$PABC Pakistan Aluminium Beverage Cans Limited (PABC): Hit hardest by border closure; Reiterate Sell – By JS Research
$PABC
Pakistan Aluminium Beverage Cans Limited
Rs. 106.15
+0.54%
- Despite several rounds of talks mediated by Qatar and Turkiye, as well as a recent brief dialogue in Saudi Arabia, there has been no progress toward resuming trade between Pakistan and Afghanistan. We are now incorporating a three-month border closure, which reduces our CY25E EPS estimate for Pakistan Aluminium Beverage Can (PABC) by 16% to Rs17.39 and lowers our target price to Rs124 (down 5%).
- In its recent quarterly report, PABC highlighted its plans to construct a 1.3bn can plant in Afghanistan, with an expected project outlay of US$110mn and a construction timeline of 1.5–2 years. As Afghanistan is a landlocked country, the new project will depend on raw material imports through transit trade with Pakistan.
- We are closely monitoring developments related to Pak–Afghan border issues and PABC’s investment plans, and will revisit our estimates for the company accordingly. In the meantime, we reiterate our Sell rating on PABC. Our sensitivity analysis suggests that every one-month export suspension implies a 5% negative impact on our CY26E EPS for the company.