Indus Motor Company (INDU) announced its 3QFY22 financial result, where the company posted earnings of Rs5,118mn (EPS: Rs65.1) compared to Rs3,614mn (EPS: Rs46.0) in the same period last year. The result came in line with our expectations.

This takes 9MFY22 earnings to Rs15,292mn (EPS: Rs194.6), up 82% YoY.

Along with the result, the company announced an interim cash dividend of Rs26/share, taking the cumulative cash dividend to Rs90.5/share in 9MFY22.

Gross Margins of the company clocked in at 7.7% down by 1.5pts YoY in 3QFY22 owing to 1) higher raw material cost, (2) higher freight cost, and (3) PKR devaluation against dollar. Whereas on sequentially basis, margins remains almost flattish despite the increase in car prices.

Revenues of the company increased by 32% YoY to Rs68,223mn in 3QFY22. The significant increase in sales is driven by volumetric sales, up 12% YoY and increased car prices. Sequentially, revenues declined by 2% due to decrease in volumetric sales by 5% QoQ.

Other Income increased significantly by 122% YoY to clock in at Rs3,183mn in 3QFY22 due to higher interest rates and a strong order book.

Effective tax rate has clocked in at 27.6% in 3QFY22 as compared to 28.2% in 3QFY21.

Courtesy – AHCML Research