Amtek Auto Share Price near its 52 week low, due to high Debt burden

Amtek Auto Share Price has touched 52 week high of Rs. 176.05 on 03- Aug-15 and 52 week low of Rs. 25.20 on 04-Sep-15.

Amtek Auto Share Price has shown sharp fall of (-78%) in last one year:

1. Due to the poor performance of the company from June quarter ending 2015
2. The stock was removed from the derivatives list
3. There are market rumors of the company being on the verge of a default on its huge debt payment.

Amtek Auto Ltd was incorporated in the year 1988 is headquartered in New Delhi, is one of the largest integrated automotive component manufacturers in India with a strong global presence. The company has world class facilities in Europe, North America, and India. The company has significant expertise in forging, gravity and high-pressure aluminum die casting, gray and ductile iron casting and machining and sub-assembly. The company’s products and services include connecting rods assembly/piston assembly, case component assemblies and forging. Amtek Auto also manufactures components for non-auto sectors such as the specialty vehicles, aerospace, railways, agricultural and heavy earth moving equipment. The company operates in the segment which includes Automotive Components.

Forging division has manufacturing facilities in

1. Maharashtra
2. Northern Capital Region
3. Madhya Pradesh

Automotive Machining Division has facilities in

1. Rajasthan
2. Uttarakhand
3. Maharashtra
4. Missouri

Financial update

During the quarter ended 31st March 2016, the net sales of the company reported a decline of 46.65% on the Y-o-Y basis to Rs. 651.02 cr as against Rs. 954.68 cr during the corresponding quarter last year.

The operating performance of the company witnessed a loss of Rs. -26.69 cr on the Y-o-Y basis as against a profit of Rs. 133.31 cr in the same quarter last year. This is mainly due to the decline in sales of the company by 46.65 %.

The company has reported a net loss of Rs. -528.69 cr as on quarter ended 31st March 2016, compared to a net profit of Rs. 129.82 cr during the corresponding quarter last year.

The FII’s have reduced their position from 13.17% to 3.22% which gives us the sign of alert for the stock. During the quarter ended 31st March 2016, the interest paid by the company has increased to Rs. 289.81 cr as against Rs. 171.70 cr during the corresponding quarter last year.

Rising interest cost depicts that the company has increased its debt. However, proper deployment of debt is important along with the rise in sales and profit otherwise rising interest will eat the profitability of Amtek Auto.

The stock is currently trading at Rs. 33.65. The market cap of the company is 756.30 cr and the book value of the company is 212.11 the stock is among all NSE stock as per Dynamic Levels.

A writer by day and a passionate reader by night. Writing just doesnot fill my pocket but it also fills my heart. With over 4 years experience in Stock Market, I am a full time content writer with www.dynamiclevels.com