EUR 25.00 For Business Accounts Only

Topline Flash Note: Indus Motor Company (INDU): Corporate Briefing Session Notes

• Auto industry’s sales, as a whole, are expected to reach 185K units during FY21. However, if current trend continues, sales can surpass the 200k barrier. To recall, these levels are still significantly lower than +300k sales units seen in FY18.
• The company is gradually ramping up production in order to meet demand and is expected to reach 6k units/month in Jan-2021 with double shift and overtime. The company is targeting 70k units/annum on double shift basis.
• The order book duration currently stands between 2 - 2.5 months, with 50% of it coming from Toyota Yaris.
• The management informed that around 37% of total Yaris sales are concentrated in the ATIV x CVT 1.5L spec.
• Order of the 1.6L and 1.8L Grande variants are on hold as a new facelift model is expected in Jan-2021. The pricing and specs of the new facelift are expected to be announced shortly.
• The margins in 1QFY21 were low due to various factors which included (1) higher vendor costs, (2) different vehicle mix, (3) PKR depreciation and (4) the fact that Yaris is a smaller car compared to Corolla thereby lower margins especially in initial stages of production.
• The company’s focus has been on cutting costs which were primarily achieved by reducing fixed costs.
• On the auto policy, the management indicated that talks are still in initial stages. However, the company aims to push for a longer term strategy.
• FED on Hilux is being charged on customers placing order after June 30, 2020.
• The management feels that higher competition is good for the market and is geared up to tackle new challenges heads on.

New CBU Toyota Cross is expected to be introduced to the market in Jan-2021.