⚡ Flash Summary

GAMMON Pakistan Limited’s unaudited financial results for Q1 2026 (ended September 30, 2025) reveal a challenging period. The company experienced a significant net contract loss of PKR 218,070 compared to no contract income in the same period last year. This, coupled with operating expenses, led to an operating loss of PKR 5,327,877. The company reported a loss after tax of PKR 5,649,083, translating to a negative earnings per share (EPS) of PKR (0.20).

📌 Key Takeaways

• 📉 Net contract loss of PKR 218,070 compared to zero income in Q1 2025.
• 📉 Operating loss of PKR 5,327,877 against an operating profit of PKR 1,807,029 in Q1 2025.
• ⚠️ Loss after tax deepened to PKR 5,649,083 from a profit of PKR 1,333,920 in the corresponding period.
• 🔻 Negative earnings per share (EPS) of PKR (0.20) compared to a positive EPS of PKR 0.05 in Q1 2025.
• ❌ Total Assets decreased slightly from PKR 996,860,538 to PKR 991,122,637.
• 🔻 Revenue reserve declined from PKR 376,040,627 to PKR 370,629,012.
• 🔻 Accumulated profit decreased from PKR 376,040,627 to PKR 370,629,012.
• 💰 Cash and bank balances decreased slightly from PKR 1,946,260 to PKR 1,835,851.
• 🚧 Current liabilities remained relatively stable at around PKR 197 million.
• 👍 Share capital remained unchanged at PKR 282,662,310.
• 👍 Share premium reserve stayed constant at PKR 15,380,330.
• 👍 Long-term investments held steady at PKR 189,340,000.
• 👍 Long term security deposits remain stable at PKR 1,350,600

🎯 Investment Thesis

Based on the current financial performance, a SELL recommendation is warranted. The company’s transition to a net contract loss, coupled with increasing operating expenses and a significant loss after tax, indicates substantial challenges. The price target rationale is based on the expectation of continued losses and the absence of clear turnaround strategies. A price target revision would be necessary upon evidence of improved profitability and operational efficiency.