KARACHI, Dec 15: Indus Motor Company reported 27 per cent growth in its 1QFY06 profit after-tax (PAT) of Rs466 million, compared to Rs368 million earned in the same quarter last year. In an analysis of 1QFY06 accounts issued on Thursday by stock brokerage firm First Capital Equities Limited, analysts noted that sales of the company grew by 9 per cent to Rs7.1bn for 1QFY06 against Rs6.5bn for the same time the previous year. The company has current capacity to produce 37,000 units per annum and it plans to enhance capacity to 50,000 units per annum by the end of current fiscal.
Overall increase in top line had come from the trading revenue that grew by 150pc on Y-o-Y basis for the period under review.
In another report released late last week by brokerage firm InvestCap, analysts mentioned that coming on the heals of a decline in world steel prices, increase in production capacities and sharp rise in trading incomes due to CBU imports, another factor that may improve car assemblers’ profits was the recent weakening of Japanese yen against the Pak Rupee.
“During the last couple of months, Japanese yen has continuously depreciated against the world currencies including Pak Rupee”, analysts said.
First Capital Securities concluded that the demand for auto industry remained strong on the back of rapid economic growth. However, local assemblers were faced with a growing threat from imported cars through reduction in import duties. Indus Motor was said to have started the import of Toyota Camry and other CBUs to get advantage of lower duties while retaining as well as trying to increase its market share to redeem its profitability.
