⚡ Flash Summary
Prosperity Weaving Mills Ltd. (PWML) held a corporate briefing session for 2024-25. The presentation included financial highlights, with a focus on the material variations in the Balance Sheet and Income Statement for the year ended 2025. While sales decreased slightly, profitability metrics such as gross profit and profit before tax also declined. The company highlighted current and future challenges including low fabric demand, policy issues related to energy tariffs, and energy costs.
📌 Key Takeaways
- 📉 Sales decreased from Rs. 18,745.628 million in 2024 to Rs. 18,191.084 million in 2025.
- ⚠️ Gross profit decreased from Rs. 1,182.106 million in 2024 to Rs. 1,186.197 million in 2025.
- ⚠️ Profit before tax decreased significantly from Rs. 227.390 million in 2024 to Rs. 390.853 million in 2025.
- ⚠️ Profit after tax increased from Rs. 86.655 million to Rs. 91.123 million in 2025.
- ⚠️ Finance costs decreased by Rs. 152.615 million due to a drop in the average interest rate.
- ⚠️ Accrued interest/mark-up decreased by Rs. 30.325 million due to lower average interest rates on advances.
- ⚠️ Other operating expenses increased by Rs. 6.426 million due to higher provisions for Wage Price Index (WPI) and salary increases.
- 💰 Sales Tax Refundable increased significantly by Rs. 206.018 million due to large receivable balances.
- ✅ Other financial assets increased by Rs. 32.444 million due to market price gains on financial assets held.
- 🏭 The company has 382 air jet looms installed.
- 👨💼 The total number of employees is 1,154.
- 🔥 The company produces over 6 million meters of fabric annually.
- ⚠️ Current challenges include low fabric demand, unpredictable policy issues, and high energy costs.
🎯 Investment Thesis
HOLD. The company faces challenges with declining sales and profitability but has managed to maintain some profit through financial asset gains. A stable exchange rate and reduction in policy rate are positives, but uncertainties regarding fabric demand and energy policies remain concerns. The stock is fairly valued at the current market price. We need to see more robust operational performance before considering a BUY rating.
Disclaimer: AI-generated analysis. Not financial advice.