Atul Auto Limited is one of India’s top five three-wheeler manufacturers, established in 1970, with a mission to uplift lives through affordable mobility solutions.
The company produces vehicles across diesel, petrol, CNG, LPG, and electric platforms, catering to domestic and international markets.
Operates in over 16 countries, with a pan-India distribution network and a focus on last-mile connectivity and rural accessibility.
Internal Combustion Engine (ICE) vehicles: Diesel cargo/passenger, CNG, and petrol variants.
Electric vehicles (EVs): L5 category electric three-wheelers under Atul Greentech Private Limited (AGPL).
Export operations: Vehicles sold in Latin America, Africa, and Asia, with plans to expand to 33 countries by FY2025.
Financing arm: Khushbu Auto Finance Limited (KAFL) provides vehicle loans to customers and fleet operators.
Growth thesis
Atul Auto manufactures diesel, CNG, and electric three-wheelers for cargo and passenger segments. Key growth triggers include expanding electric vehicle (EV) adoption (improved EVs planned for Q2/Q3 FY2019), geographic expansion into 33 countries within five years, and dealer network growth to 220-225 primary dealers by FY2019. Management has consistently overpromised on export volumes (targeting >500 units/month next fiscal) and Ahmedabad plant timelines (deferred to FY2020+), with FY17 exports averaging only 190/month. Over the next 2-3 years, EV and alternative fuel vehicle rollouts could drive incremental revenue, but delayed CAPEX execution and unmet BS-VI engine development timelines remain critical risks. EBITDA margins are expected to stabilize at 17-18% as cost efficiencies offset transition costs.
Why is Atul Auto Limited stock rising?
Targeting export volumes of more than 500 vehicles per month next fiscal (FY2019)
Aiming for export revenue contribution of over 10% to total operating revenue
Greenfield expansion at Ahmedabad: all approvals secured, land leveling done, commercial production decision deferred until 75-80% capacity utilization at existing plant
Electric three-wheeler: improved version to be introduced in Q2/Q3 of next fiscal; currently in Gujarat and Bihar, expanding to full network within 2-3 months
Alternative fuel (CNG/LPG/petrol) three-wheeler: homologated by ARAI, state approvals expected by end of fiscal; entering Maharashtra market gradually
Research report
companyname: Atul Auto Limited
ticker: ATULAUTO
sector: Automobile – Three-wheeler manufacturing
Atul Auto Limited is a manufacturer of three-wheeled vehicles for passenger and cargo transport. The company was founded in 1970, began operations by repurposing golf carts into local transport in Saurashtra, and today ranks among India's top five three-wheeler makers. It sells vehicles running on diesel, petrol, CNG, LPG, and electric power.
The company operates two manufacturing plants: one at Sh...
capex, margin expansion, regulatory approval, new product segment
Growth guidance
No guidance
Management consistency
hype man
RS rating: 33Stage: Stage 3
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