Topline Securities Limited - Indus Motor Company (INDU): 1QFY21 EPS at Rs23.5, up 40% YoY (below industry expectations)

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Topline Securities Limited

Fawad Basir

EUR 25.00 For Business Accounts Only

Indus Motor Company (INDU): 1QFY21 EPS at Rs23.5, up 40% YoY (below industry expectations)

Indus Motor Company (INDU) announced earnings of Rs1,845mn in 1QFY21 (EPS: Rs23.5), up 40% YoY.
Along with the result, company also announced an interim cash dividend of Rs12.0/share.
The company’s revenues increased by 65% YoY In 1QFY21, mainly attributable to 74% YoY rise in unit sales.
The demand for new cars returned strongly as lockdown was lifted following decline in COVID-19 cases and lower interest rates.
Gross margins for the quarter came in at 6.7%, lower from 9.7% seen in the same quarter last year.
Although QoQ margins improved significantly, they still came in lower than market expectations.
Other Income depicted an increase 57% YoY and 25% QoQ respectively, largely due to higher cash balance from increased order intake.

Effective taxation for the quarter clocked in at 30% compared to 26% for the same period last year.

28/10/2020 2 EN

Provider

Topline Securities Limited

Topline Securities is one of the fastest-growing brokerage houses in Pakistan. It has strong Equity Brokerage, Economic/ Equity Research, Commodity Trading and Corporate Finance & Advisory functions.

Topline Securities has been endowed with numerous awards by renowned international financial organizations. The highlights of which consists of the award for ‘Best Local Brokerage House of Pakistan’ by Asiamoney Brokers Poll (the largest Asia-focused equity services provider poll) in 2016 and ‘Best Equity Brokerage House’ by CFA Society Pakistan in 2015.

Previously, Topline Securities held the title for ‘Best Brokerage House’ for 4 consecutive years (2011-2014) by Asiamoney Brokers Poll. Other awards include the ‘Best Salesperson’ award by Asiamoney for 6 consecutive years (2011-2016), the ‘Arabia Fast Growth 500’ award and ‘Pakistan Fast Growth 100’ award in 2012 and 2013 by AllWorld Network.

JCR-VIS, a credit rating agency providing independent rating services in Pakistan has assigned initial rating of “A-2” for short term and “A” for long term to Topline Securities. Topline Securities is registered as Underwriter, Book Runner and Research Entity with Securities & Exchange Commission of Pakistan (SECP).

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Analysts

Fawad Basir

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Indus Motor Company (INDU): 1QFY21 EPS at Rs23.5, up 40% YoY (below industry expectations)

Pakistan Strategy: Foreign selling at PSX; Will this trend continue in 2021?

Pakistan Strategy: Pakistan Outlook 2021 based on Topline Poll

Pakistan Automobiles: Car sales (including KIA) up ~63% YoY in Nov-2020

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