⚡ Flash Summary

First Capital Equities Limited (FCEL) reported a significant surge in profit for the three months ended September 30, 2025, with profit after taxation reaching Rs 105.183 million compared to Rs 27.702 million in the same period last year. This increase is primarily driven by a sharp rise in unrealized gains on investments, which jumped to Rs 105.594 million from Rs 28.206 million. Notably, brokerage income and capital gains were nil due to the discontinued brokerage operations. The company is in the process of transitioning its principal business from stock brokerage to real estate.

📌 Key Takeaways

• 📈 Profit surged to Rs 105.183 million in 1QFY26 from Rs 27.702 million in 1QFY25.
• 💰 Unrealized gains on investments increased significantly to Rs 105.594 million from Rs 28.206 million.
• 💼 Brokerage income and capital gains were nil due to discontinued operations.
• ⚠️ Operating expenses increased by 62% during the period.
• 🏢 Company is transitioning from stock broker to real estate business.
• 📜 Application for surrender of trading right entitlement certificate (TREC) submitted to PSX.
• 🏦 Accumulated losses stand at Rs 784.69 million as of September 30, 2025.
• 🏢 Investment property remains constant at Rs 824.776 million.
• 📊 Short term investments increased to Rs 164.525 million from Rs 83.574 million.
• 🏦 Loan from financial institution remains largely unchanged at Rs 642.163 million.

🎯 Investment Thesis

HOLD. FCEL is undergoing a significant transformation, making it difficult to assign a clear BUY or SELL rating. The increase in profitability is promising, but it is largely based on unrealized gains. The company’s success hinges on its ability to successfully transition to the real estate business and generate sustainable revenue. A price target cannot be reliably established without a clearer picture of future earnings. Time horizon is medium-term, contingent on the successful implementation of the business transformation.