reports
- Team AKD Research
MUGHAL_4QFY23 Result Review-Surprise dividend announced, (AKD Off the ...
Mughal Iron & Steel Industries Limited announced its 4QFY23 results, where the company posted an earnings of PkR834mn (EPS: PkR2.48), marking a 36% decrease compared to PkR1.31bn (EPS: PkR3.89) last quarter. This decline is majorly attributable to an increase in finance cost compared to last quarter, clocking in at PkR1.5bn (up by 49%QoQ). The company also announced a cash dividend of PKR3.2/sh whereas the dividend for FY22 was PkR3/sh. Topline for the quarter increased by 10%QoQ to PkR18....
- IMS Research Team
Mughal Iron & Steel Industries: 3QFY23 Result Review - Strong gross ma...
MUGHAL has posted 3QFY23 NPAT of PKR1.3bn (EPS: PKR3.89), up 56% YoY and 10% QoQ. The result came in well above our projected NPAT of PKR0.4bn (EPS: PKR1.32), due to: higher-than-expected gross margins. This result takes 9MFY23 NPAT to PKR2.6bn (EPS: PKR7.89), down 39% YoY. KEY TAKEAWAYS FROM 3QFY23 RESULT INCLUDE: * Revenue clocked in at PKR17.2bn, up 14% YoY and 25% QoQ – in line with our expectations. The QoQ increase is despite the decline in sales volumes, where multiple price hikes and...
- IMS Research Team
Pakistan Steel – 3QFY23 Result Previews
LOWER DEMAND AND INVENTORY LOSSES TO DENT PROFITABILITY * IMS Steel Universe is expected to post a cumulative NPAT of c.PKR1.1bn in 3QFY23, compared to losses of PKR0.3bn in the last quarter. Higher steel product prices and inventory gains amid rupee devaluation are expected to uplift quarterly earnings. * Multiple price hikes of rebar and CRC are likely to increase sector gross margins by 6ppt to 12%. However, depressed demand, import restrictions and rising energy cost may pose a ris...
MUGHAL_FY22 Analyst Briefing Takeaways, (AKD Daily, Nov 30, 2022)
MUGHAL: FY22 Analyst Briefing Takeaways To recall, company posted consolidated PAT of PkR5.4bn (EPS: PkR16.12) for FY22 against PAT of PkR3.4bn (EPS: PkR10.22) SPLY, up 58% YoY. The main markets of the company are domestic housing sector both in urban (rebar) and rural areas (girder), and the international market for copper ingots, which is majorly exported to China. Company has been continuously involved in efficient supply chain management through various initiatives e.g. strong retail net...
- Abdul Ghani Mianoor
Mughal Iron & Steel Industries: 1QFY23 Review - Earnings beat on GMs a...
MUGHAL posted a profit of PKR872mn (EPS: PKR2.60) for 1QFY23, down 48% YoY and 5% QoQ. Profits are above our expected EPS of PKR1.43, where the major deviation stemmed from higher-than-expected gross margins and other income. Despite softer demand and surging interest rate, the company was able to produce a decent result. Key Observations: * Revenue has clocked in at PKR14.1bn, flat QoQ and down 26% YoY, lower than our expected revenue of PKR15bn. Lower-than-expected volumes majorly led to t...
- Ali Aziz Soorty
Mughal Iron & Steel Industries: 4QFY22 Review: Tax credit and low inte...
MUGHAL posted a profit of PKR1.0bn (EPS: PKR3.10) for 4QFY22, up from PKR0.8bn (EPS: PKR2.50) last quarter. This has translated FY22 NPAT to PKR5.4bn (EPS: PKR16.12), c.13% up from SPLY. The announcement is against our earnings expectation of PKR2.25/sh, where the major deviation stemmed from lower than expected tax rate (28.7%) and finance cost. Despite a dampened demand outlook and surging interest rate the company was able to produce an impressive result, albeit opting out of a final cash ...
Pakistan Metal_Global metal prices are in place, (AKD Daily, Jun 16, 2...
AKD Daily Pakistan Metal: Global metal prices are in place International aluminum/zinc/lead/nickel prices have started mean reversion, contracting 35/19/17/48% from their peak in Mar-Apr’22, depicting signs of metal commodities upcycle losing stream. Moreover, scrap has also accompanied these industrial metals where it has lost 45% from its peak of US$700/ton to US$385/ton which bodes well for local long steel manufacturers (MUGHAL, ASTL, AGHA, and ITTEFAQ). On the local front, rebar pric...
Pakistan Steel_Scrap down 22%MoM in May’22, amid cheaper Russian impor...
Scrap down 22%MoM in May’22, amid cheaper Russian importsInternational scrap prices have contracted 22%MoM in May’22, currently hoveringaround US$487/ton compared to FYTD/CYTD avg. of US$508/553/ton. Following periodsof high volatility, scrap prices have declined rapidly amid abundant cheap Russian importsavailable at European ports resulting in dampening prices. India has raised duties on export of major steel products including iron ore to curb downsoaring steel production costs to curtail en...
- Ali Aziz Soorty
Mughal Iron & Steel Industries: 3QFY22 review – weak ferrous margins l...
MUGHAL has posted a NPAT of PKR0.8bn (EPS: PKR2.50) for 3QFY22, down 24% yoy and 54% qoq. This takes 9MFY22 NPAT to PKR4.4bn (EPS: PKR13.02), up 74% yoy. The 3Q result has come in substantially lower than our projected EPS of PKR4.31, where the major variance has emanated from (i) depressed local sales volume, and (ii) lower-than-expected gross margins. KEY TAKEAWAYS FROM 3QFY22 RESULT: * Revenues have clocked in at PKR15.1bn, up c.46% yoy but down c.16% qoq. It is lower than our expectation...
MUGHAL & NML_9MFY22E Result Previews,
AKD Daily MUGHAL & NML: 9MFY22E Result Previews MUGHAL - earnings to clock in at 4.95/sh: MUGHAL is slated to announce its 3QFY22 result (28th Apr'22), where we expect the company to register NPAT of PkR1.7bn (EPS: PkR4.95) vs PkR1.1bn (EPS: PkR3.31) in 3QFY21. This will take 9MFY22 earnings to PkR5.1bn (EPS: PkR15.48) against PkR2.5bn (EPS: PkR7.47) in 9MFY21. The earnings are primarily expected to emanate from 94.4%YoY/11.7%QoQ growth in topline largely on account of higher rebar (+7%QoQ) an...
- Ali Aziz Soorty
Pakistan Steel: 3Q22 preview – Profitability to decelerate amid slower...
* IMS Steel Universe to post cumulative NPAT of c.PKR3.2bn in 3QFY22, down c.14% qoq, this is due to slower volumes amid elevated construction cost and seasonal slowdown. * We expect that gross margins of long steel companies will hold strong due to (i) sequential increase in rebar prices, and (ii) slight let off in international scrap prices. However, flat steel margins are likely to decline qoq due to contraction in CRC-HRC spreads internationally. * Despite the series of price h...
- IMS Research Team
Pakistan: Long Steel – Stable earnings growth beyond FY22f
* We reiterate our Buy rating on ASTL and MUGHAL with new June 2023 TPs of PKR44/sh and PKR131/sh, respectively. Broadly, our estimate revisions are driven by expectation of slower demand, along with higher prices of global scrap and domestic rebar. * MUGHAL is our top pick among the listed long steel producers, where its diversification in non-ferrous segment sets it apart. The company will enhance this attribute by expanding its Copper processing capacity and will also add a new capac...
- Abdul Ghani Mianoor
Mughal Iron & Steel Industries: 2QFY22 review: Surprise payout
MUGHAL has posted a NPAT of PKR1.8bn (EPS: PKR5.49) for 2QFY22, up a sharp c.75% yoy and c.10% qoq. The 2Q result has come in slightly lower than our projected EPS of PKR5.89, where the variance broadly has emanated from lower-than-expected gross margins. MUGHAL announced an interim dividend of PKR3.0/sh, against our expectation of no dividends (we based it on earlier announcement of non-ferrous expansion plans). KEY TAKEAWAYS FROM 2QFY22 RESULTS: * Revenue has clocked in at PKR18.1bn, up a ...
- Abdul Ghani Mianoor
Pakistan Steel: Expect greater profits for Long Steels, but lower for ...
We expect our Steel Universe to post cumulative 2QFY22 NPAT of c.PKR5.0bn, up a sharp c.40% yoy amid a similar rise in revenues due to multiple price hikes during the quarter, in both long and flat steel. In our view, gross margins of long steel companies in our coverage should rise yoy due to record high rebar prices (stronger pricing power amid healthy demand). Flat steel margins, however, are likely to decline yoy due to moderating inventory gains. Taking cue from a series of price hikes i...
- Abdul Ghani Mianoor
Mughal Iron & Steel Industries: Diversifying further in the non-ferrou...
Mughal Iron & Steel Industries Ltd (MUGHAL PA) recently announced plans on further diversifying operations in the Non-ferrous segment, including enhancement of Copper capacity, while also venturing into the Aluminum segment (hinted at by the management in a recent Analyst Briefing). PROJECT CAN BE VALUE ACCRETIVE, BUT WILL NEED HIGH UTILIZATION LEVELS MUGHAL’s venture into the Non-ferrous segment (Copper ingots) has proved very profitable since inception (FY20).The segment is presently contri...
- Team AKD Research
Pakistan Strategy - 61k or bust! (AKD Detailed Report, (Dec 28, 2021)
Pakistan Market Strategy CY22 (Detailed Report) 61k or Bust! Boom or Bust: Afridi is on the pitch. Anything can happen. A six and the match is won; a wicket and it’s all over. An apt metaphor for Pakistan market. Afridi is the government (and I’m not even making the Pathan connection here). Pass the mini budget, get the IMF on board, and despite a few difficulties and off days (dot balls in cricketing analogy), the match is won and you’re looking forward to KSE-100 at 61k+ for CY22. Unab...
- Team AKD Research
Pakistan Metals_Copper and Scrap remain strong amid decline in other i...
AKD Daily Pakistan Metals: Copper and Scrap remain strong amid decline in other industrial metals CRC-HRC spreads have started to shrink, currently trading at US$100/ton as compared to a high of US$142/ton and an avg. of US$128/ton in Nov’21. Major decline is attributable to 15% reduction in CRC prices to US$857/ton vs an avg. of US$893/ton in Nov’21 owing to policy tightening in China to limit exports. International aluminum/zinc/lead prices have started to retreat, contracting 17.3/14/10...
- Team AKD Research
Pakistan Steel_MUGHAL Relishing multiple growth fronts, (AKD Daily, No...
AKD Daily Pakistan Steel: MUGHAL Relishing multiple growth fronts We update our investment case on Mughal Steel & Iron Industries (MUGHAL) post corporate briefing session and release of 1QFY22 accounts where we incorporate MUGHAL’s higher than expected sales volume, increasing our FY22 sales volume assumption to 350k tons from 330k tons earlier for long-rolled segment while for copper segment, we have increased our assumption to 8k tons from 7.5k tons earlier (EPS for FY22F increased to PkR1...
- Team AKD Research
MUGHAL_FY21 Analyst Briefing Takeaways ,(AKD, Off the Analyst's Desk, ...
AKD, Off the Analyst's Desk MUGHAL: FY21 Analyst Briefing Takeaways AKD Securities Ltd. organized Analyst Briefing of Mughal Iron & Steel Industries Limited (MUGHAL) to discuss FY21 result and future outlook of the company. To highlight, the company reported outstanding NPAT of PkR1.7bn (EPS: PkR5.03) in 1QFY22 vs. NPAT of PkR0.3bn (EPS: PkR1.05) in the same period last year. In FY21, earnings stood at PkR3.4bn (EPS: PkR10.2) in FY21 vs. NPAT of PkR0.6bn (EPS: PkR1.8) in the same period last y...
- Team AKD Research
Pakistan Steel_Upbeat demand keeping scrap and copper prices robust, (...
AKD Daily Pakistan Steel: Upbeat demand keeping scrap and copper prices robust International scrap/copper prices have increased by 11.0%/11.1% since Oct’21 to currently hover around US$488/9,932/ton compared to FYTD avg. of US$473/9,485/ton amid power shortages and supply concerns which caused smelters to go offline from Chile to China. Impressive Chinese export growth in Oct’21(+27.1%YoY) to US$300.2bn has counterbalanced some of the pressure mounting on Chinese local manufacturers from em...
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