Pak Suzuki Term Report

BUSINESS DESCRIPTION............................................................................................................
1
VISION............................................................................................................................................1
MISSION.........................................................................................................................................1
PRODUCTS.....................................................................................................................................1
Current Vehicle Models:..............................................................................................................2
Former Vehicles:..........................................................................................................................2
COMPANY INFORMATION.........................................................................................................4
COMPANY PROFILE....................................................................................................................6
ANALYSIS OF BALANCE SHEET...........................................................................................8
ANALYSIS OF PROFIT OR LOSS ACCOUNT.....................................................................10
PROFITABILITY RATIO:........................................................................................................13
LIQUIDITY RATIO..................................................................................................................16
ACTIVITY RATIO....................................................................................................................18
ASSETS EFFICIENCY RATIO:...............................................................................................20
SOLVENCY RATIO.................................................................................................................21
Recommendation:..........................................................................................................................23
Conclusion:....................................................................................................................................24
REFERENCES..............................................................................................................................24
Pak Suzuki Motor Company Limited
BUSINESS DESCRIPTION
Pak Suzuki Motor Company Limited was incorporated in Pakistan as a public limited company
in August 1983. The Company was formed in accordance with the terms of a joint venture
agreement concluded between Pakistan Automobile Corporation Limited and Suzuki Motor
Corporation, Japan (the Holding Company). The Company is engaged in the assembling,
progressive manufacturing and marketing of Suzuki cars, pickups, vans, 4x4s and motorcycles
and related spare parts.
Located in Karachi, employs 3000 peoples & having production capacity of 150,000 per annum,
the largest state-of-art production facility in Pakistan. Pak Suzuki has a vast portfolio of products
i.e. 12 car models, 7 Motorcycle & Heavy Bikes Models and 2 models of outboard motors. The
product range expands from entry level small cars like Mehran 800 to the luxury sedan Ciaz.
VISION
To be recognized as a leading organization that values customers’
needs and provides motoring solutions with strong customer care
MISSION
Develop products of superior value by focusing on the customer
Establish a refreshing and innovative company through teamwork
Strive for individual excellence through continuous improvement
PRODUCTS
Current Vehicle Models:
Suzuki Alto (Eighth Generation):
Offered in three variants: VX, VXR, and VXL.
All variants equipped with a 3-cylinder 658cc R06A engine.
AGS automatic transmission available as an option on VXR and standard on VXL.
Suzuki Bolan:
Seventh generation Suzuki Carry manufactured in two variants: Suzuki Bolan (passenger van)
and Suzuki Ravi (pick-up truck).
Both variants feature a 796cc Suzuki F8B engine and a 4-speed manual transmission.
Suzuki Cultus (Celerio):
Second generation Suzuki Celerio sold under the 'Cultus' brand name.
Available in two variants: Suzuki Cultus VXR and Suzuki Cultus VXL.
Features a 3-cylinder 996cc Suzuki K10B engine, with automatic transmission optional on VXL.
Suzuki Wagon R:
Second generation Suzuki Wagon R (MP31S) offered in two variants: Wagon R VXR and
Wagon R VXL.
Equipped with a 996cc Suzuki K10B engine, similar to the Suzuki Cultus.
Suzuki Swift (Third Generation - A2L):
Introduced in 2022, available in two variants: Suzuki Swift GL and Suzuki Swift GLX.
Features a 4-cylinder 1197cc Suzuki K12M engine, with a choice of a 5-speed manual or CVT
automatic transmission.
Former Vehicles:
Suzuki Baleno (SY413):
Assembled in Pakistan from 1998 to 2006, introduced as a replacement for Suzuki Margalla.
Featured advancements like standard power steering, wider tires, and EFI.
Initially offered in trim levels GL, GXi, Gli, and GliP.
Suzuki FX:
Produced between 1982-1988, a modified version of Suzuki Alto SS40.
Featured a 796cc F8B engine, with options like air conditioning.
Suzuki Khyber:
Production ceased in 2000, succeeded by the Suzuki Cultus.
Suzuki Kizashi:
Introduced in 2015 and discontinued in 2016 due to poor sales.
Suzuki Liana:
Replaced the Baleno, initially with 1.6-litre engines.
Suzuki Margalla:
Introduced in 1990, assembled locally under the name Suzuki Margalla, succeeded by Baleno
in 1998.
Suzuki Mehran:
Began production in 1988, received minor facelifts, and discontinued in 2019.
Suzuki Potohar:
Produced as Suzuki Samurai by Santana Motors, locally assembled as Suzuki Potohar using
the chassis code SJ410.
Discontinued in 2006 without a direct replacement.
Motorcycles (As of 2023):
Suzuki GD110S (4-stroke, 113 cc)
Suzuki GSX125 (4-stroke, 125 cc)
Suzuki GS150 (4-stroke, 150 cc)
Suzuki GR150 (4-stroke, 150 cc)
COMPANY INFORMATION
Board of Directors
Kinji Saito Chairman
Masafumi Harano Chief Executive
Tadashi Homma Dy. Managing Director

Motohiro Atsumi Director
Kensaku Imaizumi Director
Moin M. Fudda Director
Rukhsana Shah Director
Chief Financial Officer
Toshiyuki Ikuma
Company Secretary
Abdul Nasir
Audit Committee
Moin M. Fudda Chairman
Kinji Saito Member
Motohiro Atsumi Member
Human Resource and Remuneration
(HR & R) Committee
Rukhsana Shah Chairman
Kinji Saito Member
Masafumi Harano Member
Auditors
KPMG Taseer Hadi & Co. Chartered Accountants
Registrar
CDC Share Registrar Services Limited
CDC House, 99 - B, Block “B”, S.M.C.H.S, Main

Shahrah-e-Faisal Karachi-74400.
Legal Advisors
M/s Shahid Anwar Bajwa & Co.
ORR Dignam & Company
Bankers
Bank Alfalah Ltd.
Bank Al Habib Ltd.
Citibank N.A.
Habib Bank Ltd.
Habib Metropolitan Bank Limited
MCB Bank Ltd.
National Bank of Pakistan
Standard Chartered Bank (Pakistan) Ltd.
Meezan Bank Limited
Registered Office
DSU-13, Pakistan Steel Industrial
Estate, Bin Qasim, Karachi.
Tel No. (021) 34723551 - 58
Fax No. (021) 34723521 - 22
Website: www.suzukipakistan.com
Regional Offices
Karachi Office:
REGIONAL OFFICE SOUTH, PLOT # 49-B, Block # 6,
PECHS MAIN SHAHRA-E-FAISAL, KARACHI.
Tel No. (021) 34541101, (021) 34541102

Lahore Office:
1st Floor, Silver Star Mall, Fortress Stidium, Lahore.
Tel No. (042) 36623339, (042) 36688853
Rawalpindi Office:
3rd Floor, 112-B Mallahi Plaza,
Murree Road, Rawalpindi Cantt.
Tel No. (051) 5130230 - (051) 5130229
Fax No. (051) 5130232
Multan Office:
402, 4th Floor United Mall, Abdali Road Multan.
Tel No. (061)-4586499
Fax No. (061)-4516765
COMPANY PROFILE
Location
Downstream Industrial Estate of Pakistan Steel, Karachi
Total Area
259,200 m2 (64 acres)
Facilities
Press Shop, Welding Shop, Paint Shop, Plastic Shop,
Engine and Transmission Assembly Shop, Final Assembly
& Hi-Tech Inspection Shop. The Company has also
established a modern Waste Water Treatment Plant as
its contribution to the preservation of environment.
Cost
Rs. 40.23 billion

Production Capacity (double shift)
Car & LCV’s Plant
150,000 units per annum
Motorcycles Plant
44,000 units per annum
Profile
Pak Suzuki Motor Company Limited (PSMCL) is a public limited company with its shares quoted
on Pakistan Stock Exchange. The Company was formed in August 1983 in accordance with the
terms of a joint venture agreement between Pakistan Automobile Corporation Limited
(representing Government of Pakistan) and Suzuki Motor Corporation (SMC) Japan.The
Company started commercial production in January 1984 with the primary objective of
progressive manufacturing, assembling and marketing of Cars, Pickups, Vans and 4x4 vehicles
in Pakistan. The Company’s long term plans inter-alia include tapping of export markets.
The foundation stone laying ceremony of the Company’s existing plant located at Bin Qasim
was performed in early 1989 by the Prime Minister then in office. By early 1990, on completion
of first phase of this plant, in-house assembly of all the Suzuki engines started. In 1992, the
plant was completed and production of the Margalla Car commenced.
Under the Government’s privatization policy, the Company was privatized and placed under the
Japanese management in September 1992. At the time of privatization, SMC increased its
equity from 25% to 40%. Subsequently, SMC progressively increased its equity to 73.09% by
purchasing remaining shares from PACO. The Suzuki Management immediately after
privatization started expansion of the existing plant to increase its installed capacity to 50,000
per annum. The expansion was completed in July 1994.
However the capacity remained substantially underutilized until 2002 because of economic
recession. Thereafter realizing growth in demand, the Company increased capacity in phases.
The first phase was completed in January 2005 when capacity was enhanced to 80,000
vehicles. The second phase was completed in January 2006 and capacity was raised to
120,000. The third phase was completed when on 6th February 2007, Prime Minister of
Pakistan, Mr. Shaukat Aziz inaugurated 150,000 vehicles capacity expansion facilities.
On 25th April 2007, the Board of Directors of Pak Suzuki Motor Company Limited (PSMCL) and
Suzuki Motorcycles Pakistan Limited (SMPL) approved Scheme of Arrangement (The Scheme)
to amalgamate SMPL into PSMCL with effect from 1st January 2007. The scheme was
approved by the shareholders of the respective Companies at the Extra - Ordinary General
Meeting held on 30th June 2007. The scheme was sanctioned by the Honourable High Court of
Sindh (the court) on 17th September 2007. The certified copy of the Order of the Court
sanctioning the scheme was filed with the Registrar Companies Karachi on 1st October 2007,
from which date the scheme became operative.
PSMCL and Suzuki Motor Corporation (SMC) Japan held 41% and 43% shares in SMPL
respectively. Pak Suzuki issued and allotted 1,233,300 ordinary shares of Rs.10/- each to the
qualifying shareholders of SMPL @ one ordinary share in Pak Suzuki for every twenty one
shares held by SMPL shareholders as on the date of final book closure i.e. 29th October 2007.
The trading in shares of SMPL on Karachi and Lahore Stock Exchanges ceased from the same
date.
The Company setup a new plant for motorcycles at Bin Qasim. All the operations of motorcycles
have been shifted to the new plant effective from July 2011. The Company continues to be in
the fore-front automobile industry of Pakistan. Over a period of time, the Company has
developed an effective and comprehensive network of sales, service and spare parts dealers
who cater to the needs of customers and render effective after-sale service country wide. Joint
Venture Agreement was signed between Pak Suzuki Motor Company Limited and Tecno Pack
Telecom (Private) Limited to set up Tecno Auto Glass Limited (“TAG”). TAG’s main area of
operations will be manufacturing, development and designing of Auto Glass products to cater
local as well as international Markets.
FINANCIAL ANALYSIS
ANALYSIS OF BALANCE SHEET

Assets:
Fixed Assets:
Decreased by 3.8% in 2022 compared to 2021.
Increased by 19.9% in 2021 compared to 2020.
Right to Use of Assets:
Decreased by 14.5% in 2020 compared to the previous year.

Long-term Investments:
Deferred Taxation:
No percentage change in 2022 compared to 2021.
Increased significantly by 169.9% in 2020 compared to 2019.
Liabilities and Equity:
Share Capital:
Reserves:
Trade and Other Payables:
Short-term Finance:
Employee Benefit Obligations:

Overall Financial Position:
Total Assets:
Total Equity and Liabilities:
ANALYSIS OF PROFIT OR LOSS ACCOUNT

Revenue:
Sales:
Cost of Sales:

Increased by 1.6% in 2019 compared to 2018
Gross Profit:
Operating Expenses:
Distribution and Selling Costs:
Administrative Expenses:
Other Expenses:
Experienced a significant decrease of 96.8% in 2022 compared to 2021.
Increased by 62.8% in 2019 vs. 2018:
Provision for Impairment Losses:
Operating Profit:
The operating profit increased significantly by 100.8% in 2022 compared to 2021.
In 2021, the operating profit showed a remarkable increase of 1882.96% compared to 2020.
There was a substantial decrease of 104.4% in 2020 compared to 2019.
Decreased by 57.0%. In 2019 as compared to 2018
Other Income:
Increased by 215.7%. 2020 vs. 2019:
Decreased by 60.6%. 2019 vs. 2018:
Share of Loss of Equity Accounted Investee:
Increased by 1500.0%. 2020 vs. 2019:
Finance Cost:
Experienced a significant increase of 1475.8% in 2022 compared to 2021.
2020 vs. 2019: Increased by 27.6%.
Increased by 475.2%. 2019 vs. 2018:
(Loss) / Profit Before Taxation:
Showed a remarkable increase of 1882.96% in 2021 compared to 2020.
Decreased by 61.9%. 2020 vs. 2019:
Decreased by 337.7%. 2019 vs. 2018:
Taxation:
Experienced a significant increase of 186.2% in 2022 compared to 2021.
Showed a remarkable decrease of 318.82% in 2021 compared to 2020
(Loss) / Profit After Taxation:
Showed a remarkable increase of 294.41% in 2021 compared to 2020.
Decreased by 52.8%. 2020 vs. 2019:
Increased by 66.1%. 2019 vs. 2018:
RATIO ANALYSIS
PROFITABILITY RATIO:
Gross Profit Ratio:
Gross Profit Ratio=(Gross Profit / Net Sales) ×100
Year: 2022 Gross Profit Ratio: 5.76%
Operating Profit Margin:
Operating Profit Margin= (EBIT / Net Sales)×100
Year: 2022 Operating Profit Margin: -1.55%

Pre-tax Margin (Financial Cost Ratio):
Pre-tax Margin=( EBT/ Net Sales)×100
Year: 2022 Pre-tax Margin: -1.55%
Net Profit Margin (EAT):
Net Profit Margin=(NET PROFIT / Net Sales)×100
Year: 2022 Net Profit Margin: -3.13%
Return on Equity (ROE):
ROE=(Net Profit / Average Equity)×100
Average Equity=Equity for the Current Year+Equity for the Previous Year/2
Year: 2022 ROE: -26.95%
Year: 2021 ROE: -13.57%
Year: 2020 ROE: -6.77%
Year: 2019 ROE: -11.26%
Return on Assets (ROA):
ROA=(Net Profit / Average Total Assets)×100
Average Total Assets=Total Assets for the Current Year+Total Assets for the Previous Year / 2
Year: 2022 ROA: -5.45%
Year: 2021 ROA: -2.92%
Year: 2020 ROA: -2.00%
Year: 2019 ROA: -4.05%

Analysis
Gross Profit Ratio:
The Gross Profit Ratio indicates the proportion of sales revenue that exceeds the cost of goods
sold (COGS).
In 2022, the Gross Profit Ratio increased to 5.76%, reflecting a better ability to control
production costs.
Over the years, there has been a consistent improvement in the Gross Profit Ratio, suggesting
efficiency in managing production costs.
Operating Profit Margin:
The Operating Profit Margin represents the percentage of profit generated from operating
activities.
Negative values in 2022 and previous years indicate operational losses. There might be
challenges in managing operating expenses and generating sufficient revenue.
Continuous negative margins may require a review of cost structures and business operations
for efficiency.
Pre-tax Margin (Financial Cost Ratio):
The Pre-tax Margin signifies the percentage of profit before taxes relative to net sales.
Negative margins indicate losses before tax. The business may be experiencing financial
challenges, and the cost structure needs evaluation.
Net Profit Margin (EAT):
The Net Profit Margin reflects the portion of sales that translates into net profit.
Negative margins suggest overall losses, emphasizing the need for a comprehensive review of
cost management and revenue generation.
Return on Equity (ROE):
ROE measures how effectively the company is utilizing shareholders' equity to generate profit.
Negative ROE in 2022 indicates a loss relative to equity. This is a concerning sign, and
strategies to improve profitability and/or reduce equity should be considered.
Return on Assets (ROA):
ROA gauges how efficiently assets are used to generate profit.
Negative ROA in 2022 suggests challenges in utilizing assets effectively to generate profits.
A consistent negative trend in ROA requires a thorough examination of asset utilization
strategies.
Interpretation:
The negative profitability ratios across various metrics in 2022 and preceding years indicate
financial challenges.
Key areas for improvement include cost management, operational efficiency, and revenue
generation.
The business should conduct a detailed financial and operational analysis to identify root
causes and implement corrective measures.
Consideration of restructuring strategies, cost-cutting, and revenue enhancement may be

necessary to improve overall profitability.
Collaboration with financial experts or consultants might be beneficial in formulating a

comprehensive turnaround strategy.
LIQUIDITY RATIO
Current Ratio:
Current Ratio=Current Assets / Current Liabilities
2022: 0.35 2021: 0.90 2020: 1.43 2019: 1.30 2018: 1.40
Quick Ratio (Acid-Test Ratio):
Quick Ratio=Current Assets - Inventory - Prepayment / Current Liabilities
2022: 0.25 2021: 0.59 2020: 0.99 2019: 1.06 2018: 0.97
Analysis
Current Ratio:
The Current Ratio measures the company's ability to cover short-term obligations with its short-
term assets.
In 2022, the current ratio is significantly lower at 0.35, indicating a potential liquidity issue and
challenges in meeting short-term obligations.
A declining trend from 2018 to 2022 suggests a consistent deterioration in the company's short-
term financial health.
Quick Ratio (Acid-Test Ratio):
The Quick Ratio provides a more stringent measure of short-term liquidity by excluding
inventory and prepayments.
In 2022, the quick ratio is 0.25, further emphasizing the potential liquidity challenges, as it is
lower than the current ratio.
The declining trend from 2018 to 2022 indicates a weakening ability to cover short-term
obligations without relying on the sale of inventory.
Interpretation:
The notable decline in both the Current Ratio and Quick Ratio from 2018 to 2022 suggests a
deteriorating liquidity position.
A Current Ratio below 1 indicates that the company may struggle to meet its short-term
obligations with its current assets.
The Quick Ratio being lower than the Current Ratio indicates that the inventory might not be
easily convertible to cash, adding to liquidity concerns.
The company may face challenges in paying off its short-term debts, and potential cash flow
issues could affect day-to-day operations.
It is crucial to identify the root causes of the declining liquidity trend, such as inefficient working
capital management, high short-term liabilities, or declining cash reserves.
The company should consider implementing measures to improve liquidity, such as optimizing
inventory levels, negotiating better credit terms with suppliers, or exploring additional financing
options.
Continuous monitoring of liquidity ratios is essential, and proactive measures should be taken to
address any emerging issues promptly.
ACTIVITY RATIO
Inventory Turnover (ITO):
ITO=Cost of Sales / Average Inventory
Average Inventory=Stock in Trade for the Current Year+Stock in Trade for the Previous Year / 2
2022: 5.94 times

2021: 6.49 times
2020: 5.89 times
2019: 5.16 times
Receivable Turnover (RTO):
RTO=Net Sales / Average Trade Debtors
Average Trade Debtors=Trade Debts for the Current Year+Trade Debts for the Previous Year /
2
2022: 4.93 times
2021: 4.76 times
2020: 3.88 times
2019: 3.60 times
Payable/Creditor Turnover:
Payable Turnover=Cost of Sales / Average Trade Creditors
Average Trade Creditors=Trade and Other Payables for the Current Year+Trade and Other
Payables for the Previous Year / 2
022: 7.34 times
2021: 6.64 times
2020: 7.21 times
2019: 7.09 times
Operating Cycle:
Operating Cycle=ITO+RTO−PT0
2022: 3.53 days
2021: 4.15 days
2020: 2.56 days
2019: 4.41 days

Analysis
Inventory Turnover (ITO):
Inventory Turnover measures how efficiently a company manages its inventory by indicating
how many times it sells and replaces its inventory during a period.
In 2022, ITO is 5.94 times, which indicates that the company is selling and replacing its
inventory approximately 5.94 times during the year.
The increasing trend in ITO from 2019 to 2021 suggests improved efficiency in managing
inventory.
Receivable Turnover (RTO):
Receivable Turnover assesses how well a company collects payments from its customers.
In 2022, RTO is 4.93 times, indicating that the company is collecting payments from customers
approximately 4.93 times during the year.
The increasing trend in RTO from 2019 to 2022 implies an improvement in the company's ability
to collect receivables promptly.
Payable/Creditor Turnover:
Payable Turnover measures how quickly a company pays its suppliers.
In 2022, Payable Turnover is 7.34 times, suggesting that the company is paying its suppliers
approximately 7.34 times during the year.
The increasing trend in Payable Turnover from 2019 to 2022 indicates a more frequent payment
cycle.
Operating Cycle:
The Operating Cycle represents the time it takes for a company to convert its inventory into
cash.
In 2022, the Operating Cycle is 3.53 days, showing the company takes approximately 3.53 days
to complete one operating cycle.
The decreasing trend in the Operating Cycle from 2019 to 2022 indicates an improvement in the
efficiency of the company's operating cycle.
Interpretation:
The increasing trends in Inventory Turnover and Receivable Turnover suggest improved
efficiency in managing inventory and collecting receivables over the years.
A higher Payable Turnover indicates that the company is paying its suppliers more frequently,
potentially leveraging favorable credit terms.
The decreasing trend in the Operating Cycle implies that the company is becoming more
efficient in converting inventory into cash.
Overall, these activity ratios suggest that the company has been successful in optimizing its
inventory management, improving receivables collection, and efficiently managing its payables,
contributing to a shorter operating cycle.
ASSETS EFFICIENCY RATIO:

Total Assets Turnover:
Assets Turnover=Net Sales / Average Total Assets
Average Total Assets=Total Assets for the Current Year+Total Assets for the Previous Year / 2
2022: 1.59 times
2021: 1.76 times
2020: 1.86 times
2019: 2.00 times
Total Fixed Assets Turnover:
Fixed Assets Turnover=Net Sales / Average Total fixed Assets
Average Total Fixed Assets=Total Fixed Assets for the Current Year+Total Fixed Assets for the
Previous Year / 2
2022: 17.21 times
2021: 19.14 times
2020: 19.72 times
2019: 22.31 times
Analysis
Total Assets Turnover:
Total Assets Turnover measures how efficiently a company utilizes its total assets to generate
sales.
In 2022, Total Assets Turnover is 1.59 times, suggesting that the company generates $1.59 in
sales for every $1 of average total assets.
The decreasing trend in Total Assets Turnover from 2019 to 2022 indicates a potential decline
in the efficiency of utilizing total assets to generate sales.
Total Fixed Assets Turnover:

Total Fixed Assets Turnover assesses how well a company utilizes its fixed assets to generate
sales.
In 2022, Total Fixed Assets Turnover is 17.21 times, meaning the company generates $17.21 in
sales for every $1 of average total fixed assets.
The decreasing trend in Total Fixed Assets Turnover from 2019 to 2022 suggests a potential
decline in the efficiency of utilizing fixed assets to generate sales.
Interpretation:
A decreasing trend in both Total Assets Turnover and Total Fixed Assets Turnover may indicate
a decline in the company's efficiency in utilizing its assets to generate sales.
It's essential to investigate the reasons behind these trends. For instance, an increase in total
assets without a proportional increase in sales could contribute to lower turnover ratios.
A detailed examination of the company's investment decisions, asset management strategies,

and business operations is necessary to identify the factors influencing these ratios.
Additionally, a comparison with industry benchmarks can provide insights into how the
company's asset efficiency ratios compare to its peers.
SOLVENCY RATIO
Debt to Assets Ratio:
Debt to Assets Ratio=Total Non-Current Liabilities / Total Assets
2022: 0.36
2021: 0.36
2020: 0.40
2019: 0.52
Debt to Equity Ratio:
Debt to Equity Ratio=Total Non-Current Liabilities / Total Equity
2022: 0.36
2021: 0.36
2020: 0.40
2019: 0.52
Financial Leverage Ratio:
Financial Leverage Ratio= Total Assets / Total Equity
2022: 1.57
2021: 1.46
2020: 1.34
2019: 1.41
Interest Coverage Ratio:
Interest Coverage Ratio=EBIT / Finance Cost
2022: -0.27
2021: -1.25
2020: -1.05
2019: -1.04
Analysis
Debt to Assets Ratio:
The Debt to Assets Ratio measures the proportion of a company's assets financed by debt.A
lower ratio is generally favorable, indicating lower financial risk.
The decreasing trend in the Debt to Assets Ratio from 2019 to 2022 suggests a positive trend,
indicating a lower reliance on debt to finance assets.
A ratio below 0.5 indicates that more than half of the assets are financed by equity.
Debt to Equity Ratio
The Debt to Equity Ratio evaluates the proportion of equity and debt used to finance the
company's assets. A lower ratio is generally considered less risky.
Consistent with the Debt to Assets Ratio, the Debt to Equity Ratio shows a decreasing trend,
indicating reduced financial leverage.
A ratio below 0.5 signifies that debt is a smaller portion of the company's capital structure
compared to equity.
Financial Leverage Ratio:
The Financial Leverage Ratio indicates how much debt a company uses to finance its assets
relative to equity.A higher ratio implies higher financial risk.
The increasing trend in the Financial Leverage Ratio indicates a rise in financial leverage from
2019 to 2022.
A ratio above 1 suggests that the company relies more on debt than equity to finance its assets.
Interest Coverage Ratio:
The Interest Coverage Ratio assesses a company's ability to cover interest expenses with its
operating income.A higher ratio is desirable as it indicates better capacity to meet interest
obligations.
The negative values indicate that operating income may not be sufficient to cover interest
expenses in the given years.
The declining trend from 2019 to 2022 raises concerns about the company's ability to meet
interest obligations.
Interpretation:
The decreasing Debt to Assets and Debt to Equity Ratios suggest a positive financial trend,
indicating a lower reliance on debt for asset financing.
The increasing Financial Leverage Ratio implies rising financial risk due to increased reliance
on debt.
The negative trend in the Interest Coverage Ratio requires careful attention, as it indicates
potential challenges in meeting interest payments.
Recommendations include monitoring debt management strategies, exploring options to

improve interest coverage, and assessing the overall impact on financial stability.
Recommendation:
Operational Efficiency: Implement cost-saving measures to address the increase in
distribution and selling costs, ensuring efficient resource allocation.
Financial Health: Monitor and manage the increasing trend in short-term finance and employee
benefit obligations to maintain financial stability.
Investment Strategy: Reevaluate the investment portfolio strategy to reverse the declining
trend in long-term investments.
Conclusion:
The financial analysis reveals both strengths and areas for improvement. While revenue and
gross profit show positive trends, operational expenses require attention. Liquidity ratios indicate
a need for effective working capital management. The company's investment portfolio and debt
ratios should be carefully reviewed to ensure a balanced and sustainable financial structure.
Overall, a proactive approach to cost management and strategic financial planning will
contribute to long-term financial health and stability.
REFERENCES
https://suzukipakistan.com/media/corporate/Financial-Reports/Suzuki%20Annual%20Report
%202022.pdf
https://www.investing.com/equities/pak-suzuki-mot-ratios
https://scstrade.com/stockscreening/SS_CompanySnapShotYR.aspx?symbol=PSMC
https://kasb.com/blog/psmc-corporate-briefing-session-key-takeaways/
https://suzukipakistan.com/automobile-detail?automobile=4ax7c9h2sn3ec4brxpnvvbh5cm
https://www.pacra.com/summary_report/RR_1928_10265_05-Aug-22.pdf
https://www.pacra.com/summary_report/RR_1928_8566_31-Dec-20.pdf

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Pak Suzuki Term Report

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BUSINESS DESCRIPTION............................................................................................................

Pak Suzuki Motor Company Limited

needs and provides motoring solutions with strong customer care

Establish a refreshing and innovative company through teamwork

Strive for individual excellence through continuous improvement

Suzuki Alto (Eighth Generation):

Offered in three variants: VX, VXR, and VXL.

All variants equipped with a 3-cylinder 658cc R06A engine.

AGS automatic transmission available as an option on VXR and standard on VXL.

Suzuki Swift (Third Generation - A2L):

Suzuki Baleno (SY413):

Initially offered in trim levels GL, GXi, Gli, and GliP.

Produced between 1982-1988, a modified version of Suzuki Alto SS40.

Featured a 796cc F8B engine, with options like air conditioning.

Production ceased in 2000, succeeded by the Suzuki Cultus.

Replaced the Baleno, initially with 1.6-litre engines.

Began production in 1988, received minor facelifts, and discontinued in 2019.

Discontinued in 2006 without a direct replacement.

Motorcycles (As of 2023):

Suzuki GD110S (4-stroke, 113 cc)

Suzuki GSX125 (4-stroke, 125 cc)

Suzuki GS150 (4-stroke, 150 cc)

Suzuki GR150 (4-stroke, 150 cc)

Kinji Saito Chairman

Masafumi Harano Chief Executive

Tadashi Homma Dy. Managing Director

Kensaku Imaizumi Director

Moin M. Fudda Director

Rukhsana Shah Director

Chief Financial Officer

Moin M. Fudda Chairman

Kinji Saito Member

Motohiro Atsumi Member

Human Resource and Remuneration

(HR & R) Committee

Rukhsana Shah Chairman

Kinji Saito Member

Masafumi Harano Member

KPMG Taseer Hadi & Co. Chartered Accountants

CDC Share Registrar Services Limited

CDC House, 99 - B, Block “B”, S.M.C.H.S, Main

M/s Shahid Anwar Bajwa & Co.

ORR Dignam & Company

Bank Alfalah Ltd.

Bank Al Habib Ltd.

Habib Bank Ltd.

Habib Metropolitan Bank Limited

MCB Bank Ltd.

National Bank of Pakistan

Standard Chartered Bank (Pakistan) Ltd.

Meezan Bank Limited

DSU-13, Pakistan Steel Industrial

Estate, Bin Qasim, Karachi.

Tel No. (021) 34723551 - 58

Fax No. (021) 34723521 - 22

REGIONAL OFFICE SOUTH, PLOT # 49-B, Block # 6,

PECHS MAIN SHAHRA-E-FAISAL, KARACHI.

Tel No. (021) 34541101, (021) 34541102

1st Floor, Silver Star Mall, Fortress Stidium, Lahore.

Tel No. (042) 36623339, (042) 36688853

3rd Floor, 112-B Mallahi Plaza,

Murree Road, Rawalpindi Cantt.

Tel No. (051) 5130230 - (051) 5130229