Latest news with #HCAR
Business Recorder
6 days ago
- Automotive
- Business Recorder
Honda's lane
Whether Honda Atlas Cars (PSX: HCAR) becomes an exporter of Honda vehicles assembled in Pakistan still remains to be seen, a future that hinges on the cost competitiveness and demand feasibility in attractive markets. At the same time though, one cannot deny that HCAR is financially trudging out of misery. Profits in the first quarter of MY26 are up 4 times compared to the low base in 1Q last year. While this is not the best quarterly profits the company has made in recent history, the average earnings for the past three quarters is almost double the average earnings for the same quarters the year before. The average volumetric increase during this time is 40 percent. There is certainly a favorable demand environment, especially with the reduction of interest rates and the resurgence of bank credit for consumer automobiles. In 1QMY26 (ending June-25), volumes surged 68 percent driven by City and civic sales (BR-V was only 7% of total volumetric sales) which led to a revenue growth of 66 percent. Honda's cost per unit sold is down 4 percent, contributing to a slight improvement in margins. However, revenue per unit sold declined by 1 percent, suggesting a possible shift in the sales mix toward lower-priced is also evident from the reduced share of BR-V compared to last year. Certainly, the increased demand is expected to taper off in the coming quarter, particularly due to new budgetary measures such as carbon levies that have triggered upward price adjustments for most models. With strong control over overheads (4% of revenue) and financial costs (1% of revenue), partially offset by other income (2% of revenue), what Honda needs now is sustained demand. The company's launch of a hybrid vehicle in the C-segment SUV category aligns with its domestic assembly strategy. While the model will compete with the already popular Corolla Cross, for Honda loyalists, the launch appears well-timed. The exports meanwhile are mostly symbolic at this time. Unlike the domestic market where competition is hard to fathom, automotive exports are highly competitive with more ready and advanced exporters already in the market unwilling to give out their market share. In this case, several East Asian exports are already at a significant advantage. While Honda claims a high degree of localization, 74 percent for the Honda City; 64 percent for the Civic, and 61percent for the hybrid HR-V, the cost of many localized parts remains sensitive to exchange rate fluctuations, as most raw materials are still imported. Other factors such as high taxation environment are also not conducive to producing an export competitive product. Honda must weigh its export aspirations against the harsh realities of highly competitive international markets. But this is as good a start as any.
Business Recorder
22-05-2025
- Automotive
- Business Recorder
Honda Atlas Cars' posts Rs2.7bn profit in 2025
Honda Atlas Cars (Pakistan) Limited (HCAR) registered a profit of Rs2.7 billion for the year ended March 31, 2025, a significant increase of 16% on a year-on-year basis. HCAR's financial statements, which were made available at the Pakistan Stock Exchange (PSX) on Thursday, showed that the company's profit stood at Rs2.3 billion in the same period last year. The automaker's earnings per share (EPS) stood at Rs18.97 during the year, compared to Rs16.34 last year. A final cash dividend for the year ended March 31, 2025 at Rs8 per share i.e. 80%. The increase in profit can be attributed to an increase in sales. During the year, HCAR's sales clocked in at Rs78.06 billion, compared to Rs55.07 billion in SPLY, an increase of 42%. Honda Atlas Cars' profit-after-tax up 295% YoY in Oct-Dec While the company's cost of sales also rose to Rs71.4 billion in 2025, an increase of 41%. Consequently, the company's gross profit increased by nearly 48%, clocking in at Rs6.7 billion in 2025, as compared to a gross profit of Rs4.5 billion in SPLY. As a result, HCAR's gross margins improved to 8.5% in 2025, compared to 8.2% in the last fiscal. Meanwhile, as per HCAR's latest financial results, the automobile company witnessed a jump in its administrative expenses, which stood at Rs1.9 billion in 2025, up by 28%, as compared to Rs1.5 billion in SPLY. On the other hand, HCAR's other income registered a decline of over 56%, amounting to a meagre Rs988 million in 2025, in comparison to Rs2.25 billion in 2024. The automaker saw its finance cost lowered by 15%, standing at Rs1.04 billion in 2025, as compared to Rs1.2 billion in SPLY. The company posted a Profit before Taxation (PBT) of Rs3.27 billion in 2025, up by 19% YoY. Incorporated in Pakistan as a public limited company in 1992, HCAR commenced its commercial operations in 1994. The company was formed as a result of a joint venture between Honda Motor Co., Ltd., Japan and Atlas Group of Companies, Pakistan.
