⚡ Flash Summary

Popular Islamic Modaraba (PIM) reported a net profit after tax of Rs. 25.71 million for the year ended June 30, 2025, compared to Rs. 24.70 million in the previous year. This growth was attributed to prudent cost management, diversified income sources, and effective resource utilization, despite some moderation in overall income due to reduced financing and compressed financing margins from declining KIBOR rates. The Modaraba also approved a distribution of profit at Rs. 1 per certificate. The board is committed to further strengthening PIM as a reliable and competitive Islamic financial institution.

📌 Key Takeaways

• 📈 Net profit after tax increased to Rs. 25.71 million, up from Rs. 24.70 million in the previous year.
• 💰 Prudent cost management and effective resource utilization drove profitability.
• ⬇️ Overall income moderated due to reduced financing and compressed financing margins from declining KIBOR.
• ✅ Maintained operational stability and delivered sustainable returns to certificate holders.
• 📜 The Board is committed to integrity, fairness, and accountability.
• 🤝 Expressed appreciation for stakeholders’ trust and confidence.
• 🌱 Actively seeking to strengthen PIM as a competitive Islamic financial institution.
• 📊 Total income was Rs. 41.74 million, compared to Rs. 45.69 million in the preceding year.
• 📉 Operating expenses were contained at Rs. 8.88 million, a reduction from Rs. 10.18 million in the previous year.
• 🏢 Depreciation on Ijarah assets was Rs. 4.55 million compared to Rs. 6.80 million in the previous year.
• 💸 Other income increased to Rs. 2.46 million from Rs. 1.84 million in FY 2024.
• 📜 The Modaraba converted the loan through “other than right issue” and issued certificates to the Management company
• 📉 Earning per certificate reduced from Re.1.76 to Re.1.39
• ✅ Approved the distribution of profit at Rs. 1/- per certificate of Rs.10/- each (i.e. 10%)

🎯 Investment Thesis

HOLD. Given consistent profitability, PIM appears to be a stable investment. However, modest profit growth and declining certificate returns could indicate less upside potential. The distribution of Rs. 1 per share demonstrates management’s confidence in future operations. But based on current financial performance, PIM presents a moderate hold.