Pak Suzuki Motor Co. (PSMC): 2Q2020 loss at Rs18.49/share (loss higher-than-expectations)
- Pak Suzuki Motor (PSMC) reported its 2Q2020 result, where the company booked a loss of Rs18.49/share compared to a loss of Rs6.62/share in 2Q2019.
- PSMC has cumulatively reported LPS of Rs29.92 in 1H2020.
- The loss during the quarter came in higher than industry expectations mainly due to higher than expected depletion in gross margin as company reported a gross loss of Rs612mn in 2Q2020.
- The company’s revenues declined by 58% YoY in 1H2020, mainly attributable to 68% YoY fall in unit sales. The unit sales are down by 45% QoQ to 7,512 units in 2Q2020.
- The demand for new cars remained depressed throughout 1H2020 amidst high car prices and negative impact of COIVD-19 on consumer buying.
- PSMC has recorded finance cost of Rs886mn, which has been another major drag to the profitability of the company.
- However finance cost is down by 16% QoQ on back of lower interest rates.
- The company has booked a net tax benefit of Rs551mn in 2Q2020.
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.
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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