reports
- Team AKD Research
PSO 1QFY24 & PSMC 3QCY23 Result Previews, (AKD Daily Oct 19, 2023)
PSO – PAT to clock in at PkR18.3bn (EPS: PkR39.0) in 1QFY24: Pakistan State Oil (PSO) is expected to announce its 1QFY24 financial result on 20th October, where we expect the company to post PAT of PkR18.3bn (EPS: PkR39.0), higher by 14.0xYoY compared to LAT of PkR4.63bn (LPS: PkR9.85) in the quarter before. The said QoQ increase is majorly on the back of higher gross margins specifically on regulated products (MS/HSD) alongside significant inventory gains amid rising ex-refinery prices during t...
- Shahmir Malik
Honda Atlas: 1QMY24 Result Review: Strong other income leads to a prof...
HCAR reported NPAT of PKR 145mn (EPS: PKR 1.02) for 1QFY24, showing a decline of 78% YoY. The result is better than our estimated LPS of PKR1.26 and a significant improvement over LPS PKR: 5.77 in the previous quarter. Substantially higher other income of PKR903mn (on deployment of ST investments), helped offset operating level losses of PKR560mn. This, together with absence of hefty exchange losses – witnessed last quarter – led to the major deviation in today’s result. 1QMY24 key highlights...
- Shahmir Malik
Pakistan Autos: Rising gross margins to improve sector profitability
* We expect the Japanese Auto OEMs to post NPAT of PKR579mn for the quarter ended June 2023, where the major contribution should come from INDU, while the other two OEMS are expected to post a loss. * Higher car prices are expected to translate into better gross margins for the entire industry. Although prices had been raised earlier during the year, the full realization of gross margins is expected to occur this quarter. * Despite improving margins, low volumes and persistently hi...
- Shahmir Malik
Pakistan Autos - June 2023 - Modest recovery
Auto industry sales volumes displayed a moderate recovery, with a 10% MoM increase to reach 6,034 units. However, there has been a significant decline in sales by 79% YoY basis. The industry faced numerous challenges throughout the year, starting from raw material shortages due to import restrictions, PKR depreciation resulting in cost overruns, and demand destruction caused by rising interest rates and multi-decade high inflation. Consequently, vehicle sales in FY23 witnessed a substantial d...
- Shahmir Malik
Pakistan Autos - May 2023 - Improved PSMC sales lift industry volumes
Sales volumes in the auto industry have experienced a moderate recovery, with a MoM increase of 19% to 5,290 units. However, sales have decreased by a significant 77% YoY. The overall increase in production and sales volumes by PSMC has contributed to the sector's improvement on a MoM basis. Excluding PSMC, industry volumes have declined by 22% compared to the previous month. INDU: In the month of May'23, INDU volumes contracted by 12% MoM and 71% YoY, amounting to 1,718 units. All INDU’s var...
- Shahmir Malik
Honda Atlas: MY23 Review - Better gross margins overshadowed by Fx los...
HCAR has reported NLAT of PKR824mn (LPS: PKR5.77) in 4QMY23 as compared with NPAT of PKR197mn in SPLY. The loss came in higher than our expected LPS of PKR4.94, where the major deviation stemmed from higher-than-expected other expenses. This takes MY23 net profits to PKR260mn (EPS: PKR1.82), down 90% YoY. The company did not announce any dividend as per our expectation. 4QMY23 Result highlights include: * HCAR has reported revenues of PKR 22.3bn, showing a 27% YoY decline, as sales volumes d...
- Shahmir Malik
Pakistan Autos - Attractive valuations take care of the risks
* We maintain our Buy ratings on INDU (TP: PKR1,200/sh) and PSMC (PKR160/sh), but downgrade our stance to Neutral on HCAR (PKR120/sh). We look beyond interim Fx losses for PSMC and focus on its operational improvement. We also like INDU for its resilience and plans to introduce HEVs. HCAR is impeded by its relatively limited product offerings. * We think the worst of the macroeconomic shock is behind us, with auto OEMs already experiencing "default-like conditions." Demand and supply ma...
- IMS Research Team
Pakistan Suzuki: 1QCY23 Review - Amplified FX losses slash equity furt...
Pak Suzuki Motor Co. (PSMC) has posted a massive net loss of PKR12.9bn (LPS: PKR156.94) in 1QCY23, down from a loss of PKR3.8bn (LPS:46.55) in 4QCY22. The loss came in higher than our expected LPS of PKR122.47, where the major deviation stemmed from lower than expected gross margins and high finance costs. KEY RESULT HIGHLIGHTS FOR 1QCY23: * Revenue clocked in at PKR 21.8bn, down 54% YoY and 64% QoQ. This is higher than our expected topline of PKR20.9bn. The decline can primarily be attribut...
- Shahmir Malik
Pakistan Autos – Sector losses to extend on low volumes and PKR deprec...
IMS Autos Universe is anticipated to post NLAT of PKR8.6bn for the quarter ended March 2023, where the major contribution will come from PSMC which is expected to report an exchange loss of PKR10.1bn on its foreign payables. HCAR may also report losses for the quarter. Prolonged measures to curb non-essential imports have forced some local players to shut down their assembly lines. As a result, industry sales and production have further contracted by 46% and 47% QoQ basis. The timeline for ea...
- IMS Research Team
Pakistan Autos Sales: Volumes improved sequentially amid ease off in p...
Latest automobile sales numbers showed a positive MoM growth of 36%. Sales were down by 2% on a YoY basis. Production numbers maintained their positive momentum growing by 37% MoM to 18,391 units. This is an encouraging sign, especially considering the tough macro-environment the automakers are currently facing, with elevated interest rates, PKR volatility and import curtailment measures on CKD imports. While the numbers are encouraging persistent deterioration in Pakistan’s economic indicato...
- IMS Research Team
Honda Atlas: 2Q23 Result: Lower revenues and elevated other expenses l...
HCAR has reported NLAT of PKR385mn (LPS: PKR2.70) for 2QMY23. This is a weak result from HCAR, where the deviation from our projected EPS of PKR2.08 is primarily due to lower-than-expected revenues and higher-than-expected other expenses. 2QMY23 key highlights: * Net revenue clocked in at c.PKR20bn, lower than IMS expectation of c.PKR22bn. The topline was down by 36% QoQ and 25% YoY, owing to c.40% QoQ lower volumes to c.5,600 units. * Gross margin stands at 3.4%, much lower than our ex...
HCAR_2QMY23 Result Review, (AKD Off the Analyst's Desk Nov 16, 2022)
Honda Atlas Cars Limited (HCAR) announced it 2QMY23 result today where it posted LAT of PkR385mn (LPS: PkR2.7) compared to profit of PkR658mn (EPS: PkR4.6) in the first quarter. This brings cumulative earnings for 1HMY23 to PkR273mn (EPS: PkR1.9). The performance in the quarter is well below industry expectations due to a taxation charge of PkR544mn, culminating to an ETR of 342% for the quarter. Revenue for the quarter has decreased by 35%QoQ to reach PkR19.5bn, while also down by 25%YoY....
HCAR_2QMY23 Preview, (AKD Daily, Nov 16, 2022)
HCAR: 2QMY23 Preview We expect Honda Atlas Cars Limited (HCAR) to post NPAT of PkR68mn (EPS: PkR0.5) in 2QMY23, taking cumulative earnings in 1HMY23 to PkR726mn (EPS: PkR13.1). Revenue for the quarter is expected to decline by 23%YoY/34%QoQ, clocking in at PkR20.0bn. We expect margins for HCAR to contract to 4.1% compared to 6.3% in the last quarter.
- IMS Research Team
Oct’22 - Partial resumption of production has led to improved sales nu...
Latest automobile sales figures show some relief post the resumption in production; sales are down by 36% YoY, the MoM numbers were up 22% to 13,369 units. This is a similar number to the post pandemic lockdown in Sep’20. Despite the prevailing auto-parts import curtailment measures on CKD units, plant production resumption in Oct’22 has led to the improved production of 13,021 units (down 36% YoY but up 39% MoM). That said, elevated interest rates, PKR volatility and hampered production will...
- Abdul Ghani Mianoor
Pakistan Suzuki: 3QCY22 Review - Hefty finance costs drag PSMC into lo...
Pak Suzuki Motor Co. (PSMC) has posted a Net Loss of c.PKR2.5bn (LPS: PKR30.25) in 3QCY22, from a NPAT of c.PKR1.0bn (EPS: PKR12.07) in 3QCY21 and c.PKR0.4bn (EPS: PKR5.38) 2QCY22. This takes 9MCY22 net loss to c.PKR2.5bn (LPS: PKR30.46). The 3Q result is significantly worse than our expected EPS of PKR3.18, owing to a sharp rise in finance costs. KEY RESULT HIGHLIGHTS: * Net revenue of PKR29.8bn (in line with expectations), down a sharp 41% YoY, majorly owing to a 24% YoY contraction in vol...
- Abdul Ghani Mianoor
Pakistan Autos: Difficult year ahead; prospects likely to improve beyo...
We reduce our earnings forecast and Target Prices by an average of 7% and 9%, respectively, on account of persistent supply chain constraints and an uncertain near-term macroeconomic environment. Elevated car prices in a high interest rate environment have led to weak sales during FY23td, PKR volatility may continue to dampen industry margins in 1HFY23, before respite comes moving into FY24f. We trim our 2023-26f margins for the OEMs by an average 1ppt, and sales volume estimates by 5ppt on a...
- Abdul Ghani Mianoor
Sep’22 Result Preview - Administrative measures will push massive earn...
* For Sep’22 results, we expect IMS Auto Universe combined net profit to plunge a sharp 73% YoY to PKR2.0bn, largely owing to administrative measures imposed by the SBP to curb CKD kit imports. Lower gross margins will also contribute to this decline. * The Sep’22 quarter was marred by plant shutdowns, which resulted in a 53% decline in sales compared to last year (sales down 52% QoQ). Although commodity prices continued to slump, implying positives for input pricing, lower volumes are ...
- Abdul Ghani Mianoor
Pakistan Auto Sales: Admin measures continue to curtail demand in Augu...
Latest automobile sales print indicates another sharp slump in demand of 46% YoY (down a further 2% MoM) to c.11,650 units, continuing its trajectory from the previous month that is similar to pandemic lockdown in Jun’20, largely owed to production constraints. The ongoing auto-parts import curtailment measures taken by the SBP, coupled with recent floods impacting supply has led to the decline in production during Aug’22. Also, high interest rates, PKR volatility, potential further price hik...
- Abdul Ghani Mianoor
Pakistan Suzuki: 2QCY22 review – Results beat our expectations on bett...
Pak Suzuki Motor Co. (PSMC) has posted a NPAT of c.PKR0.4bn (EPS: PKR5.38), up c.5% YoY and from a LPS of PKR5.59 last quarter. This takes 1HCY22 net loss to PKR17mn (LPS: PKR0.21). The 2Q result significantly beats our projected LPS of PKR7.12, owed to higher-than-expected gross margin and significant other income. KEY RESULT HIGHLIGHTS: * Net revenue reached an all-time high of c.PKR65bn (broadly in line with expectations), owing to record volumetric sales of 40,860 units. The surge in sa...
- Abdul Ghani Mianoor
Honda Atlas: 1QMY23 Review - Strong beat from higher margin
HCAR has reported a NPAT of PKR658mn (EPS: PKR4.61) for 1QMY23, up c.3x QoQ. This is strong result from HCAR, where the deviation from our projected EPS of PKR0.20 is primarily due to higher-than-expected gross margin and lower taxation. 1QMY23 KEY HIGHLIGHTS: * Net revenue reached PKR30bn (in line with estimates), up c.40% YoY owing to c.25% higher volumes to c.9,400 and multiple price hikes from Nov’21. * Gross margin stands at 6.3%, higher than expectations, likely due to i) new Civi...
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