⚡ Flash Summary

Ferozsons Laboratories Limited has reported a positive first quarter for fiscal year 2025. Revenue increased significantly year-over-year, driving an increase in gross profit. The company demonstrated improved operational efficiency, translating to higher profit from operations, though finance costs remain a significant expense. Overall, the company’s performance suggests a positive trajectory for the near term, with earnings per share increasing from 3.23 to 4.20.

📌 Key Takeaways

• 🚀 Revenue surged by 15.8%, from PKR 3.36 billion to PKR 3.88 billion.
• 💰 Gross profit jumped by 20.9%, reaching PKR 1.58 billion from PKR 1.31 billion.
• 📈 Profit from operations increased by 5.65%, reaching PKR 377.3 million.
• 💸 Finance costs decreased significantly from PKR 158.6 million to PKR 79.9 million.
• ✅ Profit before income tax rose substantially, reaching PKR 292.4 million.
• 🧾 Income tax expense increased from PKR 49.2 million to PKR 110 million.
• 📊 Profit after taxation increased by 29.8%, from PKR 140.5 million to PKR 182.4 million.
• ⭐ Basic and diluted earnings per share improved from PKR 3.23 to PKR 4.20.
• 📉 Stock in trade decreased from PKR 4.93 billion to PKR 4.15 billion, indicating efficient inventory management.
• 💸 Trade debts increased from PKR 2.10 billion to PKR 2.30 billion, signalling improved sales.
• 🏦 Cash and bank balances rose slightly from PKR 345.6 million to PKR 357.7 million.
• 💼 Total equity increased from PKR 9.37 billion to PKR 9.55 billion.
• ⚠️ Finance costs, although decreased, still pose a significant expense at PKR 79.9 million.
• ✅ Non-current assets showed a slight decrease from PKR 6.81 billion to PKR 6.74 billion.

🎯 Investment Thesis

Based on the improved financial performance, particularly the revenue growth, the reduction in finance costs, and the increase in earnings per share, a BUY rating is justified. A price target of PKR 500, based on a conservative P/E multiple of 12x the current EPS, seems reasonable. This is a SHORT_TERM investment horizon, anticipating continued positive performance in the coming quarters.