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Automotive Axles
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Promoted as a joint venture by the Kalyani Group and Rockwell International Corporation, US, (35.52% stake) in 1981, Automotive Axles Limited (AAL) manufactures all types of complete axles and axle assemblies including components and corresponding brake sets. It manufactures automotive gears and air- and hydraulic-activated brake assemblies.
The Company is the largest independent manufacturer of Rear Drive Axle Assemblies in the country. The Company is a joint venture company incorporated in 1981, between Bharat Forge Limited, Pune, India and Meritor Heavy Vehicle Systems LLC, USA. The Company is primarily engaged in manufacturing of Axles and Brakes at Mysore, Rudrapur and Jamshedpur.
The Company's Rs 30.3-cr project at Hootagali near Mysore, commenced commercial production in Jul.'84. The company entered the capital market with a public issue.
The Company came out of the purview of the Sick Industrial Companies Act, 1985. But, the very next year, its Networth started to erode. So, in 1994-95, it embarked on a restructuring of the capital in consultation with financial institutions. The company came out with a rights issue in Feb.'95 to part-finance an expansion project to increase the manufacturing capacity of axles and brakes.
During 1996-97, the expansion of Axles capacity has been completed and of brakes was put on hold in view of down turn in the market.
The company managed to achieve an impressive 20% growth in sales during the year 1999-2000. As the company is continuing to pursue its efforts on increasing penetration into other domestic and export market opportunities, Meritor HVS (India) Ltd has tied-up technical licensing arrangement for new products for Ashok Leyland and Volvo India Ltd., and already export business worth US $ 4 Million has been achieved.
During 2010-2011, Company had established brake manufacturing facility at Mysore & Rudrapur with Building, Plant and Machinery purchased from Kalyani Global Engineering Pvt Ltd. Thereafter, it established Contract Manufacturing Facility for manufacturing Trailer Axles in Greater Noida, Uttar Pradesh with the plant and inventories purchased from ANG Industries Limited.
During the year 2011-12, the Company took up the initiative, along with other group companies, to generate power from Green Energy sources and installed one Wind Turbine Generator with 2.00 MW generation capacity at Tithwa, Gujarat. Total Generation of power from the wind mill during the year was 17.42 Lacs KwH (April to September, 2012) which was in turn sold to Gujarat Urja Vikas Nigam Limited. Company launched two new products in 2012-13 - one in the lower variant of 5T axle and the higher variant of 18T reduction axle.
The Company expanded its manufacturing foot print with a new state-of-the-art plant at Jamshedpur for manufacturing Brakes and Trailer axles. The plant had 50,000 Sq.Ft built-up area and had a capacity to make 30,000 brakes and 2,500 Tag & Trailer per month in FY 2013-14. The Company installed a facility to manufacture Hub Reduction Axles at its Mysuru plant during FY 2014-15.
During the year 2021-22, Company introduced the largest axle in India for 55 tonnes vehicles.
Automotive Axles share price reflects investor sentiment toward the company and is impacted by various factors such as financial performance, market trends, and economic conditions. Share price is an indicator which shows the current value of the company's shares at which buyers or sellers can transact.
Market capitalization of Automotive Axles indicates the total value of its outstanding shares. Marketcap is calculated by multiplying share price and outstanding shares of the company. It is a helpful metric for assessing the company's size and market Valuation. It also helps investors understand how Automotive Axles is valued compared to its competitors.
Automotive Axles PE ratio helps investors understand what is the market value of each stock compared to Automotive Axles 's earnings. A PE ratio higher than the average industry PE could indicate an overvaluation of the stock, whereas a lower PE compared to the average industry PE could indicate an undervaluation.
The PEG ratio of Automotive Axles evaluates its PE ratio in relation to its growth rate. A PEG ratio of 1 indicates a fair value, a PEG ratio of less than 1 indicates undervaluation, and a PEG ratio of more than 1 indicates overvaluation.
Return on Equity (ROE) measures how effectively Automotive Axles generates profit from shareholders' equity. A higher ROE of more than 20% indicates better financial performance in terms of profitability.
Return on Capital Employed (ROCE) evaluates the profitability of Automotive Axles in relation to its capital employed. In simple terms, ROCE provides insight to investors as to how well the company is utilizing the capital deployed. A high ROCE of more than 20% shows that the business is making profitable use of its capital.
Total debt of Automotive Axles shows how much the company owes to either banks or individual creditors. In simple terms, this is the amount the company has to repay. Total debt can be a very useful metric to show the financial health of the company. Total debt more than equity is considered to be a bad sign.
The Debt-to-Equity (DE) ratio of Automotive Axles compares its total debt to shareholders' equity. A higher Debt to Equity ratio could indicate higher financial risk, while a lower ratio suggests that the company is managing its debt efficiently.
CAGR shows the consistent growth rate of Automotive Axles over a specific period, whether it is over a month, a year, or 10 years. It is a key metric to evaluate the company’s long-term growth potential. Main metrics for which CAGR is calculated are net sales, net profit, operating profit, and stock returns.
Technical analysis of Automotive Axles helps investors get an insight into when they can enter or exit the stock. Key components of Automotive Axles Technical Analysis include:
There are usually multiple support levels, but the main support levels for a stock are S1, S2, S3. Support levels indicate price points where stock might get support from buyers, helping the stock stop falling and rise.
There are usually multiple resistance levels, but the main resistance levels for a stock are R1, R2, R3. Resistance levels represent price points where Automotive Axles shares often struggle to rise above due to selling pressure.
Dividends refer to the portion of the company’s profits distributed to its shareholders. Dividends are typically paid out in cash and reflect Automotive Axles ’s financial health and profitability.
Bonus shares are usually given by companies to make the stock more affordable, increase liquidity, boost investor confidence, and more.
Stock split increases the number of its outstanding shares by dividing each existing share into multiple shares. When the company offers a stock split, the face value of the stock reduces in the same proportion as the split ratio.
The financials of Automotive Axles provide a complete view to investors about its net sales, net profit, operating profits, expenses, and overall financial health. Investors can analyze financial data to assess the company’s stability and also understand how the company has been growing financially.
The profit and loss statement of Automotive Axles highlights its net sales, net profit, total expenditure, and operating profits in the current financial year. This Profit and Loss statement is crucial for evaluating the profitability and financial stability of Automotive Axles .
The balance sheet presents a snapshot of Automotive Axles ’s assets, liabilities, and equity of shareholders, providing insights into the financials of the company.
Cashflow statements track the company's cash inflows and outflows over a period. It is an essential tool for understanding how well the company manages its liquidity and finances.
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