Author Topic: AGTL -- Al Ghazi Tractors Limited  (Read 57658 times)

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Offline SBM

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Re: AGTL -- Al Ghazi Tractors Limited
« Sticky post on: August 17, 2012, 12:46:57 PM »
Dear all,
AGTL's ordinary shares have a paid up value of 5 rupees not 10 rupees. Please keep in mind while calculating dividend yields. For instance, the dividend announced for 1st half 2012 as 150% is 7.5 rupees NOT 15 rupees.
I hate waking up.

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Re: AGTL -- Al Ghazi Tractors Limited
« Reply #-1 on: August 17, 2012, 12:46:57 PM »

Toshi

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AGTL -- Al Ghazi Tractors Limited
« on: October 10, 2008, 03:47:20 PM »
All About Al Ghazi Tractors Limited
« Last Edit: February 07, 2012, 01:13:43 PM by M&M »

Offline Papa Jee

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Re: AGTL -- Al Ghazi Tractors Limited
« Reply #1 on: September 20, 2009, 03:01:39 PM »
Alghazi tractors is also a god stock but underperforming these days.

Offline Admin

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Re: AGTL -- Al Ghazi Tractors Limited
« Reply #2 on: December 04, 2009, 09:23:50 AM »
Tractors: AL-GHAZI TRACTORS LIMITED - Analysis of Financial Statements December 2004 - September 2009

OVERVIEW (December 04 2009): General overview of the economy: The agricultural sector of Pakistan has suffered major jolts due to country's near default situation, severe energy shortages, political and economic uncertainty and shrinking of agri-credit.

All these factors have profoundly impacted the performance of the automobile sector, particularly the tractors. The agri-credit assigned to the sector is much less than what it is required to meet the adequate demand, as the current credit requirement is Rs 553 billion whereas the current credit disbursement is only Rs 250 billion, indicating a huge shortfall of Rs 303 billion that need to be infused in the sector.

There is a huge demand of tractors from the farming fraternity. Approximately 218,607 applications submitted under the Green Tractor Scheme. Out of which only 10,000 were accepted. The existing credit structure as provided by the Zarai Taraqiyati Bank Limited (ZTBL) and various government-sponsored schemes like the Green Tractor Scheme and prospective Benazir Bhutto Scheme are unfortunately not enough to satisfy the demands of this crucial sector. Furthermore, there is a need to introduce the policies that will benefit the local manufacturers and not encourage the imports in order to save the foreign exchange and utilize the spare domestic capacity.

RECENT RESULTS 3Q09

During the period of Jul-Sep 2009, 6,763 tractors were produced, reaching a total production of 22,396 tractors during the period Jan-Sep 2009, compared with 20,003 units produced during the same period last year. For the first three quarters of the year 2009 (Jan-Sep), the company has sold 23,770 tractors compared with 19,996 tractors during the same period last year. On sales of 23,770 tractors during the first three quarters of 2009, the company has earned a pre-tax profit of Rs 1.877 billion, compared to Rs 1.437 billion during the same period last year. Sales increased by 44% to Rs 11,351 million, while the cost of goods sold increased by 46%. Distribution costs and administrative charges were well contained with only minimal increases.

COMPANY OVERVIEW

Al-Ghazi Tractors Limited (AGTL) engages in the manufacture and sale of agricultural tractors, implements, and spare parts in Pakistan. It manufactures tractors of various models, including 480-S (55 horsepower), GHAZI (65 horsepower), 640 (75 horsepower), and 640 Special (85 horsepower). The company was founded in 1983 and is headquartered in Karachi. Al-Ghazi Tractors Limited is a subsidiary of Al-Futtaim Industries Company LLC, having a lion's share of 50.02% followed by 43.17% by CNH Global NV, with whom AGTL has entered into a collaboration agreement for manufacturing new Holland brand of tractors. This agreement is expected to last till April 2016.

The company has completed its capacity expansion in FY06, as a result, enhancing the capacity by 100%. Now, with an annual assembling capacity of 30,000 units and capacity utilisation of more than 100%, Al-Ghazi Tractors is country's largest tractor manufacturer. The year 2008 saw a remarkable new record set by Al-Ghazi Tractors with the production of 27,750 tractors against 26,380 tractors produced in 2007. However, despite the increase in the production figures the sales remained stagnant.

This was due to the fact that the Government of Punjab reverted on its promise of a subsidy under the Green Tractor Scheme leading to lower than expected sales despite no fault at the company's end. GoP booked a total of 6,100 tractors for 2008 with a subsidy of Rs 200,000 on each and ended up procuring 2,594 less than the invoiced amount. Not only did the GoP defy on their words, they also persisted that Ghazi Tractors may reduce the selling price of the tractors in the market. The government's unforeseen demands had an adverse effect and Ghazi Tractors had to halt the supply of tractors to the lucky winners under the scheme despite having made their payments. However, following the resolution of the dispute, tractors were supplied to the winners of the scheme at a reduced price by the company.

RATIO ANALYSIS

As far as the profitability of Al-Ghazi Tractors is concerned, the company saw a decline in gross and net profit in FY08. The gross profit fell by 4.6% from Rs 1.65 million in FY07 to Rs 1.57 million in FY08. Net profit for the same period fell by a greater 12% between FY07 and FY08. Therefore, the gross profit margin fell from 18.2% in FY07 to 15.6% in FY08 and the net profit margin plunged from 13.96% to 11% in FY08. The fall in the profits were largely on account of sales lower than the production with a total of 27,550 tractors produced whereas only 24,985 sold. Likewise, the Return on Assets (ROA) and Return on Equity (ROE) both experienced a fall with ROA dipping from 18.56% in FY07 to 15.71% in FY08 and ROE coming down from 32.9% in FY07 to 25.14% in FY08.

ROA fell on the back of a 12% decline in the net profit against a 3.8% rise in the company's assets, whereas, the ROE fell due to the plummeting net profit and constant level of equity (21,468 shares). An assessment of the Asset Management shows an increase in inventory turnover accompanied by a drop in the Day Sales Outstanding. Inventory Turnover rose by 143% from 28.5 days in FY07 to 69.3 days in FY08 reflecting a longer time to sell and replenish inventory, This refers to the scenario mentioned above regarding the discord with the GoP over the promised subsidy and 2594 tractors sold lower than expected.

The Day Sales Outstanding fell from 0.96 in FY07 to 0.25 in FY08 as the trade debts fall by 70% in FY08. Consequently, the Operating Cycle climbed up from 29.5 days in FY07 to 69.6 days in FY08 indicating that Al-Ghazi Tractors might have confronted some issues in converting its credit sales into cash hence a lengthier operating cycle. Total Asset Turnover rose from 1.33 in FY07 to 1.43 in FY08. The Sales to Equity Ratio fell by 3.2%, from 2.36 in FY07 to 2.28 in FY08. The slump in this indicator is attributed to the glitches in the sales of the tractors regarding the dispute with the government.

Furthermore, the sales rose by 11% between FY07 and FY08 whereas the equity rose by a disproportionate 14% leading to a fall in the Sales to Equity ratio of the company. Al-Ghazi Tractors was slightly trapped with the liquidity in FY08 owing to a few major factors. Firstly, the government's sudden and unexpected reversal of their subsidy policy under the Green Tractor Scheme leading to a decline in sales of 2594 tractors.

Secondly, ZTBL's failure to encash bank drafts of Rs 298.4 million, which later climbed to Rs 471.4 million, exacerbated the liquidity position. Adding to the problem was Federal Bureau of Revenue's (FBR) inefficiency and delay in refunding the sales tax paid by the company. All these factors contributed to the decline in the liquidity in FY08 and hence a rise in the Current Ratio from 2.24 in FY07 to 2.62 in FY08. An evaluation of the Debt Management capabilities of Al-Ghazi Tractors shows rising long-term debt to equity ratio paired falling debt to equity.

Long-term debt to equity ratio rose slightly from 0.98% in FY07 to 1.05% in FY08 due to a rise in non-current liabilities, mainly deferred taxation which, rose by 39%. Debt to equity ratio, however, fell from 0.77 in FY07 to 0.6 in FY08 since the total debt fell by 11% and total equity rose by approximately 15%. Event though the non-current liabilities rose, the current liabilities in FY08 fell by a huge amount causing a decline in the total debt relative to FY07 (mostly due to a fall in unclaimed dividends and customers advanced payments.) The Debt-to-Asset ratio declined from 43.59% in FY07 to 37.51% in FY08 showing faster increase in total assets relative to total debt.

This could indicate that the company's assets are less dependant on borrowed funds despite a record high level of production in FY08. It must be mentioned here that despite the record high production numbers, the sales volume remained unchanged from FY07 indicating that there was a heavy inventory pile up as shown by the rise in inventory turnover ratio. We can therefore conclude that the record high production figures didn't translate into sales and accumulated as inventory instead due to the subsidy dispute with the government. The Times Interest Earned (TIE) ratio fell from 637 in FY07 to 617 in FY08 indicating lower bank charges paid out. Declining net profits led to a fall in earnings per share, which dipped from Rs 29.52 in FY07 to Rs 25.93 in FY08.

FUTURE OUTLOOK

Various schemes of the government under which the tractors were to be given at subsidised rates are rolling and the execution would imply good turnover for the company.

========================================================================================
AL-GHAZI TRACTORS LIMITED-KEY FINANCIAL DATA
========================================================================================
Income Statement (Rs'000)          FY'04       FY'05       FY'06      FY '07       FY'08
----------------------------------------------------------------------------------------
Sales                          6,735,195   7,739,322   9,022,515   9,081,310  10,107,874
Cost of goods sold            -5,136,710  -6,136,774  -7,387,468  -7,427,824  -8,530,087
Distribution cost                -53,328     -61,403     -65,152     -67,145     -75,286
Administrative expenses          -68,427     -79,744     -80,043     -85,845     -91,560
Operating Profit (EBIT)        1,490,434   1,643,073   1,912,941   1,917,466   1,685,675
Financial Charges                 -6,245      -7,517      -2,761      -3,012      -2,734
Net Income Before Taxes        1,484,189   1,635,556   1,910,180   1,914,454   1,682,941
Net Income After Taxes           964,785   1,060,873   1,229,318   1,267,410   1,113,256
----------------------------------------------------------------------------------------
Balance Sheet (Rs'000)             FY'04       FY'05       FY'06      FY '07      FY '08
----------------------------------------------------------------------------------------
Stores & Spares                    8,847      15,316       8,118      10,442      14,673
Stock in Trade                   647,986     740,140     731,002     708,733   1,931,399
Cash & Bank Balances           2,050,184   5,017,307   5,142,121   4,384,551   3,348,997
Total Current Assets           4,059,887   7,056,152   7,025,286   6,581,042   6,840,054
Property, Plant & Equipment       84,911     158,513     252,243     244,928     235,452
Total Assets                   4,180,152   7,245,461   7,278,389   6,827,308   7,086,010
Total Current Liabilities      1,545,098   4,155,274   3,698,853   2,938,224   2,611,710
Total Liabilities              3,274,872   3,274,873   3,274,874   3,274,875   3,274,875
Paid Up Capital                  195,165     214,682     214,682     214,682     214,682
Total Equity                   2,616,088               3,549,880   3,851,221   4,427,772
----------------------------------------------------------------------------------------
LIQUIDITY RATIO                    FY'04       FY'05       FY'06      FY '07      FY '08
----------------------------------------------------------------------------------------
Current Ratio                       2.63        1.70        1.90        2.24        2.62
----------------------------------------------------------------------------------------
ASSET MANAGEMENT                   FY'04       FY'05       FY'06      FY '07      FY '08
----------------------------------------------------------------------------------------
Inventory Turnover(Days)           35.11       30.14       34.38       28.51       69.31
Day Sales Outstanding (Days)        0.41        0.28        0.28        0.96        0.25
Operating Cycle (Days)             35.51       30.42       34.67       29.47       69.57
Total Asset turnover                1.61        1.25        1.06        1.33        1.43
Sales/Equity                        2.57        2.94        2.18        2.36        2.28
----------------------------------------------------------------------------------------
DEBT MANAGEMENT                    FY'04       FY'05       FY'06      FY '07      FY '08
----------------------------------------------------------------------------------------
Debt to Asset(%)                   37.42       57.60       51.23       43.59       37.51
Debt/Equity (Times)                 0.60        1.36        1.05        0.77        0.60
Times Interest Earned (Times)     238.66      692.84      218.58      636.61      616.56
Long Term Debt to Equity(%)         0.72        0.59        0.84        0.98        1.05
----------------------------------------------------------------------------------------
PROFITABILITY (%)                  FY'04       FY'05       FY'06      FY '07      FY '08
----------------------------------------------------------------------------------------
Gross Profit Margin                23.73       18.12       20.71       18.21       15.61
Net Profit Margin                  14.32       13.63       13.71       13.96       11.01
Return on Asset                    23.08       16.97       14.58       18.56       15.71
Return on Common Equity            36.88       40.02       29.88       32.91       25.14
----------------------------------------------------------------------------------------
PER SHARE                          FY'04       FY'05       FY'06      FY '07      FY '08
----------------------------------------------------------------------------------------
Earning per share                  22.47       24.71       28.63       29.52       25.93
Price earning ratio                 6.94        7.97        7.50        8.52           -
Dividend per share                 15.00       17.50       17.50       17.50       12.50
Book value                        134.04      143.09      165.36      179.39      206.25
========================================================================================
COURTESY: Economics and Finance Department, Institute of Business Administration, Karachi

Toshi

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Re: AGTL -- Al Ghazi Tractors Limited
« Reply #3 on: December 20, 2009, 08:33:17 PM »
Buy AGTL with stop below 224 for 1st of 242 trend is bullish

Toshi

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Re: AGTL -- Al Ghazi Tractors Limited
« Reply #4 on: December 21, 2009, 11:34:38 PM »
Still bullish go for it

Toshi

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Re: AGTL -- Al Ghazi Tractors Limited
« Reply #5 on: December 23, 2009, 08:17:50 PM »
Al – Ghazi Tractors Limited (AGTL)
9MCY09 Review
AGTL posted robust earnings of PKR28.63/share (PKR1.2bn), up 28%YoY during 9MCY09 compared to the same
period last year. The primary factor behind growth in the company’s bottom line is 44%YoY surge in AGTL’s topline to
PKR11.3bn. 19%YoY growth in volumetric sales has led to the soaring topline of the
company. However, gross margins of the company declined marginally to 16%
during 9MCY09 compared to 17% in the
corresponding period of last year. Al –Ghazi Tractors also declared interim dividend to the tune of PKR5/share during 9MCY09.

Road Ahead
Going forward, we expect company to post earnings of PKR44.68/share (PKR1.9bn) during CY09, up 72%YoY. At yesterday’s closing price
of PKR239.66/share, AGTL is trading at an attractive CY09E P/E of 5.3x.

Toshi

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Re: AGTL -- Al Ghazi Tractors Limited
« Reply #6 on: January 19, 2010, 09:29:54 AM »
Buy AGTL with stoploss below 244,bullish trend.

Offline ihashishin

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Re: AGTL -- Al Ghazi Tractors Limited
« Reply #7 on: January 21, 2010, 01:50:53 PM »
Buy AGTL with stoploss below 244,bullish trend.

i would put the stop closer to 237
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Offline sadlik

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Re: AGTL -- Al Ghazi Tractors Limited
« Reply #8 on: February 07, 2010, 05:57:05 PM »
strong buy call for AGTL......

Offline Karuli

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Re: AGTL -- Al Ghazi Tractors Limited
« Reply #9 on: February 08, 2010, 11:54:27 AM »
strong buy call for AGTL......

 :welldone:

Offline sadlik

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Re: AGTL -- Al Ghazi Tractors Limited
« Reply #10 on: February 08, 2010, 02:31:55 PM »
buy AGTLLLLLLLLLLLLLLLLLLLLLLLLL

janay na pai  :khikhi:

Offline ihashishin

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Re: AGTL -- Al Ghazi Tractors Limited
« Reply #11 on: February 08, 2010, 03:07:01 PM »
Buy AGTL with stoploss below 244,bullish trend.

i would put the stop closer to 237

it turned around from 236.99  :smoky:
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Offline niaz.ahmed

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Re: AGTL -- Al Ghazi Tractors Limited
« Reply #12 on: February 08, 2010, 03:19:05 PM »
bhai agtl aur mtl ki bm kab hay?

Offline ihashishin

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Re: AGTL -- Al Ghazi Tractors Limited
« Reply #13 on: February 08, 2010, 03:54:06 PM »
bhai agtl aur mtl ki bm kab hay?

AGTLs meeting is on the 15

dont know about millat...
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Offline ::WASIF::

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Re: AGTL -- Al Ghazi Tractors Limited
« Reply #14 on: February 14, 2010, 04:58:27 PM »
millat ke 16 ko hay dono ka aik he din result ayaa ga
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Offline ::WASIF::

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Re: AGTL -- Al Ghazi Tractors Limited
« Reply #15 on: February 14, 2010, 04:59:31 PM »
ye ais dafa bonus day sakta hay ya nahii
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Offline ::WASIF::

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Re: AGTL -- Al Ghazi Tractors Limited
« Reply #16 on: February 16, 2010, 01:01:48 AM »
subah result hay ais ka koi b lift nahi karara raha ais ko  :fingerscrossed1:
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Offline Farzooq

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Re: AGTL -- Al Ghazi Tractors Limited
« Reply #17 on: February 16, 2010, 09:47:48 AM »
eps 40.6 dps 15
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Offline Abdul Qadir

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Re: AGTL -- Al Ghazi Tractors Limited
« Reply #18 on: February 16, 2010, 11:11:15 AM »
great result............:D :banana:

Offline ihashishin

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Re: AGTL -- Al Ghazi Tractors Limited
« Reply #19 on: February 16, 2010, 01:18:54 PM »
not so great i was expecting a higher payout, on avg they pay out 60%+ of profits this time only 49% 

i wonder why :what4:
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