Pak Elektron (PAEL): 3Q2020 EPS at Rs0.49 (in line with our expectations)
- Pak Elektron (PAEL) announced its 3Q2020 financial result today, where the company booked a profit of Rs253mn (EPS: Rs0.49) compared to a profit of Rs26mn (EPS: Rs0.03) in 3Q2019.
- It takes 9M2020 loss to Rs173mn (LPS: Rs0.41) compared to a profit of Rs301mn (EPS: Rs0.54) in 9M2019.
- Net Sales of the company increased by 167% YoY to Rs8,158mn in 3Q2020.
- However, sales growth is misleading as this year’s quarter include sales from PEL Marketing (Pvt.) Limited (previously wholly owned subsidiary and used to reflect in consolidated numbers), which has been merged with PAEL.
- Looking at previous year’s consolidated Net Sales, growth is estimated at 40% YoY.
- During the said period, volumetric sales have increased (+30% YoY in both Appliance and Power divisions) given pent-up demand from COVID-19.
- Gross Margins clocked in at 21.1% in 3Q2020, which is in line with our expectations.
- Effective tax rate clocked in at 16% in 3Q2020 vs. 39% in 3Q2019.
Pak Elektron Limited. Pak Elektron Limited is engaged in manufacturing and sale of electrical capital goods and domestic appliances. The Company operates through two segments: Power Division and Appliances Division. The Power Division is engaged in manufacturing and distribution of transformers, switchgears, energy meters, power transformers, construction of grid stations and electrification works. The Appliances Division is engaged in manufacturing, assembling and distribution of refrigerators, deep freezers, air conditioners, microwave ovens, washing machines and other home appliances. It offers services to power utilities, industries, individual customers, housing and commercial projects. Its engineering, procurement and construction (EPC) contracting division delivers custom designed and built high voltage and extra high voltage grid stations, electrification of housing projects and industrial parks. The Company's subsidiary is PEL Marketing (Private) 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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