Pakistan State Oil is expected to post 4QFY24f NPAT of PKR829mn (EPS: PKR1.77/sh), down substantially by 85% QoQ. The sequential drop in earnings is on the back of expected inventory loss of PKR3.7bn (PKR4.5/sh after tax) vs inventory gains booked in 3QFY24, thereby reducing PSO GMs to 2.6%. Net revenues are expected at PKR912bn, up 8% QoQ mainly due to improved volumetric sales, up 3% QoQ to 1.9mn MT, coupled with higher RLNG prices. The increase in volumes is on the back of rebound in HSD sales by 11% QoQ owing to seasonal impact, while MS volumes remained flat at 0.8mn MT. This brings FY24f NPAT to PKR14.2bn (EPS: PKR30.30), up 2.5x YoY.

We expect PSO to announce a cash dividend of PKR7.50/sh.

Courtesy – IMS Research