⏸️ BTL: HOLD Signal (5/10) – Transmission of Annual Report for the Year Ended

📌 Key Takeaways

• ❌ BTL reported a loss after taxation of PKR (96.88) million for the year ended June 30, 2025, a significant improvement from the prior year loss of PKR (1,706.23) million.
• 📉 Revenue from contracts with customers decreased by 4.36% YoY to PKR 30,433.10 million.
• ⬆️ Gross profit margin improved to 7.21% compared to 3.84% in the previous year.
• 🚫 No dividend was declared for the fiscal year ending June 30, 2025.
• ⚠️ The company faces rising inventory levels driven by competition from regional textile producers.
• 📊 Basic loss per share significantly improved to (15.06) Rupees compared to (265.27) Rupees in the prior year.
• 💰 The company’s gearing ratio marginally decreased to 1.65 from 1.40 in the previous year.
• ⚡️ Renewable energy initiatives include the installation of around 4.17 mega-watts of solar energy.
• 🌱 The company is committed to reducing emissions by 30 to 40 percent over the next five years.
• 🤝 The company emphasizes diversity, equity, and inclusion (DEI) in the workplace.
• ✔️ The statutory auditors have issued a clean audit report on the financial statements.
• 🌐 Pakistan’s textile exports reached $17.88 billion a 7.22 percent increase from the previous year.
• 📉 Cotton production in Pakistan observed a sharp decline to 5.52 million bales a staggering 34 percent year-on-year decrease.

🎯 Investment Thesis

A ‘HOLD’ recommendation is appropriate given the current financial results. While there is improvement relative to the prior year, a loss was still reported. Further evidence of sustained profitability and careful management of inventory and financial risk is needed before a more positive recommendation can be made. A conservative price target reflecting book value (subject to reassessment after a period of profitability and efficiency) with a medium-term horizon of 18-24 months seems reasonable.