Automobile Assemblers: Earnings Preview: Profitability to improve on QoQ basis - By Insight Research
Jul 29 2025
Insight Securities
- We preview quarterly results of INDU, SAZEW, MTL and AGTL for Jun’25, wherein we expect ISL auto universe to post revenue of PKR119.4bn, up by 10%/5% YoY/QoQ, led by higher volumetric sales. In Jun’25, sector is expected to post PAT of PKR13.1bn, up by ~18% YoY. Whereas on QoQ basis, profitability is anticipated to decline by ~8% QoQ. Company specific, we expect INDU/SAZEW/MTL/AGTL to post an EPS of PKR94.6/71.9/5.5/3.1 in Jun’25, respectively. Furthermore, we expect INDU/SAZEW/MTL to announce DPS of ~PKR56.0/12.0/11.0.
- To highlight, passenger cars sales increased by 34%/27% YoY/ QoQ to clock in at 36.8k units in 4QFY25. The increase is attributable to improved economic activity, lower interest rate and low base effect. Similarly, jeeps & pickups sales witnessed an increase of ~43% YoY. While same is down by ~8% QoQ. Conversely, tractor companies sold 5.9k units in Jun’25, down by ~42% YoY, primarily due to weak agronomics.
- We estimate INDU to post PAT of PKR7.4bn (EPS: PKR94.6) in 4QFY25 vs. PKR5.7bn (EPS: PKR72.1) in SPLY, up by 31%/13% YoY/ QoQ. Company’s topline is expected to go up by 37%/22% YoY/QoQ to clock in at PKR74.3bn in 4QFY25, owing to increase in volumetric sales which grew by ~67%/30% YoY/QoQ. Gross margin of the company is expected to clock in at 15.2% in 4QFY25, attributable to lower raw material prices and stable exchange rate. Other income is expected to go down by 20% YoY to clock in at PKR3.4bn, primarily attributable to lower interest rates. While same is anticipated to go up by ~22% QoQ due to higher cash & cash equivalent. Along with the result, we expect company to announce dividend of PKR56.0/sh in 4QFY25.