LUCK: KIA Stonic to launch in Nov’21, Peugeot afterwards

November 4, 2021 (MLN): Lucky Motors Corporation, a subsidiary of Lucky Cement (LUCK) is all set to launch KIA Stonic in November’21, while the Peugeot cars are also in the pipeline and will be launched right after the launch of Stonic, Management of LUCK informed during its recent corporate briefing.

KIA lucky motors volumes were impacted during the period due to the shortage of semi-conductor chips. The company is expecting that the availability of semi-conductor chips would improve from 3QFY22 onwards.

Meanwhile, the production of Samsung mobile phones is also expected to come online by the end of 2021, as per briefing takeaways covered by Ismail Iqbal Securities.

In line with the future outlook, the management has also apprised the investors on the financial performance of the company.

During 1QFY22, the company posted a consolidated net profit of Rs8.86 billion, depicting an increase of 72.6% against the net profit of Rs5.13bn secured in the same period last year (SPLY).

Of Rs8.86bn, Rs6.65bn is attributable to owners of the holding company which translates into an EPS of Rs20.57 during the first quarter ended September 30, 2021, as compared to Rs13.45 in SPLY.

The increase in net profit was mainly attributable to an increase in profitability at Lucky Cement Limited on the back of higher local sales during the quarter under review.

The increase in consolidated net profit was also supported by a considerable increase in profitability of the Chemicals business due to improved sales volumes of Polyester, Pharma, and Animal Health business segments at ICI Pakistan Limited. The net profit of the Chemicals business also increased on account of a one-time unrealized accounting gain recognized on the acquisition of controlling interest in NutriCo Pakistan (Pvt) Limited amounting to PKR1.847 billion.

Meanwhile, Lucky Motor Corporation also posted growth in profitability mainly on account of growth in sales revenue; whereas, the profitability of the Company's overseas operations increased mainly due to operations of the Company's Joint Venture Greenfield cement plant in Samawah, Iraq, which achieved its COD in March 2021.

To note, the industry-wide local sales volume registered a growth of 4.1% YoY to reach 11.29 million tons during the first quarter under review. Export sales volumes showed a large decline of 43.8% YoY to reach 1.54 million tons during 1Q 2021-22 As a result the total cement sales of the industry declined by 5.6% to 12.83 million tons during 1QFY22 due to a decline in export volumes on the back of increasing coal prices and freight costs internationally, which have adversely impacted the viability of cement exports from Pakistan.

The company's local sales volumes grew by 3.7% to reach 1.73 million tons in comparison to 1.66 million tons during the same period last year, mainly due to sustained cement demand as a result of several initiatives taken by the Government to boost construction activities in the country.

Market share in North remained flattish at 12.6% as compared to SPLY, while the share in South declined to 29.6% (down 2.9ppts YoY) as the Dewan cement sales also commenced during the period.

The management also underlined that Pezu plants are currently running on furnace oil plant for power requirements. The company usually carries furnace oil inventory of 10-12 days. Line-II at Pezu Plant with an estimated capacity of 3.15mn tons is in progress. The company is targeting to achieve its CoD by Dec-22.

With regards to Lucky Electric Power (LEPCL), the management is expected to achieve its CoD by the end of Dec-21. The company would use the mix of local and imported coal during the first year, while also intending to run an entire plant on local coal from Thar in the long term.

Copyright Mettis Link News