Indus Motor Company Limited (INDU) is expected to announce financial result for 1QFY23 on 26th Oct’22. The company is projected to post a net profit of PKR 3.7bn (EPS: PKR 47.5), down by 31% YoY as gross margins are expected to decline substantially by (-990 bps YoY) due to higher cost of production on the back of rupee devaluation and increased commodity prices. Additionally, a downfall in gross margins is also expected on a sequential basis (-30bps QoQ) as the price hikes has led sales volume to shrink; further, the policy by SBP to curtail imports has resulted in lower production and sales. Company is expected to post topline of PKR 47,279mn (-28% YoY) on the back of lower volumetric sales (-52%) with major contributions coming from Yaris (-61% YoY), followed by Hilux (-54% YoY). Other income is expected to grow by 207% YoY, it is mainly driven by higher interest income on increased advances from customers. In addition to the result, the company is expected to announce an interim cash dividend of PKR 24.00/share (PKR 34.50/share in 1QFY22).

Courtesy – AHL Research