Report
Team AKD Research
EUR 8.96 For Business Accounts Only

PSMC_3QCY21 EPS clocked in PkR12.07 - Above expectations, (AKD, Off the Analyst's Desk, Oct 28, 2021)

AKD, Off the Analyst's Desk

PSMC: 3QCY21 EPS clocked in PkR12.07 – Above expectations

  • Pak Suzuki Motor Company (PSMC) announced its 3QCY21 NPAT of PkR994mn (EPS: PkR12.07) as opposed to a loss of PkR547mn (LPS: PkR6.65) in 3QCY20, overshooting our estimates. This takes 9MCY21 NPAT to PkR2.2bn (EPS: PkR26.62) vs a loss of PkR2.6bn (LPS: PkR31.58) in same period last year.
  • The revenue increased by 122%YoY and 67%QoQ on account of aggressive volumetric growth (+120%YoY/+75%QoQ) where the budgetary measures sharply stimulated the demand.
  • Despite currency devaluation of ~6% in 3QCY21, the gross margin stood flat at 5.3% owing to abolishment in Additional Custom Duty (ACD) on CKD parts for 1000cc vehicles and below.
  • The contribution from other income stood at PkR423mn, translating into PkR3.65/sh after tax, increasing by 199%YoY/71%QoQ owing to increasing cash balance from customer advances.
  • We expect the automobile sales to remain robust in 4QCY21 owing to healthy order book where delivery times stretch beyond 3 months. We maintain our Buy stance on PSMC with Dec’22 target price of PkR268/sh, implying an upside of 25%.

AKD Research

Underlying
Pak Suzuki Motor Co. Ltd.

Pak Suzuki Motor is engaged in assembling, progressive manufacturing and marketing of Suzuki cars, pickups, vans, and 4X4 vehicles. Co.'s product models include Baleno, Margalla, Mehran, Kyber, Ravi Pickup, Bolan Van and Potohar Jeep.

Provider
AKD Securities Limited
AKD Securities Limited

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.

Analysts
Team AKD Research

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