MUGHAL - 3QFY23 Result Review - Earnings up 170%QoQ, (AKD Off the Analyst's Desk Apr 28, 2023)
Mughal Iron & Steel Industries Ltd (MUGHAL) reported its 3QFY23 earnings earlier today, wherein the company posted Profit After Tax (PAT) of PkR1.30bn (EPS: PkR3.89) for the quarter, higher by 1.7x/56% QoQ/YoY — lower than our estimate of EPS: PkR4.95/sh.
- Net sales for the period clocked in at PkR17.24bn, relatively flat on a QoQ basis, however higher by 14%YoY. Given the sharp increase in retail prices, the unmoved topline vs. the previous quarter may be due to reduction in volumes on a QoQ basis (possibly by 10-12%QoQ).
- Gross margins clocked in at 18.9%, possibly due to inventory gains amid sharp increases in retail prices of long-steel goods (PkR/USD depreciation and raw material shortages) during the outgoing period alongside available low-cost scrap inventories amidst relatively unrestricted imports for MUGHAL
- Operating expenses (S&D and Admin expenses) clocked in at PkR250mn, higher by 33%. This was majorly due to higher admin expenses, possibly due to salary adjustment in amidst beginning of the new-year.
- Effective tax clocked in at 31.5% during the period (vs. tax reversal of PkR427mn last quarter).
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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