Honda: Solid prospects

Atlas Honda Limited (PSX: ATLH) wrapped up its third quarter ending December 2016 with a topline of Rs17 billion; which grew by 22 percent year-on-year owing to improved sales numbers this year around. Honda motorbikes sold during the period Oct-Dec 2016 stood at 248,689 units against 204,045 during this period in 2015, according to data retrieved from PAMA. Meanwhile, the average monthly sales since July 2016 were 17 percent higher, which contributed to the growth in the topline.

During the quarter, ATLH earned an after-tax profit of one billion rupees, growing by 33 percent year-on-year. Cumulatively, in the nine-months, revenues stood at Rs45.9 billion against Rs40.5 billion this period last year, while the bottom line for the nine months ending Dec 2016 was Rs2.7 billion; growing by 28 percent year on year.

The company is a market leader in the two-wheeler industry and contributed to about 60 percent of the motorbike demand catered to by the local players. The company also announced large investment plans (to the tune of $100 million) for the capacity enhancement of its plant site in Shaikapura from 0.75 million to 1.35 million units annually at the back of expected demand projections.