⚡ Flash Summary
Thal Limited’s unconsolidated results for the quarter ended September 30, 2025, show a significant increase in sales revenue but a sharp decline in profit. Unconsolidated sales revenue surged by 65% to Rs. 9.5 billion compared to the previous year, driven by growth in both the Engineering and Building Materials segments. However, profit after taxes decreased by 45% to Rs. 182 million, indicating challenges in maintaining profitability despite strong revenue growth. The company is focused on diversification, localization, and cost optimization to improve future performance.
📌 Key Takeaways
- 📈 Unconsolidated revenue increased by 65% YoY, reaching Rs. 9.5 billion.
- 📉 Unconsolidated profit after tax decreased by 45% YoY to Rs. 182 million.
- 🏭 Engineering segment sales grew over 70% YoY to Rs. 5.2 billion.
- 🧱 Building Material & Allied Products segment turnover increased by 54% YoY to Rs. 4.3 billion.
- ⬆️ Jute business sales increased by 76% YoY due to export focus.
- ⚠️ Jute business margins were adversely impacted by rising raw material and freight costs.
- 🌱 Packaging division sales grew by 42% YoY but faced competitive pressures.
- 🤝 TBPPL (Thal Boshoku Pakistan) sales increased to Rs. 774 million from Rs. 649 million in the previous year’s first quarter.
- ⛏️ SECMC continues to deliver full operational availability, supplying coal to 1,320 MW of power capacity.
- ⚡ ThalNova achieved commercial operations date (COD) in February 2023.
- 🌾 Investment in Thal Grainfoods for a high-quality storage facility for major grains is underway.
🎯 Investment Thesis
A Hold recommendation is warranted. While Thal Limited demonstrates robust revenue growth, the substantial decline in profitability necessitates a cautious approach. The company’s strategic initiatives, including diversification and localization, need to materialize into improved earnings to justify a more bullish outlook. Without that, the stock presents more risk than it does upside. A price target cannot be set without a future increase in earnings.
Disclaimer: AI-generated analysis. Not financial advice.