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Karachi, April 16, 2013 (PPI-OT): INDU; Earnings expected to plunge 46% YoY in 9MFY13 Indus Motor Company Limited (INDU) is scheduled to announce its 9MFY13 financial results on April 18, 2013.
According to Arif Habib Limited expect s the company to post profit after tax of PKR 1,564mn (EPS: PKR 19.89), down by 46% YoY as compared to PKR 2,894mn (EPS: PKR 36.82) recorded in the same period last year. On quarterly basis the company is expected to post PAT of PKR 586mn a jump of massive 104% QoQ. The quarterly growth in the profitability is mainly attributable to 1) jump in the volumetric sales by 74% QoQ to 11,130 units during the quarter, 2) launch of the new variant Toyota ‘Fortuner’ in Feb-13, as INDU managed to sell 231 units of Toyota Fortuner in 3QFY13 3) improved gross margins on account of recovered volumetric sales, which reduces fixed cost per unit and 4) Other income expected to plunge by substantial 37% QoQ due to lower cash balances and income on cash deposit. At level of PKR 301.4/share, the stock offers upside potential of 6.8% from Arif Habib Limited Dec-13 price target of PKR 321.8/share. Thus, Arif Habib Limited recommends Hold on the scrip.
| Financial Highlights | ||||||
| PKR mn | 3QFY13E | 2QFY12A | QoQ | 9MFY13E | 9MFY12A | YoY |
| Net sales |
18,289 |
10,805 |
69% |
42,568 |
53,934 |
-21% |
| Gross profit |
1,195 |
595 |
101% |
2,946 |
4,261 |
-31% |
| Sales and admin expenses |
342 |
336 |
2% |
1,026 |
929 |
10% |
| Operating profit |
853 |
259 |
229% |
1,920 |
3,331 |
-42% |
| Other income |
121 |
191 |
-37% |
614 |
1,343 |
-54% |
| Finance cost |
10 |
9 |
4% |
23 |
50 |
-55% |
| Profit after tax |
586 |
287 |
104% |
1,564 |
2,894 |
-46% |
| EPS (PKR) |
7.45 |
3.65 |
19.89 |
36.82 |
||
| Dividend (PKR) |
– |
– |
6.00 |
8.00 |
||
Source: Company Accounts and Arif Habib Research
DGKC; Earnings to post a 2x YoY jump in 9MFY13
Arif Habib Limited previews the financial result for D.G. Khan Cement Company Limited (DGKC). Arif Habib Limited expects the company to post a flattish QoQ earnings growth to PKR 3.4/share (PKR 3.37 in 2QFY13) as 26% higher selling expenses and a 25% QoQ drop in other income is expected to nullify the 8% QoQ jump in gross profit. On cumulative 9M basis, the company is expected to post a massive 2x YoY earnings growth to PKR 10.05/share compared to PKR 4.73/share in the corresponding period last year. An 11% YoY jump in average retention prices and cooling off coal price are anticipated to yield a 30% YoY growth in gross profit. In addition, a 22% YoY jump in other income coupled with a massive 35% drop in financial charges would be pivotal for the company to post 2x earnings growth.
| Financial Highlights | ||||||
| PKR mn | 3QFY13E | 2QFY13A | QoQ | 9MFY13E | 9MFY12A | YoY |
| Net Sales |
6,377 |
5,952 |
7% |
18,203 |
16,704 |
9% |
| Gross Profit |
2,555 |
2,404 |
6% |
7,171 |
5,512 |
30% |
| Selling Expenses |
396 |
313 |
26% |
1,283 |
1,823 |
-30% |
| Other Income |
314 |
417 |
-25% |
1,086 |
890 |
22% |
| Finance Cost |
268 |
275 |
-2% |
846 |
1,303 |
-35% |
| Profit after tax |
1,489 |
1,474 |
1% |
4,402 |
2,072 |
113% |
| EPS (PKR) |
3.40 |
3.37 |
10.05 |
4.73 |
113% |
|
Source: Company Accounts and Arif Habib Research