⚡ Flash Summary

Cherat Packaging Limited’s financial results for the quarter ended September 30, 2025, reveal a mixed performance. Revenue increased slightly compared to the same period last year, but profitability declined significantly. The company reported a net profit of PKR 16.159 million, a sharp decrease from PKR 131.026 million in 2024. This decline was driven primarily by increased finance costs and reduced gross profit. The company declared no cash dividend, bonus shares, or right shares for the period.

📌 Key Takeaways

• ⬆️ Revenue increased slightly to PKR 3,368.463 million compared to PKR 3,223.026 million in Q3 2024.
• 📉 Net profit plummeted to PKR 16.159 million, a significant drop from PKR 131.026 million year-over-year.
• ⚠️ Earnings per share (EPS) declined drastically to Re. 0.33 from Rs. 2.67 in the same period last year.
• 📉 Gross profit margin decreased substantially from PKR 348.624 million to PKR 234.946 million.
• ⬆️ Finance costs surged to PKR 80.843 million, up from PKR 118.453 million, impacting profitability.
• ❌ No cash dividend was declared for the quarter.
• 📊 Operating profit decreased significantly from PKR 233.785 million to PKR 105.625 million.
• 📉 Profit before minimum tax and income tax decreased from PKR 115.332 million to PKR 24.782 million.
• ⚖️ Total Assets increased to PKR 16,610.451 million from PKR 15,623.282 million as of June 30, 2025.
• 💰 Cash generated from operations decreased to PKR 129.862 million from PKR 402.268 million.
• 💸 Net cash used in investing activities was PKR (148.447) million compared to PKR (66.941) million.
• 🏦 Long-term financing decreased to PKR 1,903.938 million from PKR 2,070.180 million as of June 30, 2025.
• 🧾 Trade and other payables increased to PKR 2,784.850 million from PKR 2,305.977 million as of June 30, 2025.

🎯 Investment Thesis

Based on the Q3 2025 results, a SELL recommendation is appropriate for Cherat Packaging. The significant decline in profitability, surge in finance costs, and drastic drop in EPS raise serious concerns about the company’s financial health and future performance. A price target of PKR 20.00 with a time horizon of 6 months is set, contingent on significant operational improvements and debt management. If the company does not return to profitability they should be re-evaluated for a stronger sell.