The financial result of Indus Motor Company Limited (INDU) is scheduled to be announced on October 25th, 2021.

We expect profitability during 1QFY22 to increase significantly by 121% YoY while down by 8% QoQ to PKR 4,080mn (EPS: PKR 51.91) against PKR 1,845mn (EPS: PKR 23.48) during 1QFY21 and PKR 4,413mn (EPS: PKR 56.15) last quarter.

Topline is expected to increase by 87% YoY to PKR 64bn attributable to change in sales mix and volumetric growth of 59% YoY to 18,646 units (Yaris 7,240 units, Corolla 6,596 units, Fortuner 1,601 units, Hilux 3,209 units) vs. 11,715 units (Yaris 6,009 units, Corolla 3,614 units, Fortuner 390 units, Hilux 938 units) in 1QFY21.

We project gross margins of the company to increase by 212bps YoY to 8.81% amid change in sales mix. However, on quarterly basis, gross margin is expected to drop by 347bps due to depreciation of PKR, higher steel prices and surge in freight cost.

Along with this, we expect the company to announce a dividend of PKR 35.00/share.

Courtesy – AHL Research