Cheratc Cement Profit Soars 116% on Margin Expansion

Islamabad: Cherat Cement Company Ltd. (CHCC) posted a remarkable 116% year-on-year surge in its fourth-quarter profit for fiscal year 2025, reaching PkR1.8 billion (EPS: PkR9.51). This impressive performance surpassed the PkR854 million (EPS: PkR4.40) recorded in the same period last year and aligned with analyst projections. The corporation also declared a final cash dividend of PkR4.0 per share, bringing the total annual payout to PkR5.5 per share.

Despite a marginal 2% yearly increase in sales to PkR9.7 billion, impacted by a slight dip in sales volume, CHCC’s gross margins expanded significantly from 28.1% to 32.6%. This improvement was primarily attributed to reduced coal costs and firmer retention pricing. The firm apparently boosted its electricity consumption from the national grid due to escalating gas tariffs for captive power generation and newly implemented levies.

While operating expenditures saw a 16% yearly rise, largely due to increased administrative costs, other income showed substantial growth of 174% to PkR450 million, fueled by a 4.2-fold jump in short-term investments. Finance costs plummeted by 66% to PkR86 million due to lower debt and declining borrowing rates. The company’s effective tax rate stood at 38.7%, considerably lower than the 60.6% recorded in the same period last year, due to the super tax levied in the FY24 federal budget.

For the full fiscal year 2025, CHCC’s earnings escalated by 58% to PkR8.7 billion (EPS: PkR44.68) compared to PkR5.5 billion (EPS: PkR28.31) in the previous year. Analysts maintain a ‘BUY’ recommendation for CHCC with a December 2025 target price of PkR379 per share, citing the company’s anticipated earnings growth, propelled by lower royalty charges in the KPK region and elevated cement prices.