⏸️ POL: HOLD Signal (5/10) – Financial Results for the Three Months ended September 30, 2025

📌 Key Takeaways

• 📉 **No Dividend:** No interim cash dividend declared for the quarter ended September 30, 2025.
• 📉 **Bonus Shares:** The board did not recommend the issuance of bonus shares.
• 📉 **Right Shares:** No right shares were recommended for issuance.
• 📉 **Net Sales Decline:** Net sales decreased by 15.13% from Rs 15,450.673 million to Rs 13,112.687 million year-over-year.
• ⬆️ **Gross Profit Improvement:** Gross profit increased from Rs 10,077.726 million to Rs 8,513.521 million.
• ⬆️ **Profit Before Tax Increase:** Profit before income tax significantly increased from Rs 4,700.367 million to Rs 8,117.986 million.
• ⬆️ **Profit for the Period Growth:** Profit for the period increased substantially from Rs 2,568.760 million to Rs 5,428.935 million.
• ⬆️ **EPS Surge:** Earnings per share increased significantly from Rs 9.05 to Rs 19.13.
• 💰 **Cash and Cash Equivalents Increase:** Cash and cash equivalents increased to Rs 112,362.644 million as of September 30, 2025.
• ⚠️ **Exploration Costs Reduction:** Exploration costs decreased dramatically from Rs 7,735.350 million to Rs 1,126.414 million.
• ⚠️ **Finance Costs Reduction:** Finance costs decreased from Rs 939.326 million to Rs 528.859 million.
• 🔍 **Other Income Decline:** Other income decreased from Rs 3,746.216 million to Rs 1,857.535 million.

🎯 Investment Thesis

Given the mixed financial performance, a HOLD recommendation is appropriate for POL. While the increase in profitability and EPS is positive, the decline in revenue raises concerns. Further analysis is needed to understand the underlying drivers of the revenue decline and to assess the company’s long-term growth prospects. A price target of Rs. 350, based on a P/E ratio of 18x and FY26 EPS estimate of Rs. 19.13, with a time horizon of 12 months, seems justified. This assumes that POL can stabilize its revenue and sustain its profitability improvements.