Indus Motor reported net sales of PKR 74,169 million in 3QFY26, marking a 22% YoY and 29% QoQ increase. This growth was largely driven by a 40% YoY rise in volumetric sales, supported by seasonal factors and improved supply chain efficiency, according to a report from AHCML Research.

– Sales of the Corolla, Yaris, and Corolla Cross surged by 63% YoY, while Fortuner and Hilux sales fell by 11% YoY, slightly shifting the sales mix towards lower-margin vehicles.

– Gross profit was PKR 10,377 million, up 1% YoY, but gross margins declined to 14.0% from 17% YoY. However, margins improved from 13.1% QoQ.

– Other income increased by 23% YoY to PKR 3,427 million, though it fell 36% QoQ due to a warranty obligation reversal. The company reported a PAT of PKR 6,532 million (EPS: PKR 83.1), down 1% YoY but up 9% QoQ. For 9MFY26, PAT totalled PKR 19,233 million (EPS: PKR 245), a 16% YoY increase.

A cash dividend of PKR 50 per share for 3QFY26 was announced, resulting in a total dividend of PKR 147 for 9MFY26, up 17% YoY.

– With a target price of PKR 2,450 per share for December 2026, Indus Motor offers a 21% upside and trades at an attractive FY26 P/E of 6.2x. Its strong cash position and focus on localisation and innovation enhance its growth potential. We recommend a “BUY” on the stock.