AKD Securities Limited - Off the Analyst's Desk.

Karachi -- October 27, 2022 (PPI-OT)

INDU: 1QFY23 Result Review

Indus Motor Company Limited (INDU) announced its 1QFY23 result today where it posted a NPAT of PkR1.3bn (EPS: PkR16.5), up by 155%QoQ owing to the Supertax applicable last quarter, while down 76%YoY. The result is well below industry expectations as the company has posted a gross loss for only the second time in its history.

The company recorded PkR37.2bn in revenue for the first quarter of the year, decreasing by 48%QoQ while also down 43%YoY, in line with our expectations. The low revenue is due to the curb on imports of CKD kits, which has caused offtakes to drop by 51%QoQ and 53%YoY.

Gross loss for 1QFY23 is PkR2.4bn on the back of dismal gross margins, clocking in at a whopping -6.3% for the quarter. We believe the margins have decreased this quarter on the back of high freight charges on...