EPCL is projected to post NPAT of PKR1.2bn (EPS: PKR1.41) for 1QCY23, down 76% QoQ and 73% YoY. International PVC-Ethylene spreads increased to US$424/ton (assuming 1 month lag), up 8% QoQ. Despite this, EPCL GMs are expected to decline by 0.6ppt QoQ to 17.6% in 1QCY23. This is due to lower demand from the construction sector, an overall increase in construction cost, and higher fuel & power costs amid the non-availability of natural gas during winters and an increase in power tariff. Elevated finance costs will not help.

The company is expected to pay an interim cash dividend of PKR1.0/sh in 1QCY23.

Courtesy- Intermarket Securities Limited.