Pakistan Cement_Profitability for 3QFY21 increased by 100%QoQ,(AKD Daily, May 20, 2021)
AKD Daily
Pakistan Cement: Profitability for 3QFY21 increased by 100%QoQ
- AKD Cement universe posted a stellar increase in profitability of 100%QoQ as profit after tax stood at PkR12.5bn for 3QFY21 while gross margins stood at 30% against 4/25% for 3QFY20/2QFY21.
- Profitability for 9MFY21 stood at PkR22.2bn against a loss of PkR2.5bn as gross margins improved to 25% from 7% in 9MFY20 on the back of players engaging in severe price competition during 9MFY20 in the backdrop of North witnessing a significant increase in capacity.
- Company wise, LUCK continues to maintain the status of lowest cost producer with highest gross margins from our universe of 36% while LUCK also posted the highest QoQ increase in profitability as dividend from LMC drove unconsolidated profit to PkR7.2bn.
- We maintain our optimism on the local cement sector as local cement demand remains upbeat (up 19% for 10MFY21) which is expected to continue supporting pricing power of local players as they look to pass on the impact of increasing coal prices. MLCF (TP: PkR80.1/sh), DGKC (TP: Pk209.7/sh) and LUCK (TP: PkR1289.5/sh) stand as our top picks from the AKD cement universe.
AKD Research
Co. is engaged in the production and sale of Ordinary Portland and Sulphate Resistant Cements.
AKD Securities Ltd. is one of the leading securities firm in Pakistan, providing a comprehensive range of investor focused services, including equity brokerage, economic and securities research, investment banking and financial advisory services. AKD Securities accounts for more than 6% of the average daily value of the Karachi Stock Exchange. AKD Securities was the first brokerage house to launch an online trading platform in Pakistan in November 2002 and now has the largest market share with over 6000 customers. This has helped diversify and expand the retail investor base in the country and ushered in a whole new universe of investors to the stock market.
AKD Securities Ltd. caters to a diversified group of domestic and international institutional investors, high net worth individuals and upscale retail clients, including expatriate Pakistanis. With high quality research, unparalleled execution and distribution capability for both regular and large block trades, AKD Securities Ltd. has earned an outstanding reputation in the Pakistani securities industry.Outside of commercial banks, AKD Securities Ltd. is one of the biggest capital market firms in the country. AKD Securities is the leader in raising and providing risk capital in underwriting, market making and mergers and acquisitions in Pakistan. Good corporate governance and professionalism are emphasized throughout the firm and AKD Securities Ltd. is amongst the very few companies to have introduced a firm-wide comprehensive CODE of ETHICS, overseen by an independent compliance manager.Ultimately, our success is based on the quality of service we provide to our customers and the trust and confidence reposed in us by them. Our focus, therefore, remains on customer satisfaction at all levels in the company.
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