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Atul Auto (NSE:ATULAUTO) Financial Strength : 7 (As of Dec. 2023)


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What is Atul Auto Financial Strength?

Atul Auto has the Financial Strength Rank of 7.

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.

Atul Auto's Interest Coverage for the quarter that ended in Dec. 2023 was 3.98. Atul Auto's debt to revenue ratio for the quarter that ended in Dec. 2023 was 0.00. As of today, Atul Auto's Altman Z-Score is 4.89.


Competitive Comparison of Atul Auto's Financial Strength

For the Auto Manufacturers subindustry, Atul Auto's Financial Strength, along with its competitors' market caps and Financial Strength data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


Atul Auto's Financial Strength Distribution in the Vehicles & Parts Industry

For the Vehicles & Parts industry and Consumer Cyclical sector, Atul Auto's Financial Strength distribution charts can be found below:

* The bar in red indicates where Atul Auto's Financial Strength falls into.



Atul Auto Financial Strength Calculation

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

Atul Auto's Interest Expense for the months ended in Dec. 2023 was ₹-32 Mil. Its Operating Income for the months ended in Dec. 2023 was ₹127 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Dec. 2023 was ₹0 Mil.

Atul Auto's Interest Coverage for the quarter that ended in Dec. 2023 is

Interest Coverage=-1*Operating Income (Q: Dec. 2023 )/Interest Expense (Q: Dec. 2023 )
=-1*127.3/-32
=3.98

The higher the ratio, the stronger the company's financial strength is.

2. Debt to revenue ratio. The lower, the better.

Atul Auto's Debt to Revenue Ratio for the quarter that ended in Dec. 2023 is

Debt to Revenue Ratio=Total Debt (Q: Dec. 2023 ) / Revenue
=(Short-Term Debt & Capital Lease Obligation + Long-Term Debt & Capital Lease Obligation) / Revenue
=(0 + 0) / 6054.8
=0.00

3. Altman Z-Score.

Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

The zones of discrimination were as such:

When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.

Atul Auto has a Z-score of 4.89, indicating it is in Safe Zones. This implies the Z-Score is strong.

Good Sign:

Altman Z-score of 4.89 is strong.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Atul Auto  (NSE:ATULAUTO) Financial Strength Explanation

The maximum rank is 10. Companies with rank 7 or higher will be unlikely to fall into distressed situations. Companies with rank of 3 or less are likely in financial distress.

Atul Auto has the Financial Strength Rank of 7.


Atul Auto Financial Strength Related Terms

Thank you for viewing the detailed overview of Atul Auto's Financial Strength provided by GuruFocus.com. Please click on the following links to see related term pages.


Atul Auto (NSE:ATULAUTO) Business Description

Traded in Other Exchanges
Address
National Highway 8-B, Survey No. 86, Near Microwave Tower, Plot No. 1 - 4, Shapar (Veraval), Rajkot District, Rajkot, GJ, IND, 360024
Atul Auto Ltd is an Indian-based automobile manufacturing company. It manufactures and sells three-wheeled commercial automobiles in the domestic and overseas markets. The product portfolio of the company includes Atul Shakti, Atul Gem, Atul Smart, Atul Gemini, Atul RIK, and Atul Elite. The company has a presence in India as well as exports its products internationally. The majority of the revenue is earned from the domestic market. It operates in the following segment namely Automotive Vehicles and Parts and Non-Banking Financial Business.

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