D.G. Khan Cement Company Limited (DGKC): 2QFY25 EPS clocked in at Rs6.21, up 6.9x YoY - By Foundation Research

Feb 20 2025


Foundation Securities


  • D.G. Khan Cement Company Limited (DGKC PA) profitability clocked-in at Rs2.7bn (EPS Rs6.21), up 3.4x QoQ. Similarly, profits soared 6.9x YoY in 2QFY25 as compared to profit of Rs394mn in 2QFY24. This takes 1HFY25 profit to Rs3.5bn (EPS Rs8.0), as against profit of Rs1.0bn (EPS Rs2.41) in 1HFY24. The company did not announce an interim dividend.
  • Revenue of the company was higher than our expectations while the cost of goods sold came in line with our estimates. Variance in the topline could be a result of higher than expected retention prices on both local and export fronts. This has resulted in realized gross margins of over 25% vs. our anticipation of 19% in 2QFY25.
  • DGKC’s local/export sales surged by 38/17% QoQ on the back of improved local demand amid seasonality factor and higher export volumes.
D.G. Khan Cement Company Limited (DGKC): 2QFY25 EPS clocked in at Rs6.21, up 6.9x YoY - By Foundation Research

Feb 20 2025


Foundation Securities


  • D.G. Khan Cement Company Limited (DGKC PA) profitability clocked-in at Rs2.7bn (EPS Rs6.21), up 3.4x QoQ. Similarly, profits soared 6.9x YoY in 2QFY25 as compared to profit of Rs394mn in 2QFY24. This takes 1HFY25 profit to Rs3.5bn (EPS Rs8.0), as against profit of Rs1.0bn (EPS Rs2.41) in 1HFY24. The company did not announce an interim dividend.
  • Revenue of the company was higher than our expectations while the cost of goods sold came in line with our estimates. Variance in the topline could be a result of higher than expected retention prices on both local and export fronts. This has resulted in realized gross margins of over 25% vs. our anticipation of 19% in 2QFY25.
  • DGKC’s local/export sales surged by 38/17% QoQ on the back of improved local demand amid seasonality factor and higher export volumes.
D.G. Khan Cement Company Ltd. (DGKC): 2QFY25 Result Review — Earnings surge on higher offtakes & prices - By AKD Research

Feb 19 2025


AKD Securities


  • D.G. Khan Cement Company Ltd. (DGKC) announced its 2QFY25 financial results, reporting earnings of PkR2.7bn (EPS: PkR6.2), a 6.8xYoY increase from the NPAT of PkR403mn (EPS: PkR0.9) in SPLY. Earnings came above our expectations, mainly due to higher-thanexpected retention prices and lower taxation.
  • Revenue increased by 19%YoY to PkR21.7bn, compared to PkR18.3bn in SPLY, driven by 15%YoY increase in total offtakes to 1.54mn tons and a 6%YoY rise in retention prices.
  • Gross margins improved to 25.1% from 12.8% in SPLY, supported by increased retention prices and 7%YoY decline in weighted avg. coal prices for the North amid lower local coal prices.
D.G Khan Cement (DGKC): Result Preview 2QFY25 - By AHCML Research

Feb 17 2025


Al Habib Capital Markets


  • DGKC is anticipated to declare a profit after tax of PKR 2,012mn (EPS: PKR 4.59) in 2QFY25, reflecting a gain of 150% QoQ.
  • During the quarter, sales are expected to reach PKR 21,458mn, indicating an increase of 40%QoQ.
  • We estimate gross margins at 21%, representing an increase of 1.74ppt QoQ and 8.56ppt YoY.
Pakistan Cement: DGKC, KOHC & ACPL: 2QFY25 result previews - By JS Research

Jan 23 2025


JS Global Capital


  • We present 2QFY25 earning expectations for DG Khan Cement Company Ltd (DGKC), Kohat Cement Company Ltd (KOHC), and Attock Cement Pakistan Ltd (ACPL). We anticipate KOHC and DGKC to report a YoY increase in earnings, driven by higher retention prices in the North and reduced costs of Afghan and local coal. Conversely, ACPL is expected to see a YoY decline in earnings due to slightly narrower margins and a normalized effective tax rate (4% in 2QFY24).
  • KOHC is expected to post an EPS of Rs13.46, up 19% YoY whereas DGKC is expected to post an EPS of Rs4.51, up 5x YoY. We expect ACPL to post an EPS of Rs1.91, a 47% YoY decrease.
  • Cement prices in the North region have stabilized after a gradual decline in late December and early January. We anticipate prices to strengthen further as cement demand increases in the summer months and the effects of monetary easing materialize. DGKC is our preferred pick among these stocks
D.G Khan Cement Company Ltd (DGKC): Beneficiary of the monetary easing cycle; Buy – By JS Research

Jan 14 2025


JS Global Capital


  • We reiterate our ‘Buy’ rating for D.G Khan Cement Company Ltd (DGKC) with a Dec-2025 SoTP based target price of Rs140 for the stock, with Rs66 attributed to the company’s diversified equity portfolio, offering a potential upside of 40%.
  • We expect DGKC to be the key beneficiary of the monetary easing cycle in our Cement universe as we project the company’s interest coverage ratio to improve significantly, rising from 1.37x in FY24 to 2.28x in FY25E and further to 3.9x in FY26E.
  • We highlight that DGKC’s core business margins, which remained sticky for quite some time, are expected to improve due to the gradual convergence of North and South prices and a better sales mix.
United Bank (UBL): 1QCY25 EPS clocked in at PKR28.8 – Above expectation - By Insight Research

Apr 16 2025


Insight Securities


  • UBL has announced its 1QCY25 result, wherein it has posted consolidated PAT of PKR36.1bn (EPS: PKR28.8) vs. PAT of PKR16.1bn (EPS: PKR12.9) in SPLY. The result is above our expectation due to higher than estimated NII and reversal in provisioning expense.
  • Net interest income clocked in at PKR84.2bn, up by 200%/24% YoY/QoQ. The increase is attributable to favorable pricing of investment book aided by healthy volumetric growth and higher share of zero cost deposits.
  • Non markup income declined by 21%/38% YoY/QoQ despite a healthy increase of 26%/90% YoY/QoQ in fee income. The decline is primarily driven by elevated gain on securities in preceding quarters.
United Bank (UBL): Recorded highest ever quarterly earnings in 1Q2025 - By Topline Research

Apr 16 2025


Topline Securities


  • United Bank (UBL) announced its 1Q2025 result today, where the bank recorded highest ever quarterly earnings of Rs36bn (EPS of Rs28.9), up 126% YoY and 39% QoQ.
  • UBL's 1Q2025 earnings exceeded industry expectations, which ranged between Rs12.8–22.9 per share, and were also the highest ever recorded for any bank in a single quarter.
  • The significant jump in in earnings is due to increase in Net Interest Income (NII).
United Bank Limited (UBL): 1QCY25 EPS clocks-in at PKR 29.3; PAT up 1xYoY/39%QoQ - By Taurus Research

Apr 16 2025


Taurus Securities


  • 1QCY25 EPS: PKR 29.3. 1QCY25 PAT up 1xYoY. UBL also announced an interim cash dividend of PKR 11/sh. The Bank also plans to sub-divide the face value of its shares in the ratio of 2:1 subject to approval by shareholders.
  • Net Interest Income (NII): Up 2xYoY/24%QoQ, in line with expectations amid significant drop in interest expenses due to the lower cost of funds on the back of build-up in current accounts and the revised MDR regime. Deposits are up ~29% YTD.
  • Non-Markup Income (NMI): Down 20%YoY/38%QoQ, owing to ~77% drop in capital gains compared to 4QCY24
Pakistan Economy: Feb’25 LSMI down 5.9%MoM/down 3.5%YoY - By Taurus Research

Apr 16 2025


Taurus Securities


  • Large Scale Manufacturing Index (LSMI) down 5.9%MoM in Feb’25, due to decline from key sectors i.e. Furniture (-56%), Machinery & Equipment (-34%) and Chemical Products (-19%). Whereas, top contributors were Other Transport Equipment (38%), Automobiles (31%), Coke & Petroleum Products (23%) and Tobacco (18%), respectively. 8MFY25 LSMI was down 1.9%YoY.
  • Textile production declined by ~0.33%YoY in Feb’25 attributable to decline in production of jute goods, woolen & worsted cloth and woolen blankets by 36.65%YoY, 3.66%YoY and 94.76%YoY, respectively— mainly due to the lower domestic and international demand driven by a seasonal shift that reduced the overall requirement of these products. Whereas, on a monthly basis it significantly declined by ~3.24%MoM, mainly due to the decline in production of jute goods, terry & towels, woolen & carpet yarn and woolen blankets by 19.56%MoM, 7.34%MoM, 4.42%MoM and 94.21%MoM, respectively
  • Automobile production down ~5%MoM in Feb’25. Wherein, Jeeps & cars production declined by 10%MoM. Similarly, LCVs production down ~13%MoM, respectively. On a YoY basis, production of LCVs, Jeeps & Cars, Trucks and Buses went up by ~23%, 26%, 1.8x and 48% on the back of controlled manufacturing costs, stable tariffs, eased import restrictions on CKD units and recovering demand due to improving macros.
Lotte Chemical Pakistan Limited (LOTCHEM): Earnings Hold Steady as PTA Margins Remain Underwhelming - By IIS Research

Apr 16 2025


Ismail Iqbal Securities


  • We expect LOTCHEM to report a PAT of PKR 779 million (EPS: PKR 0.51) for 1QCY25, compared to LPS 0.01 in last quarter. This improvement comes as operations normalize following a one-month plant turnaround last quarter. PTA sales volumes are also anticipated to recover to typical levels. However, PTAPX margins have averaged USD 100/ton this quarter, lower than the USD 122/ton in the past six years and the long term average of USD 110/ton, largely due to global dynamics and subdued international demand.
  • Additionally, this quarter is affected by the recent gas price hike. Where, the gas price for captive power plants has increased to Rs 3,500 per MMBtu, effective February 1, 2025. While this increase poses some pressure, it's worth noting that LOTCHEM’s cost structure and margins are largely driven by international PTA-PX spreads. Notably, in CY24, only around 7% of COGS was from oil, gas, and electricity expenses. Furthermore, the company is in the process of being acquired, as AsiaPak Investments Limited and Montage Oil DMCC entered into a share purchase agreement to acquire a 75.01% stake in LOTCHEM.
Bank Al-Falah Limited (BAFL): 1QCY25 EPS to clock-in at PKR 3.3; PAT down 47%YoY/up 13%QoQ - By Taurus Research

Apr 16 2025


Taurus Securities


  • Board Meeting: Thursday, April 17, 2025
  • 1QCY25 EPS: PKR 3.3. 1QCY25 PAT down 47%YoY. BAFL is also expected to announce a cash dividend of PKR 2.0/sh.
  • Net Interest Income (NII): We anticipate net interest income to post a drop of 9%YoY/11%QoQ mainly on account of falling yields on investments and re-pricing of the loan book; partially offset by a lower cost of funds due to the rate cut in Jan’25 and the impact of revised MDR regime coming into effect Jan’25 onwards
Commercial Bank: Banking Sector’s Dividends Payouts to Persist Despite Earnings Attrition in 1QCY25 - By Pearl Research

Apr 16 2025


Pearl Securities


  • We preview 1QCY25 earnings result for commercial banks within our coverage. We expect earnings of the Pearl banking universe to witness erosion of 3.6% QoQ due to NIM compression coupled with tapering off of growth in non-core income.
  • Notably, we expect the lagged impact of asset repricing and declining asset yields amid aggressive monetary easing measures to serve as a headwind for interest income, which nonetheless should partly be counteracted by volumetric balance sheet growth.
  • Additionally, we anticipate the offsetting decline in cost of deposit to remain relatively muted compared to the previous quarter despite strategic shift into low-cost deposits by the sector, thereby resulting in core income witnessing a contraction of ~6% QoQ, according to our estimates
Technical Outlook: KSE-100; Consolidation likely above key averages - By JS Research

Apr 16 2025


JS Global Capital


  • The KSE-100 index extended the gain to close at 116,776, up 385 points DoD. Volumes stood at 479mn shares compared to 485mn shares traded in the previous session. The index is expected to revisit yesterday’s high of 117,362 where a break above targeting 118,718 level. However, any downside will find support at the 30-DMA which is currently at 115,631. The RSI and the Stochastic Oscillator have moved up, supporting a positive view. We recommend investors to ‘Buy on dips’, with risk defined below the 30-DMA. The support and resistance levels are at 116,493 and 117,210 levels, respectively.
Engro Powergen Qadirpur Limited (EPQL): 1QCY25 EPS arrive at PKR 1.19, up 1.5xQoQ - By Taurus Research

Apr 15 2025


Taurus Securities


  • 1QCY25 EPS: PKR 1.19; DPS: PKR 7.5.
  • Revenue increased 9%QoQ to PKR 3.1Bn, attributed to improved dispatches amid seasonal demand recovery. However, YoY growth remained flat due to the impact of revised PPA terms, which converted the plant's structure to a 'take-and-pay' regime, limiting guaranteed capacity payments.
  • Finance income stood at PKR 26Mn versus PKR 238Mn in 1QCY24 (SPLY), reflecting the absence of late payment surcharge (LPS) which previously contributed significantly. The decline was anticipated after the company received PKR 8.04Bn in overdue receivables under the revised PPA settlements.
Commercial Banks: 1QCY25 Result Preview: Payouts to remain intact - By AKD Research

Apr 15 2025


AKD Securities


  • AKD Banking Universe is set to announce its 1QCY25E results, where we expect profitability to decline by 12%QoQ, as contraction in NIMs and a drop in nonmarkup income are expected to outweigh the impact of lower operating expenses and reduced taxation.
  • We anticipate our banking universe to maintain dividends in the first quarter, supported by resilient capitalization amid monetary easing, recovery in macro economic variables and removal of mandated ADR based taxation during the previous quarter.
  • Profitability to take a hit from declining yields: AKD Banking Universe is set to announce its 1QCY25E results, where we expect profitability to decline by 12%QoQ to PkR75.1bn, as contraction in NIMs and a drop in non-markup income are expected to outweigh the impact of lower operating expenses and reduced taxation.
Pakistan Automobile: Strong auto sales momentum carried into Mar’25 - By Foundation Research

Apr 11 2025


Foundation Securities


  • In Mar’25, automobile sales grew 18% YoY, however, on a sequential basis volume declined 8% MoM to 11k units due to Ramadan effect. During 9MFY25, sales expanded by a mammoth 46% YoY to over 100k units. This surge can be attributed to declining interest rates, attractive auto financing schemes and promotional offers by both banks and auto assemblers. Player-wise breakdown portrays a notable volumetric surge of 84/87% YoY in INDU/SAZEW, respectively while HCAR recorded a decline of 35% YoY in Mar’25. Total automobile sales clocked in at 13k units (↓ 8/7% YoY/MoM) in Mar’25 whereas 9MFY25 sales were 127,463 units (↑20% YoY).
  • Positive sales growth remains prolific: The automobile sector witnessed a surge in sales during Mar’25 as Jeeps/Vans&LCVs/800/1300cc sales improved by 85/42/6/17% YoY while 1000c sales dropped by a sizeable 71% YoY. During 9MFY25, automobile sales surged 46% YoY to 100,868 units led by growth in INDU, HCAR, Pak Suzuki & SAZEW at 58%, 29%, 41% and 153% YoY, respectively. The healthy volumetric growth is on the back of (1) declining interest rates, (2) attractive auto financing schemes by banks & auto assemblers amid increasing market competition, (3) stable exchange rate and HRC prices, and (4) improving macroeconomic environment
  • INDU: INDU recorded volumes of 3,131 units, up 84% YoY (↑20% MoM) during Mar’25. The surge in sales is driven by a rise in sales of Corolla+Cross+Yaristo 2,378 units, a jump of 54% YoY (↑31% MoM), which we believe is owed to higher Yaris sales. Additionally, Fortuner+Hilux sales climbed 4.8x YoY (↓5% MoM) to 753 units with Hilux being the major contributor. During 9MFY25, sales of Corolla+Cross+Yaris/Fortuner+Hilux swelled 49/90% YoY to 15,980/5,638 units respectively.
Mughal Iron & Steel Industries Limited (MUGHAL): 1HFY25 Analyst Briefing Key Takeaways - By Foundation Research

Apr 9 2025


Foundation Securities


  • Mughal Iron & Steel Industries Limited (MUGHAL PA) held its analyst briefing to discuss the company’s financial performance during 1HFY25 and outlook.
  • Mughal Iron & Steels Industries Ltd’s(MUGHAL PA) profitability clocked in at PKR 210Mn (EPS PKR 0.63, down 73% YoY) in 2QFY25 against PKR 773Mn (EPS PKR 2.30) in 2QFY24. This takes 1HFY25 profitability to PKR 217Mn (EPS PKR 0.65, down 83% YoY) as compared to profit of PKR 1.3Bn (EPS 3.84) in 1HFY24.
  • Currently, the company is operating at maximum operational capacity; capacity utilization of furnace plant for melting is 80% and 65-67% for re-rolling. Moreover, the production mix for girders and rebars is 40-45% and 50-55%, respectively.
Pakistan Cement: Sales dropped MoM in Mar’25 due to Ramadan, prices in recovery phase - By Foundation Research

Apr 8 2025


Foundation Securities


  • Pakistan cement industry dispatches notched down by 9.4% YoY in Mar’25 to 3.57Mn tons (9MFY25: down 1.5% YoY to 33.99Mn tons). Domestic sales plummeted 11.3% YoY to 2.96Mn tons (9MFY25: -6.6% YoY), while exports exhibited an increase of 0.6% YoY to 0.61Mn tons in Mar’25 (9MFY25: +28.1% YoY).
  • Local cement sales remained lackluster during Mar’25 MoM due to Ramadan effect and Eid-ul-fitr holidays. Exports shot up by 28.1% YoY in 9MFY25 as cement players continue to explore new export destinations given the prevailing weak local demand.
  • On a YoY basis, domestic cement sales declined 11.3% during Mar’25 YoY on the back of (1) rise in royalty rates, (2) cement dealers strike pertaining to WHT and implementation of Point of Sale (POS) in Jul’24, (3) hike in cement prices (FED increased to PKR 4/kg in FY25 Budget), (4) elevated construction costs, and (5) high base effect given that this year Ramadan fell during the month of Mar’25 (ie. 10 days earlier).
Sazgar Engineering Works Limited (SAZEW): Revving up for the new era - By Foundation Research

Apr 7 2025


Foundation Securities


  • In a rapidly evolving automotive landscape, SAZEW’s entry into Pakistan’s 4-wheeler market capitalizing on the surging demand for SUVs, marked a pivotal moment. At the heart of this transformation stood the company’s resolve at redefining the industry with its sustainable forward-thinking approach - leveraging Greenfield incentives and expanding into the electric and hybrid segments. With the expected resurgence in the Auto sector, our positive view is underpinned by the company’s (1) brand equity of “HAVAL” in the 4-wheeler market, (2) robust gross margins to upkeep bottom-line, (3) efforts to penetrate further into the EV and HEV segment solidifying its green foot prints and (4) growth in iconic “SAZGAR” 3-wheelers along with broad products offerings - diversifying operational risks. In the light of the above, we initiate coverage on SAZEW with an ‘Outperform’ rating and a Dec’25 TP of PKR 1,504/sh, implying a 38% upside.
  • HAVAL's success story: HAVAL made its entry into the Pakistani market at a very opportune time. Where the SUV segment was slowly growing post the launch of KIA Sportage, MG-HS and Hyundai Tucson to name a few, HAVAL made a solid entry with the launch of Pakistan’s first locally assembled HEV. Consequently, the company has sold over 14k units in just 30 months. In 8MFY25, sales have exceeded 7k units and given the momentum, we opine reaching 12k mark in FY25 would not be a challenging feat. Plus, the collaboration with HIT to convert HAVAL H6 into a security vehicle and the recent MOU signed with Armed forces suggest robust volumetric growth going forward.
  • Elevated margins to stabilize but still remain higher than peers: SAZEW benefits greatly from its Greenfield status and AIDEP (2021-26) policy providing CD and ST concessions, which have resulted in stellar ~29% gross margins over the past 4 quarters compared to only ~10% when 3-wheelers was its main operating segment. Upwelling margins are expected to remain intact till FY26 when concessions end, whereby, we see them settling at ~16.5% in the longer term.
Pakistan Fertilizer: Sluggish trend continues - By Foundation Research

Mar 17 2025


Foundation Securities


  • With the Rabi season ending and no major sowing being done, fertilizer offtake continues its sluggish trend. In Feb’25, Urea sales recorded a decline of 36/22% YoY/MoM to 347KT. Company wise analysis reveals that FATIMA urea offtake improved 42/24% YoY/MoM to 69KT in Feb’25, whereas FFC/EFERT recorded a decline of 35/52% YoY to 156/94KT, respectively. Industry DAP offtake dwindled 65/35% YoY/MoM in Feb’25 to only 40KT. FFC/EFERT DAP offtake declined 83/86% YoY to 25/3KT, respectively, whereas FATIMA DAP offtake inclined 22/64% YoY/MoM to 4KT.
  • Fertilizer sales remained lethargic in Feb’25: Pakistan domestic Urea offtake declined by 36/22% YoY/MoM in Feb’25, reaching 347KT. DAP offtake dropped 65/35% YoY/MoM to 40KT. NP offtake lessened/increased 46/19% YoY/MoM in Feb’25 to 44KT, while CAN offtake deteriorated 3/12% YoY/MoM to 66KT. Industry urea inventory levels have stayed on the lower end due to no imports and lower production reaching 536KT in Feb’25. DAP inventory has also eased off to 160KT due to no imports in Feb’25. Companywise urea inventory was recorded at 67/280/168/21KT for FFC/EFERT/FATIMA/AGL, respectively, in Feb’25. DAP inventory of FFC/EFERT reached 66/57KT.
  • FFC/EFERT offtake dropped YoY: FFC/EFERT urea offtake dwindled 35/52% YoY, respectively, to reach 156/94KT in Feb’25. We attribute this decline solely to the seasonality factor. Where the whole industry has undergone decline in offtake, FATIMA experienced a surge in Urea dispatches to the tune of 42% YoY to 69KT. This increase in sales is attributable to better gas availability in recent months.
Indus Motor Company Limited (INDU): 1HFY25 Analyst Briefing Key Takeaways - By Foundation Research

Mar 13 2025


Foundation Securities


  • Indus Motor Company Limited (INDU PA) held its analyst briefing today to discuss the company’s financial performance during 1HFY25 and future outlook.
  • INDU posted net sales of PKR 84.8Bn (↑67% YoY) in 1HFY25, which were driven by surge in volumes. INDU sold 12,541 units (↑82% YoY) in 1HFY25, with contribution from Corolla+Yaris+Cross & Fortuner+Hilux of 9,633 & 2,908 units respectively, up 83% & 52% YoY.
  • The company’s gross margin improved from 9.3% to 13.8% in 1HFY25 given lower input cost aided by favorable exchange rate, cost optimization, and localization efforts. Additionally, investment in green energy has also been fruitful in reducing cost as Solar Energy contributes ~25% in the power mix.
Pakistan Automobile: Auto Sales remained upbeat in Feb’25 - By Foundation Research

Mar 12 2025


Foundation Securities


  • In Feb’25, automobile (PC&LCVs) sales grew 24% YoY, however, on a sequential basis volumes declined 27% MoM to 12k units as January effect dissipated. During 8MFY25, sales expanded by a significant 50% YoY to 89.8k units. This surge is accredited to declining interest rates, attractive auto financing schemes and promotional offers by both banks and companies. Player-wise breakdown portrays a notable volumetric surge of 28/35/113% YoY in INDU/HCAR/SAZEW respectively in Feb’25. Total automobile sales clocked in at 14,104 units (↑/↓ 5/30% YoY/MoM) in Feb’25 while 8MFY25 sales touched 114k units (↑24% YoY).
  • Positive sales growth momentum continues: The automobile sector witnessed a surge in sales during Feb’25 as 800/1000/1300cc sales improved modestly by 6/7/19% YoY. During 8MFY25, automobile sales increased 50% YoY to 89,770 units led by growth in INDU, HCAR, Pak Suzuki & SAZEW at 54%, 47%, 44% and 166% YoY respectively. The healthy volumetric growth is on the back of (1) monetary easing, (2) attractive auto financing schemes by banks amid increasing market competition, (3) stable exchange rates and HRC prices, and (4) improving macroeconomic environment.
  • INDU recorded volumes of 2,611 units, up 28% YoY (↓22% MoM) during Feb’25. The surge in sales is driven by a rise in sales of Corolla+Cross+Yaris to 1,820 units, a marginal ↑3% YoY (↓15% MoM), with major portion coming from Yaris sales in our view. Additionally, despite tough competition from Ghandhara Automobiles (GAL) by their successful launch of JAC T9 Hunter (LCV), a direct competitor of Hilux, Fortuner+Hilux sales climbed 2.9x YoY (↓33% MoM) to 791 units. During 8MFY25, sales of Corolla+Cross+Yaris/Fortuner+Hilux expanded 48/74% YoY to 13,602/4,885 units respectively.
Pakistan Economy: Policy rate left unchanged at 12.0% - By Foundation Research

Mar 11 2025


Foundation Securities


  • SBP surprised markets on Monday by keeping the policy rate steady at 12.0%, defying expectations of a 50-100 basis point cut. Although February's inflation rate came in lower than expected, the SBP cited concerns over volatile food prices, persistent core inflation, and renewed external account pressures as reasons for maintaining the rate. The central bank believes real interest rate remains sufficiently high to support ongoing macroeconomic stability. We believe that the pause was also warranted by a desire to appease the visiting IMF mission which is undertaking the 1st review of the USD 7.0Bn facility, and concerns that the full impact of the 1,000bps cut in policy rate over the last 6 reviews would manifest itself in the form of higher growth and imports over the next 6-12 months and disbalance the external account.
  • February's CPI inflation dropped to 1.5% YoY, its lowest level since Sept’15, primarily due to a decrease in food prices resulting from ample agricultural supplies. However, core inflation in rural areas remained high, with double-digit growth indicating persistent underlying price pressures. Looking ahead, SBP expects headline inflation to decline further before gradually rising and stabilizing within the 5-7% target range.
  • Despite the ongoing decline in manufacturing output, the SBP remains optimistic about economic growth, pointing to encouraging high-frequency indicators and reduced risks to Rabi crops. The SBP expects economic activity to pick up pace during the 1HCY25, driven by easing financial conditions and the delayed impact of previous policy rate cuts. The GDP growth forecast for FY25 remains unchanged at 2.5-3.5%. This outlook follows a modest 0.9% YoY economic expansion in 1QFY25.
Pakistan Economy: Another 100bps cut expected - By Foundation Research

Mar 7 2025


Foundation Securities


  • The Central Bank has been in hot pursuit of the nose-diving inflation over the last nine months trying to catch up with the curve and narrow the real interest rate gap which is still 10/5/3% on current, 1-yr forward and core measures, respectively. Moreover, inflation has averaged 5.9% in 8MFY25 and avg. inflation during FY25 is expected to clock-in at only 5.4% which is near the lower end of the 5-7% inflation target range of the SBP.
  • Viewed together with being in an IMF program, a surplus in the external account during 7MFY25, stable exchange rate and subdued growth outlook, we believe the Central Bank is poised to deliver another cut of 100bps in the policy rate taking it to 11.0% at the Monetary Policy meeting scheduled on 10th Mar’25. At this level, the monetary policy stance would still be significantly tight and data dependent (as required by IMF).
Oil Marketing Companies: Volumes register uptick - By Foundation Research

Mar 4 2025


Foundation Securities


  • During the month of Feb’25, POL sales increasd 2% YoY (↓18% MoM) to 1.1mn tons amid pick up in economic activity and reduced pilferage of Iranian fuel. Product-wise breakdown reveals MS/FO sales jumped 2/7% YoY during Feb’25 whereas HSD underwent a decline of 4% YoY. Company-wise analysis depicts that PSO/APL/WAFI volumes plummeted 17/10/6% YoY during Jan’25. Total sales clocked-in at 10.5mn tons (↑4% YoY) during 8MFY25.
  • White oil: Domestic petroleum sales (ex-non Energy) improved 2% YoY in Feb’25 while white oil sales declined a mere 1% YoY. Sequentially, volumes went down 18% given seasonality. Product-wise analysis reveals that MS/HSD sales clocked-in at 556/428K tons, up/down 2/4% YoY (↓11/29% MoM) while prices of MS/HSD rose MoM to ~Rs258/267/ltr during the month. This takes 8MFY25 sales of MS/HSD to 4.9/4.5mn tons, reflecting growth of 4/9% YoY respectively.
  • In the black oil segment, FO sales grew 7% YoY to 53K tons during Feb’25 despite lower demand from power producers amid higher proportion of hydel, nuclear, RLNG, gas and coal power generation. During 8MFY25, FO sales fell 42% YoY.
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