Honda Atlas Cars Reports Significant Profit Surge Amid Rising Sales

Karachi: Honda Atlas Cars Pakistan Limited (HCAR) has reported a substantial increase in profitability for the second quarter of the fiscal year MY26, driven by a notable rise in sales volumes. The company announced a profit after tax of PKR 742 million, compared to PKR 258 million in the same period last year, reflecting a significant improvement attributed to higher sales and favorable cost conditions.

The company’s revenue reached PKR 25.4 billion for the quarter, marking a 53% increase from the previous year. The uptick in sales volumes, with 4,880 units sold compared to 3,280 units in the same quarter last year, was a major factor in this revenue growth.

Gross margins saw a slight improvement, rising to 7.6% from 7.4% in the previous year, benefiting from a 3.4% decrease in CRC/HRC prices. However, the implementation of a New Energy Vehicle (NEV) adoption levy partially offset these gains.

Administrative and distribution expenses increased by 47% year-over-year, amounting to PKR 911 million. This rise is largely attributed to heightened advertising and promotional activities for the new HRV variants launched during the period.

Other income witnessed a significant increase, amounting to PKR 495 million, a 5.8-fold increase compared to the previous year. This surge is primarily due to a 60% increase in cash and cash equivalents, which stood at PKR 1.5 billion as of September 2025.

Financial charges rose by 63% year-over-year to PKR 315 million, possibly due to the discounting of long-term trade debts. The company is expected to provide further details on this matter.

AKD Securities Limited has issued a ‘BUY’ recommendation for HCAR shares, with a target price of PKR 451 per share by June 2026. This optimistic stance is supported by the company’s improving gross margins and increasing sales volumes.