· Indus Motor Company Limited posted an earning of PKR 15,802mn (EPS: PKR 201.04) during FY22, increasing by 23% YoY from PKR 12,829mn (EPS: 163.21) in FY21. However, the earnings during the last quarter had a massive blow, depicting a decline of 88% YoY and 90% QoQ. The massive fall in the profit was a result of lower gross margins and higher taxation due to the imposition of super tax. Along with the results, INDU declared a final cash dividend in 4QFY22 of PKR 3.25/share (4QFY21: PKR 36.5/share), taking the total dividend for FY22 to PKR 93.75/share (FY21: PKR 103.5/share).

Result Highlights

· Net sales of the company went up to PKR 275bn during FY22, up by 54% compared to PKR 179bn in FY21. Also, revenue during 4QFY22 increased by 50% YoY to PKR 72bn on the back of increased prices and higher volumetric demand (+23.3% YoY).

· Gross margins abruptly fell to 6.68% in FY22 compared to 9.3% in FY21, attributable to augmented inflation, massive uptick in imported raw material prices (especially steel prices) as well as PKR depreciation. Whereas gross margins dropped to 1.16% in 4QFY22 vis-à-vis 12.28% in 4QFY21, due to aforementioned reasons.

· Other income rose by 209% during 4QFY22 compared to SPLY led by higher interest rate earnings on a significantly higher quantum of advances from customers.

· INDU booked effective taxation at 88% in 4QFY22, showcasing a huge impact of super tax on the company.

Courtesy – AHL Research