D.G. Khan Cement Co.

Co. is engaged in the production and sale of Ordinary Portland and Sulphate Resistant Cements.
  • TickerDGKC
  • ISINPK0052401012
  • ExchangePakistan Stock Exchange
  • SectorConstruction & Materials
  • CountryPakistan
Rahul Hans

Pakistan Cements: More cost reliefs raise estimates

We have upgraded our Cement Universe estimates with c.13% higher TPs on average, in light of the reduction in FED in FY21 Budget, much lower coal prices, and the 100bps cut in interest rates in June. We think that cement demand and prices will rebound strongly 2HFY21 onwards, on the back of potentially higher public infrastructure spending – the low-cost housing scheme will likely gain pace – and softer macros leading to greater private construction activity as well. We have an Overweight sta...

Shahrukh Saleem

Pakistan Cement_COVID-19 taking its toll on dispatches (AKD Daily, Jun 04, 2020)

Pakistan Cement_COVID-19 taking its toll on dispatches Local cement dispatches for May’20 declined by 37.7%YoY as COVID-19 related restrictions, rainfall and slowdown in sales due to ramzan took its toll. For 11MFY20, local dispatches have declined by 2.7%YoY and now stand at 36.1mn tons. Exports from North took a significant hit, declining by 95.4%YoY as border controls were imposed due to COVID-19 outbreak while South’s exports were dented by restrictions in place at export destinations. Local prices in North have held their ground despite the questions raised by authorities though fu...

Rahul Hans

Pakistan Cement: Upgrade estimates on significantly weaker cost pressures

Despite a slow demand outlook, the cement sector’s profitability is expected to re-surge in FY 21/22f due to significant cost savings, which back an average 6ppts expected increase in the sector’s gross margins. Key supporting factors are lower international oil and coal prices (energy cost savings) and steep decline in interest rates. We think cement demand and prices will rebound strongly 2HFY21 onwards when the Covid-19 pandemic will likely be more manageable and the government would likel...

Rahul Hans

DG Khan Cement: Q3 FY 20 review – In line with expectations; better results than peers so far

DGKC posted unconsolidated NLAT of PKR1.0bn (LPS: PKR2.29) in 3QFY20, in line with our expectations of NLAT of PKR920mn (LPS: PKR2.10). This took 9MFY20 LPS to PKR4.22. The decline in the quarter’s profitability is attributed to the combination of: (i) significant drop in retention prices in both local and export markets, (ii) a 5.3x yoy increase in finance cost, (iii) higher energy tariffs, and (iv) increase in transportation cost post implementation of axle load management. Note that 3Q res...

Rahul Hans

Pakistan Cements: 3QFY20 preview – the worst is not over yet

With a backdrop of lower retention prices, higher input costs, elevated finance costs and infighting among North-based producers, profitability of IMS cement universe is likely to remain depressed in 3QFY20, with an estimated cumulative net losses of PKR2.5bn. Almost all producers – including the less leveraged FCCL and KOHC – alongside CHCC, MLCF and DGKC are likely to book losses in 3Q amid (i) further compression of retention prices qoq (ii) increased competition, (iii) higher coal prices ...

1 director bought

A director at D.G.Khan Cement Co bought 100,000 shares at 50.880PKR and the significance rating of the trade was 53/100. Is that information sufficient for you to make an investment decision? This report gives details of those trades and adds context and analysis to them such that you can judge whether these trading decisions are ones worth following. Included in the report is a detailed share price chart which plots discretionary trades by all the company's directors over the last two years clearly showing Close periods where trading activity is restricted under listing rules. The names o...

Rahul Hans

Pakistan Cements: More cost reliefs raise estimates

We have upgraded our Cement Universe estimates with c.13% higher TPs on average, in light of the reduction in FED in FY21 Budget, much lower coal prices, and the 100bps cut in interest rates in June. We think that cement demand and prices will rebound strongly 2HFY21 onwards, on the back of potentially higher public infrastructure spending – the low-cost housing scheme will likely gain pace – and softer macros leading to greater private construction activity as well. We have an Overweight sta...

Shahrukh Saleem

Pakistan Cement_COVID-19 taking its toll on dispatches (AKD Daily, Jun 04, 2020)

Pakistan Cement_COVID-19 taking its toll on dispatches Local cement dispatches for May’20 declined by 37.7%YoY as COVID-19 related restrictions, rainfall and slowdown in sales due to ramzan took its toll. For 11MFY20, local dispatches have declined by 2.7%YoY and now stand at 36.1mn tons. Exports from North took a significant hit, declining by 95.4%YoY as border controls were imposed due to COVID-19 outbreak while South’s exports were dented by restrictions in place at export destinations. Local prices in North have held their ground despite the questions raised by authorities though fu...

Rahul Hans

Pakistan Cement: Upgrade estimates on significantly weaker cost pressures

Despite a slow demand outlook, the cement sector’s profitability is expected to re-surge in FY 21/22f due to significant cost savings, which back an average 6ppts expected increase in the sector’s gross margins. Key supporting factors are lower international oil and coal prices (energy cost savings) and steep decline in interest rates. We think cement demand and prices will rebound strongly 2HFY21 onwards when the Covid-19 pandemic will likely be more manageable and the government would likel...

Rahul Hans

DG Khan Cement: Q3 FY 20 review – In line with expectations; better results than peers so far

DGKC posted unconsolidated NLAT of PKR1.0bn (LPS: PKR2.29) in 3QFY20, in line with our expectations of NLAT of PKR920mn (LPS: PKR2.10). This took 9MFY20 LPS to PKR4.22. The decline in the quarter’s profitability is attributed to the combination of: (i) significant drop in retention prices in both local and export markets, (ii) a 5.3x yoy increase in finance cost, (iii) higher energy tariffs, and (iv) increase in transportation cost post implementation of axle load management. Note that 3Q res...

Rahul Hans

Pakistan Cements: 3QFY20 preview – the worst is not over yet

With a backdrop of lower retention prices, higher input costs, elevated finance costs and infighting among North-based producers, profitability of IMS cement universe is likely to remain depressed in 3QFY20, with an estimated cumulative net losses of PKR2.5bn. Almost all producers – including the less leveraged FCCL and KOHC – alongside CHCC, MLCF and DGKC are likely to book losses in 3Q amid (i) further compression of retention prices qoq (ii) increased competition, (iii) higher coal prices ...

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