Nishat Power Limited (NPL) announced its 2QFY22 financial result today where the company posted a profit after tax (PAT) of PKR 745mn (EPS: PKR 2.10), up by 37% YoY compared to PKR 544mn (EPS: PKR 1.54) during the same period last year. This takes 1HFY22 profitability to PKR 1,660mn (EPS: PKR 4.69) up by 12% YoY. The company announced a cash dividend of PKR 2.00/share along with the result.

Result Highlights

· During 2QFY22, net sales witnessed an increase of 221% YoY to PKR 4,142mn due to i) 884% YoY higher dispatches, and ii) 75% YoY higher FO prices. Sales during 1HFY22 also increased by 83% YoY due to same reasons mentioned above.

· Gross margins of the company during 2QFY22 dipped by 32pps YoY due to higher dispatches which were up by 884% YoY to 147 GWh.

· Finance cost has increased by 2% YoY | 10% QoQ during 2QFY22 due to higher interest rates.

Recommendation

· Currently we have BUY call on the scrip with a Dec’22 target price of PKR 22.7/share..

Courtesy – AHL Research