KARACHI: Atlas Honda, the motorcycle maker, has announced that it plans to increase the production capacity up to 1.5 million units.
The announcement comes on a day when the company also announced its financial results for the year ended March 31, in which it registered a 24.28% increase in earnings and announced a dividend of Rs27 for its shareholders.
Atlas Honda recorded a profit after tax of Rs4.66 billion in its fiscal year 2018, compared to Rs3.75 billion in the previous year, an increase of 24.28%.
“Sales of Honda motorcycles are increasing, which have improved the profitability of the company. Moreover, the market was already expecting the announcement of an increase in production capacity,” said Hamdan Altaf, Taurus Securities’ analyst.
“The increase in sales of motorcycles has a direct relationship with population and GDP growth. The company mainly caters to the class that is price elastic.”
The company experienced an increase in revenue from last year’s Rs64.5 billion to Rs77.5 billion, a change of 20%. Atlas Honda Limited, a joint venture of Atlas Group and Honda Motor Company, has approved a two-year phase-wise expansion plan to increase capacity at an estimated cost of $15 million.
Atlas Honda sold 838,395 units for the period July-March 2018 compared with 711,395 units for the same period last year. The company also exports bikes to Sri Lanka, Afghanistan and Bangladesh.
Published in The Express Tribune, May 1st, 2018.