⚡ Flash Summary

First Habib Modaraba’s financial results for the quarter ended September 30, 2025, show a decrease in profit after taxation compared to the same period last year. Income from diminishing musharaka financing decreased, impacting overall revenue. Despite a decrease in financial charges, the company’s profit before taxation also slightly decreased. The earnings per certificate also saw a minor decrease year-over-year. No cash dividend, bonus shares or rights shares are being issued.

📌 Key Takeaways

• 📉 Income from diminishing musharaka financing decreased to Rs. 1,119.95 million from Rs. 1,431.53 million year-over-year.
• ⬆️ Reversal in respect of diminishing musharaka financing increased by Rs. 31.89 million compared to a loss of Rs. 57.49 million in the previous year.
• ⚠️ Administrative expenses increased to Rs. 75.10 million from Rs. 62.08 million year-over-year.
• ⬆️ Other income decreased to Rs. 46.58 million from Rs. 61.82 million year-over-year.
• ✅ Financial charges decreased to Rs. 762.50 million from Rs. 1,012.72 million year-over-year.
• 💰 Profit before taxation and levy decreased slightly to Rs. 308.22 million from Rs. 309.60 million year-over-year.
• 📊 Profit before taxation decreased to Rs. 302.46 million from Rs. 301.51 million year-over-year.
• 📉 Profit after taxation decreased to Rs. 184.99 million from Rs. 190.26 million year-over-year.
• 📉 Earnings per certificate (basic and diluted) decreased to Rs. 1.67 from Rs. 1.72 year-over-year.
• 🚫 No cash dividend was declared for the period ended September 30, 2025.
• 🚫 No bonus shares or right shares were announced.
• 🏛️ Authorized certificate capital remains constant at 140,000,000 certificates of Rs. 10 each.

🎯 Investment Thesis

Given the declining financial performance, I recommend a HOLD rating. The decrease in revenue and profitability metrics suggests a need for strategic reassessment to improve core operations. A BUY rating is not justified given the current financial results. The price target will remain the same because the company is still within acceptable range. The time horizon for this recommendation is MEDIUM_TERM.