Hinopak Motors Reports Steady Sales Amid Economic Challenges

Karachi: In the April-June quarter of 2024, Hinopak Motors Limited maintained a steady pace in the sale of trucks and buses, mirroring figures from the same period last year, with 76 units sold. According to information available from the Pakistan Stock Exchange (PSX), this stability comes amid a broader surge in the commercial vehicle market, which saw a 64% increase in total sales across all brands, reaching 816 units.

The company’s sales revenue slightly increased to Rs. 1.92 billion from Rs. 1.87 billion in the corresponding quarter of the previous year. This revenue boost contributed to a gross profit of Rs. 225 million, more than double the Rs. 98 million recorded last year. However, Hinopak’s financial health faced challenges, as finance costs soared to Rs. 143 million, primarily due to increased mark-up on short-term borrowings, which rose from Rs. 31 million to Rs. 141 million.

Despite these gains in revenue and sales volume, the company reported a loss after tax of Rs. 120 million, slightly worse than the loss of Rs. 106 million in the same period last year. This resulted in a loss per share of Rs. 4.83, compared to Rs. 4.26 in the prior year’s quarter.

Looking forward, Hinopak’s outlook is cautiously optimistic, bolstered by a new staff-level agreement between Pakistan and the International Monetary Fund (IMF) for an extended financing facility. This agreement is expected to enhance funding prospects to meet the country’s external financing needs and stimulate economic growth. However, the company anticipates that the road to economic stabilization will be challenging due to ongoing political instability and escalating inflation, particularly with recent hikes in power tariffs.

The commercial vehicle industry’s growth is tightly linked to macroeconomic stability, government spending on development projects, favorable foreign exchange and interest rates, and increased economic activities within Pakistan. Hinopak’s management remains dedicated to adapting to market dynamics to ensure sustainable growth and value creation for stakeholders.

In conclusion, Hinopak extends its gratitude to its parent companies, customers, and the Hinopak team—including staff, vendors, dealers, and business partners—for their unwavering support and efforts during these challenging times.