⚡ Flash Summary

GAMMON Pakistan Limited reported a challenging first quarter for 2026, ending September 30, 2025. The company experienced no contract revenue, leading to a net contract loss. This is attributed to the difficult economic environment in Pakistan, including inflationary pressures and limited government spending. Despite these challenges, management is focused on securing new projects and resolving outstanding issues with Maritime Technologies Complex (MTC). The company remains committed to improving operational efficiency and liquidity.

📌 Key Takeaways

• 🚧 No contract revenue recorded for Q1 2026.
• 📉 Net contract loss of PKR 218,070 for the quarter.
• 😔 Loss before taxation increased significantly to PKR (5,549,083) compared to a profit of PKR 1,607,133 in the same period last year.
• 💸 Taxation expenses decreased to PKR (100,000) from PKR (273,213) year-over-year.
• ❌ Loss after tax widened to PKR (5,649,083) against a profit of PKR 1,333,920 in Q1 2025.
• 🇵🇰 Economic environment in Pakistan remains challenging for the construction sector.
• ⬆️ Rising costs of materials and utilities are impacting profitability.
• सरकार Limited government spending on development projects.
• 📅 Management actively pursuing recovery from Maritime Technologies Complex (MTC) project.
• 💰 Efforts ongoing to realize remaining claims and retention money from completed projects.
• 🔍 Focus on identifying and securing viable new projects.
• 🏦 The company expresses gratitude to bankers, clients, and suppliers.
• 📜 Unclaimed dividends stand at PKR 1,442,230.
• 🏢 Rental Income from Associated companies, such as Ghandhara Automobiles Limited and Bannu Woollen Mills
• 👎 Earning per share – basic and diluted at (0.20) Rupees, was 0.05 Rupees year-over-year

🎯 Investment Thesis

HOLD. Given the significant losses and challenging economic environment, an immediate BUY recommendation is not warranted. However, management’s efforts to secure new projects and resolve outstanding issues offer some potential upside. A HOLD recommendation is appropriate until there is clear evidence of improved financial performance. The company’s share price is likely to remain under pressure in the short term until a turnaround strategy is executed.