November 09, 2021 (MLN): Indus Motor Company (IMC) is set to increase auto prices of all its models by 5-6% in two phases during the ongoing week due to rising raw material input costs and depreciation, the company’s management said during a corporate briefing session held on Tuesday.
IMC said the impact of new prices will come into effect from January on wards while adding that price hike will be less than its competitors due to higher localization of production chain.
The company’s management disclosed that despite rupee depreciation of around 8% during the first quarter of current fiscal year, the company was able to maintain its margins owing to availability of low-cost inventory obtained during Apr-June quarter.
However, the company warned that December quarter margins will decline on account of no increase in sale prices, sharp uptick in raw material prices and currency depreciation.
IMC, which assembles Toyota brand vehicles in the country, recorded record-high sales during 1QFY22 as total units sold reached 18,855 units, jumping by around 60% from 11,809 during the same period last year. The robust sales came on the back of strong demand of Yaris and face lift models of Corolla (X), Fortuner and Hilux.
The company’s top line grew by 92%YoY to Rs65.5 billion during 1QFY22 on the back of strong demand in the high-end models of Fortuner and Hilux.
The company also informed that the expansion project to increase production capacity will come online in April, 2022 to meet rising demand for its models.
With regards to the prudential regulations announced by the State Bank of Pakistan (SBP) to curtail auto financing, the company said that the move will hurt Fortuner sales as around 25% of the model’s sales are financed through banks. Meanwhile, the impact of regulations will have a muted impact on Hilux since only 10-15% of the model’s total sales are financed through banks.
