Fakiha Tariq

Top firms in the engineering sector collectively posted a gross profit of Rs12 billion and a net profit of Rs85 million on the sales of Rs130 million in the first half (July-December) of the current fiscal year 2022-23, WealthPK reports. The gross profit and net profit ratios for the top engineering firms were reported to be 9.31% and 0.07%, respectively, in 1HFY23.

The engineering sector on the Pakistan Stock Exchange constitutes two large, five mid and eight small firms. International Steels Limited (ISL) and Mughal Iron & Steel Industries Limited (MUGHAL) with the market capitalisation of Rs18.8 billion and Rs16.8 billion, respectively, are the two largest firms.

The mid-caps engineering batch includes International Industries Limited (INIL), Agha Steel Ind Limited (AGHA), Aisha Steel Mills Limited (ASL), Amreli Steels Limited (ASTL) and Crescent Steel and Allied Products Limited (CSAP) with market caps of Rs9.5 billion, Rs7.1 billion, Rs6.3 billion, Rs5.2 billion and Rs2.2 billion, respectively. In terms of sales, ISL ranked first and MUGHAL the second, thus being the top contributors of the engineering sector in profit making in 1HFY23. AGHA and INIL reported the highest gross profit ratio of 20% and net profit ratio of 5.88% in 1HFY23.

Top engineering firms – sales in 1HFY23

In terms of revenues, ISL contributed the highest sales of Rs33 billion in 1HFY23 followed by MUGHAL with sales of Rs31 billion and ASTL with sales of Rs23 billion.

ASL and INIL ranked the fourth and fifth largest revenue contributors with sales of Rs15 billion and Rs12 billion, respectively. AGHA and CSAP sales of Rs11 billion and Rs2.5 billion were the smallest contribution to the engineering sector.

Top engineering firms – gross and net profits in 1HFY23

In terms of profit-making, MUGHAL led the sector in 1HFY23 by posting a gross profit of Rs3.3 billion and a net profit Rs1.3 billion, respectively. ISL posted the second highest gross profit of Rs2.9 billion, but posted the lowest-of-all net profit of Rs60 million during the period. ASTL posted the third highest gross profit of R2.4 billion, but sustained a net loss of Rs184 million in 1HFY23. AGHA and INIL posted gross profits of Rs2.2 billion and Rs1.4 billion and net profits of Rs402 million and Rs764 million, respectively.

CSAP produced a gross profit of Rs10 million and a net loss of Rs202 million in 1HFY23. However, ASL remained the only top engineering firm which suffered gross and net losses of Rs271 million and Rs2 billion in 1HFY23.

Top engineering firms – earnings per share in 1HFY23

Among the top engineering firms, INIL posted the highest earnings per share of Rs5.79 followed by MUGHAL with Rs4 per share. AGHA and ISL reported the third and fourth highest EPS values of Rs0.66 and Rs0.14 per share, respectively, in 1HFY23.

However, in the first half of FY23ASL, ASTL and CSAP reported losses per share of Rs2.31, Rs0.62 and Rs2.61, respectively.

Credit: Independent News Pakistan-WealthPk