Lumax Auto Technologies (LAT) is a small cap (Rs 142 cr), fast growing auto components supplier to some of the well known auto majors. The promoters of LAT are also the promoters of Lumax Industries, the leader in automotive lighting systems.

LATL is primarily present in the lighting and sheet metal & fabrication spaces. Its main products include  headlamps, tail-lamps, blinkers, fog lamps, engine lamps, chassis assembly, silencers, petrol tank, fork assemblies, handle bar assemblies, stand assembly and frame sub assemblies, gear shift levers and parking brakes. The company caters to two, three and four wheeler market.

The company’s main customers include Bajaj Auto, Tata Motors, Maruti Suzuki, Hero Honda, Ashok Leyland, Force Motors, Eicher Group, Swaraj Mazda, Daimler, Nissan, Hyundai, Volvo, Maharashtra Scooters, TAFE and Lumax Industries.

LAT also has a 50% JV with Turin-based Cornaglia group for manufacture of emission systems. The JV has orders from Tata Motors, Fiat, Bajaj Auto, Volkswagen and Skoda India. The JV has planned to set up new facility to produce air intake systems locally that are being imported at present from Cornalgia, Italy.

To counter the risks of excessive client concentration, LAT continues to broaden the product portfolio, increase customer profile and geographic reach and also enters into after market segment which now constitutes approximately 50% of the total revenue.

Over the past 5 years (FY05-10), the company managed to grow its revenues by 40% and net profits by 65%, despite a flat FY09. It also generated positive cash from operations during this period. The Company has negligible debt.

Keeping in view the past execution track record of the company and future high growth prospects of the Indian auto sector, the current valuations of LAT (P/E of 6.2 and P/B of 1.7) appear quite attractive and have the potential of market beating returns over the next few years.

Thanks for providing this information. I find the stock still attractively priced. I am looking to evaluate the future growth scope.

i was hunting 4 this thread .. .. ..
boring business , good mkt presence , good margins ... seems the mgmt is also decent . .

I havent carried out a comparative analysis bet Lumax, motherson n hitech but have noticed flwg points .

- Motherson has a debt of 1262 cr. ( rev 8410 ). Lumax has debt of only 3.4 cr (rev 631 cr)., hitech gears - 54 cr (rev 427 cr)

- For FY 10-11, Lumax has a much better ROCE .
- The Earnings yield ( EBIT / EV) for lumax at present share price is also much better ( 24 %) then motherson ( 9 %)

Hi tech gears is also attractively priced but it is also a small cap.

I dont have much idea about expected future growth in revenues for these companies.
Also I have done the comparison for only 1 year , a five year analysis will give better indication.