AsiaNet-Pakistan Premier Editorial Content and Press Release Distribution Service
Lahore: Mughal Iron and Steel Industries (MUGHAL) held an analyst briefing to discuss its business performance and future outlook, revealing mixed results for the fiscal year 2025. While the company saw an increase in rebars and girders sales, it also experienced a decline in overall sales due to reduced non-ferrous operations.
The briefing highlighted that rebar sales increased from 160,000 to 192,000 metric tons, and girder sales rose from 80,000 to 120,000 metric tons in FY25. The ferrous segment contributed 82% to the overall revenue, a significant increase from 6% in FY24. In contrast, the non-ferrous segment’s contribution decreased to 18% from 32% in the previous year.
MUGHAL’s overall sales declined by 2% in FY25, attributed to the reduced non-ferrous operations. The company noted that sale prices are influenced by factors such as international scrap prices, energy costs, and exchange rate parity. Despite a slight fall in prices of rebar, girder, and billets compared to FY24, MUGHAL’s diversified product portfolio helped mitigate price volatility.
The increase in long-term loans was driven by a Rs2.5 billion facility to Mughal Energy Limited. Changes in working capital were mainly due to lower inventories, higher trade debts, and deferred letters of credit. The company expects healthy growth and higher sales in the coming quarters, driven by post-flood reconstruction activities.
MUGHAL has temporarily halted its copper business due to lower profitability compared to its steel operations. The company plans to resume copper operations once market conditions stabilize, allowing it to reposition itself with more value-added products.
Looking ahead, MUGHAL anticipates a positive impact in FY27, with an expected additional 500,000 to 700,000 tons in the long-rolled segment, translating to approximately 12-13% growth. Significant growth is also anticipated in other segments.
Major customers contributed 32% of the total ferrous segment revenue. In the non-ferrous segment, local major customers accounted for 9% of total revenue, while foreign customers contributed around 85% of total revenue. All ferrous sales were domestic, with 87% of non-ferrous sales being exports, primarily to China.
In FY25, MUGHAL reported a profit of Rs852 million, down 55% year-over-year compared to Rs1.91 billion in FY24. The company is trading at a projected price-to-earnings ratio of 7.6x and 5.4x for FY26 and FY27, respectively.