May 3, 2010

Key Data
INR
INR
Amtek Auto Ltd
CMP 186
Target Price 201
3Q FY10 Results
Bloomberg Code AMTK IN AAL’s revenue grew by 30.9% on YoY basis to INR 9,699.3 million . EBIDTA
Reuters Code AMTK.BO margins rose 580 bps on YoY basis to 25.6% on better capacity utilization and
BSE Code 520077 better performance of subsidiaries .Net profits quadrapuled on YoY basis to INR767
NSE Code AMTEKAUTO million.
Face Value (INR) 2
Key Highlights
Market Cap (INR Bn) 35.87
52 Week High (INR) 239.3
• For Q3 FY10, AAL’s revenue increased to 9,699.3 million from INR 9,034.7
52 Week Low (INR) 91.7
million in Q2 FY10 - an increase of 7.4% q-o-q.
Avg. Daily Volume (6m) 1340472 • The Ebidta margins in Q3 FY10 stood at 25.6%. The operating margins
increased 190 basis points on q-o-q basis. AAL reported operating profit of INR
Shareholding % 2,481.1 million as compared to 2,145 million in Q2 FY10. Increase in margins
Promoters Group 29.0 was due to better performance of its overseas subsidiaries (Amtek Investments
Banks / Mutual Fund / FI 12.4 U.K. and Smith Jones Inc), post restructuring measures carried out by the
FII 36.6 company.
Bodies Corporate 6.5
• Net Profit recorded was INR 767 million as against INR 188.6 million in the
Individuals 2.9
same quarter, last year.
Others 12.6
Total 100
• Domestic auto volumes continue to remain robust on back of good underlying
demand. Sales in the passenger car segment increased 26.8% yoy in April
2009-March 2010 period. Similarly, commercial vehicle sales also grew by 35%
yoy in April 2009-March 2010 period.
• However, car sales in Europe are expected to remain sluggish, particularly after
the withdrawal of “Scrappage incentive” that was offered by various nations to
bolster new vehicle sales.

Quarterly Financials
Y-o-Y Q-o-Q
Particulars Q3 FY10 Q3 FY09 Q2 FY10
Change Change
Total Income 9,699.3 7,409.0 30.9 9,034.7 7.4
Total Expenditure 7,218.2 5,945.7 21.4 6,889.7 4.8
EBDITA 2,481.1 1,463.3 69.6 2,145.0 15.7
EBDITA Margin 25.6 19.8 23.7
Net Profit 852.3 244.3 248.9 652.1 30.7
Minority Interest 85.3 55.7 53.1 69.1 23.4
Net Profit after Minority
767.0 188.6 306.7 583.0 31.6
Interest
PAT% 7.9 2.5 6.5
Source: Company, ACMIIL Research

Analyst
Bharat Gianani
research@acm.co.in
Tel: +91-22 2858 3404

Exide Industries Ltd – Result Update ACMIIL 1

 Business Outlook
Automotive sales in domestic market are expected to remain robust on back of
strong underlying demand due to factors like rising disposable incomes, low
penetration levels etc. Sales in all segments (Cars, Two wheelers, Commercial
vehicles) are expected to exhibit strong performance. European car sales, however,
are expected to be sluggish given the withdrawal of “Scrappage incentive” by most
countries. Strong domestic market sales coupled with restructuring measures
carried on by the company are expected to increase margins going forward. We
have factored Operating margin of 23.6% in FY11 and 23.8% in FY12.
Domestic Player car sales
(no of units)

250000

200000

150000

100000

50000

0
Jun- Jul- Aug- Sep- Oct- Nov- Dec- Jan- Feb- Mar-
09 09 09 09 09 09 09 10 10 10

Source: SIAM, ACMIIL Research

Valuation
The scenario in the domestic market is encouraging. However, sluggishness is
expected in the European market. We have estimated EPS of 20.1 in FY12. We
assign multiple of 10X to arrive at value of INR 201 per share. We thus maintain
“Hold” recommendation on the stock. At CMP of 186, the stock trades at a PE of
11.6X its FY11 EPS and 9.3X its EPS of FY12.

Exide Industries Ltd – Result Update ACMIIL 2

 Financials
Profit & Loss A/c INR Mn
Particulars FY08 FY09 FY10E FY11E FY12E
Net Revenue 46,567.9 34,386.2 37,554.9 41,517.4 46,641.2
less: Expenditure 36,968.5 27,381.7 28,504.2 31,735.9 35,550.0
PBDIT 9,599.4 7,004.6 9,050.7 9,781.5 11,091.3
less: Depreciation 2,104.6 2,728.5 2,950.2 2,976.1 3,021.1
PBIT 7,494.9 4,276.1 6,100.5 6,805.4 8,070.2
less:Interest 1,156.6 1,523.0 1,700.0 1,740.0 1,770.0
PBT 6,338.2 2,753.0 4,400.5 5,065.4 6,300.2
less:Tax 1,690.7 849.5 1,210.1 1,418.3 1,764.1
Profit before minority interest 4,647.6 1,903.6 3,190.4 3,647.1 4,536.1
less: Minority Interest 373.4 176.0 237.5 273.2 314.1
Net Profit 4,274.2 1,727.6 2,952.8 3,373.9 4,222.0

Sales Growth (%) 25.2 -26.2 9.2 10.6 12.3

PBDIT Growth (%) 19.1 -27.0 29.2 8.1 13.4
Net Profit After Minority Interest Growth (%) 4.6 -59.6 70.9 14.3 25.1
PBDIT Margin (%) 20.6 20.4 24.1 23.6 23.8
NP Margin (%) 9.2 5.0 7.9 8.1 9.1
Source: Company, ACMIIL Research

Balance Sheet INR Mn

Particulars FY08 FY09 FY10E FY11E FY12E
Share Capital 282.0 282.0 420.2 420.2 420.2
Reserves & Surplus 29,240.7 31,705.7 44,316.7 51,146.1 55,260.3
Total Shareholders Fund 29,522.7 31,987.7 44,736.9 51,566.3 55,680.5
Secured Loans 6,443.1 14,137.8 9,538.5 9,776.8 9,613.7
Unsecured Loans 22,548.7 24,843.2 18,462.9 8,417.9 7,363.6
Total Loans 28,991.8 38,981.0 28,001.5 18,194.7 16,977.3
Minority Interest 2,194.6 2,225.6 2,463.2 2,736.3 3,050.5
Total Sources of Fund 61,399.1 73,693.1 75,201.6 72,497.4 75,708.4
Application of Fund
Goodwill 1,446.2 3,944.2 3,193.1 2,279.7 1,113.7
Gross Block 51,027.7 62,335.3 64,135.3 66,135.3 67,135.3
less:Depreciation 10,676.7 13,255.2 16,205.4 19,181.5 22,202.6
Net Block 40,351.0 49,080.1 47,929.8 46,953.8 44,932.7
Investments 615.2 490.6 490.6 490.6 490.6
Total Current Assets 30,289.5 30,929.0 34,424.1 34,151.7 42,015.9
Total Current Liabilities 11,217.7 10,643.0 10,728.1 11,267.7 12,725.4
Net Current Assets 19,071.8 20,286.0 23,696.0 22,884.0 29,290.5
Total Application Of Fund 61,399.1 73,693.1 75,201.6 72,497.4 75,708.4
Source: Company, ACMIIL Research

Exide Industries Ltd – Result Update ACMIIL 3

Cash Flow Statment INR Mn
Particulars FY08 FY09 FY10E FY11E FY12E
Profit Before Tax 6,338.2 2,753.1 4,400.5 5,065.4 6,300.2
Depreciation 2,104.6 2,728.5 2,950.2 2,976.1 3,021.1
Interest & Dividend earned -436.2 -1,723.7 -1,008.5 -502.2 -589.7
Interest Paid 1,156.6 1,523.0 1,700.0 1,740.0 1,770.0
Net Operating Profit Before working capital change 8,206.1 5,481.6 8,108.8 9,279.3 10,501.6
Net Cash Flow from Operating activities 5,463.0 2,718.5 9,345.2 9,149.5 11,623.4
Net Cash used in Investment Activities -13,613.7 -14,008.9 -1,800.0 -2,000.0 -1,000.0
Net Cash from Financing activities 13,952.1 8,899.3 -2,881.9 -8,091.3 -3,095.1
Net Increase/decrease in cash & cash equivalent 5,801.4 -2,391.2 4,663.3 -941.8 7,528.3
Cash at Beginning 4,571.3 10,372.7 7,981.5 12,644.8 11,703.0
Cash at End of Period 10,372.7 7,981.5 12,644.8 11,703.0 19,231.3
Source: Company, ACMIIL Research

Valuation Ratios FY08 FY09 FY10E FY11E FY12E

Profitability Ratios
Operating Margins (%) 20.6 20.4 24.1 23.6 23.8
PAT After Minority Interest (%) 9.2 5.0 7.9 8.1 9.1
ROCE (%) 12.2 5.8 8.1 9.4 10.7
RONW (%) 14.1 5.3 6.6 6.5 7.6

Capital Structure Ratios

Debt-Equity 1.0 1.2 0.6 0.4 0.3
Turnover Ratios
Avg Fixed Assets 0.9 0.6 0.6 0.6 0.7
Inventory 6.5 4.6 5.2 5.8 6.5
Debtors 5.7 6.6 6.2 6.6 6.8
Creditors 6.6 5.6 5.3 5.7 5.9
Solvency Ratios
Current Ratio 2.7 2.9 3.2 3.0 3.3
Interest Coverage Ratio 6.5 2.8 3.6 3.9 4.6
Valuation Ratios
EPS 30.3 12.3 14.1 16.1 20.1
BV/Share 209.4 226.9 212.9 245.4 265.0
Source: Company, ACMIIL Research

Exide Industries Ltd – Result Update ACMIIL 4

 Notes

Institutional Sales:

Ravindra Nath, Tel: +91 22 2858 3400

Kirti Bagri, Tel: +91 22 2858 3731

Himanshu Varia, Tel: +91 22 2858 3732

Email: instsales@acm.co.in

Institutional Dealing:

Email: instdealing@acm.co.in

Disclaimer:
This document has been prepared by the Research Desk of Asit C Mehta Investment Interrmediates Ltd. and is meant for use of the recipient only and is not for
circulation. This document is not to be reported or copied or made available to others. It should not be considered as an offer to sell or a solicitation to buy any
security. The information contained herein is from sources believed reliable. We do not represent that it is accurate or complete and it should not be relied upon as
such. We may from time to time have positions in and buy and sell securities referred to herein.
SEBI Regn No: BSE INB 010607233 (Cash); INF 010607233 (F&O), NSE INB 230607239 (Cash); INF 230607239 (F&O)

Exide Industries Ltd – Result Update ACMIIL 5