We estimate Indus Motor to post PAT of PKR4,234mn (EPS: PKR53.59) compared to PKR PKR3,632mn (EPS: PKR 45.98) in the corresponding period last year, depicting the massive increase of 16%YoY owing to an increase in sales volume by 12%YoY, the previous year sales volume was depressed due to covid-19 pandemic.

The company also witnessed a massive 65% growth in other income due to increased advances from customers and a higher interest rate.

The rise in sales volume and price escalation and lower auto financing rates supported the bottom line. However, increase in raw material prices mainly steel, rubber, plastic, higher freight cost, and PKR depreciation against USD remain the major challenges for the company which is expected to keep the automotive industry cost at the higher side and hit profitability. The cash dividend of PKR25/share is also likely in 3QFY22.

Courtesy – Spectrum Research