Summary The board of directors has approved an amount of Rs 3.3 billion for capital expenditure.
LAHORE (Dunya News) - Indus Motors profit in the year ended June 30, 2018 increased by 21 percent on higher sales volume while the company also plans to boost annual capacity by 11000 units.
The company is making efforts to reduce lead time of vehicles through various measures including debottlenecking of plant, improving production efficiency and working beyond normal working hours, the company said in a statement of Pakistan Stock Exchange on Tuesday.
The board of directors has approved an amount of Rs 3.3 billion for capital expenditure to increase the manufacturing productivity, which will enhance the annual production to 76000 units from 65000 units per annum.
Indus Motor net profit for the year ended June 30, 2018 amounted to Rs 15.771 billion with earning per share stood around RS 200.66 as compared with Rs 13 billion or earning per share of Rs 165.41 of the same period preceding year, the statement said.
The company announced a final cash dividend of Rs 45 per share or 450 percent. This is in addition to the combined interim dividend of 950 percent or Rs 95 per share announced earlier, paid in three installments of 300 percent, 325 percent and 325 percent respectively.
Ahmed Lakhani research analyst from JS Global said that growth in earnings during the period was due to stronger volumes and higher proportion of premium variants. Probably owing to higher ratio of Fortuner sales, gross margins were higher than expectations at 17 percent, largely countering the negative impact of rupee depreciation against the US dollar, where its other two competitors had witnessed a steep decline in margins by comparison.
“We flag, 1) unfavorable movement in exchange rate & commodity prices 2) regulatory changes 3) increased competition from existing and new players, and 4) disruptions in operations of principal company as key risks for the company”, Danyal Adil analyst from Topline Securities elaborated.
