer, which owns this facility.
Before quality product rolls out from the Pak Suzuki plant, it goes through state of the art manufacturing processes under strict quality control measures. The press shop consists of the most modern stamping facilities equipped with a Tandem Press Line with more than 1,000 stamping dies. The facility of Tandem Press Line available in the company renders it the status of the only car manufacturing company in Pakistan.
During June 2010, Pak Suzuki sold 40,560 units of cars and light commercial vehicles against 18,175 units in the same period last year. This represented an improvement in sales volume by 123 per cent. The company increased its production to 38,386 units in June 2010 against 17,420 units produced in the same period last year. The level of production represented 51 per cent capacity utilization. The company earned after tax profit of Rs279,359 million compared to Rs161,298 million in the previous period. The improvement arose from increase in sales volume and curtailment of commission to dealers.
Sales revenues increased by 123 per cent from Rs10.096 billion in June 2009 to Rs22.506 billion in June 2010 due to higher volume. Distribution expenses increased from Rs84.695 million to Rs125.44 million but a percentage of sales decreased from 0.8 per cent to 0.6 per cent.
The increase in expense was mainly because of launching of new model swift. Administration expenses increased from Rs226.069 million to Rs316.032 million but a percentage of sales decreased from 2.2 per cent to 1.4 per cent. The factors, which contributed to this increase, included increase in prices of petrol, computer software, doubtful advances and depreciation.
Other operating income increased from Rs280.602 million to Rs311.983 million. The increase was because of income on bank deposits. Financial charges increased from Rs4.769 million to Rs19.900 million.
Recently, the price of Suzuki Mehran has increased by Rs11,000; Alto Rs15,000; Cultus Rs15,000; Swift Rs20,000; Ravi Rs15,000, Bolan Rs12,000 and Liana by Rs25,000.
The new prices of Suzuki vehicles are Swift 1.3 DLX: Rs1,058,000; Swift 1.3 DX: Rs989,000; Liana 1.3L RXI MT: Rs1,149,000; Liana 1.3L RXI MT CNG: Rs1,219,000; Cultus VXRI: Rs850,000; Cultus VXRI CNG: Rs891,000; Alto VXR: Rs656,000; Alto VXR CNG: Rs705,000; Mehran VX: Rs453,000; Mehran VX CNG: Rs499,000; Mehran VXR: Rs505,000; Mehran VXR CNG: Rs549,000; AVP 1.5L Rs1,824,000; APV 1.5L CNG: Rs1,899,000; Jimmy JLSX M/T: Rs1,789,000; Jimmy JLDX M/T: Rs1,939,000; Bolan VX: Rs532,000; Bolan VXR: Rs592,000; Bolan VX CNG: Rs584,000; Bolan VXR CNG: Rs645,000; Cargo van: Rs507,000; Ravi VX: Rs473,000; and Ravi VX CNG: Rs524,000.
The waive of new raise in prices has shocked the people who were expecting a decrease in the prices of vehicles. Future Outlook
Pak Suzuki is pioneer in manufacturing automobile and has modern vehicle manufacturing facilities. Suzuki is a renowned name amongst the people of Pakistan as Suzuki products serve majority of Pakistani customers and have become a household name. Pak Suzuki is striving to maintain its leadership in Pakistani market. Pak Suzuki is also exporting Suzuki Ravi pickups and Liana cars and components to Bangladesh and Europe thus earning precious and much needed foreign exchange for the country.