⚡ Flash Summary

Millat Tractors Limited’s (MTL) unconsolidated financial results for the quarter ended September 30, 2025, reveal a concerning trend. The company experienced a decline in revenue compared to the same period last year, alongside a decrease in profitability. This contraction is evident in both the standalone and consolidated figures, signaling potential headwinds for the tractor manufacturer. Further investigation into the drivers of decreased sales and increased costs is warranted to assess the long-term impact.

📌 Key Takeaways

• 📉 Revenue decreased to PKR 7.546 billion (unconsolidated) from PKR 7.996 billion in Q3 2024.
• 📉 Consolidated revenue declined to PKR 7.784 billion from PKR 8.792 billion year over year.
• 📉 Gross profit unconsolidated decreased to PKR 2.053 billion from PKR 2.326 billion.
• 📉 Gross profit consolidated decreased to PKR 2.191 billion from PKR 2.390 billion year over year.
• ⚠️ Finance costs unconsolidated decreased slightly to PKR 471.386 million from PKR 628.058 million.
• ⚠️ Finance costs consolidated decreased slightly to PKR 476.847 million from PKR 641.812 million.
• 📉 Profit after tax unconsolidated decreased to PKR 513.589 million from PKR 622.329 million in Q3 2024.
• 📉 Consolidated profit after tax decreased to PKR 613.455 million from PKR 459.805 million.
• 📉 Unconsolidated EPS decreased to PKR 2.57 from a restated PKR 3.12.
• 📉 Consolidated EPS decreased to PKR 3.07 from PKR 2.30 in Q3 2024.
• 💰 Unconsolidated cash and bank balances increased to PKR 1.368 billion from PKR 1.565 billion
• 💰 Consolidated cash and bank balances decreased to PKR 1.603 billion from PKR 1.826 billion
• ⚠️ Unconsolidated trade debts decreased to PKR 244.818 million from PKR 134.216 million
• ⚠️ Consolidated trade debts decreased to PKR 920.583 million from PKR 152.553 million
• ⚖️ Total equity unconsolidated increased to PKR 9.884 billion from PKR 9.278 billion.
• ⚠️ Total equity consolidated increased to PKR 8.621 billion from PKR 8.076 billion.

🎯 Investment Thesis

Based on the Q3 2025 financial results and trends, a SELL recommendation is warranted for Millat Tractors. The company’s declining revenue, squeezed profit margins, negative cash flow from operations, and increasing trade debts raise serious concerns. The price target rationale is described below. The investment horizon is medium-term (6-12 months).