Karachi, April 28, 2022 (PPI-OT): LUCK: 3QFY22 unconsolidated EPS clocked in at PkR17.12 – Higher than expectation

Lucky Cement Ltd. (LUCK) announced its result for 3QFY22 where company announced unconsolidated PAT of PkR5.5bn (EPS: PkR17.12), up 122%YoY while declining by 23% on YoY basis. For 9MFY22, company announced unconsolidated PAT of PkR11.7bn (EPS: PkR36.14).

The result was above our expectation on account of higher other income where company recorded PkR4.1bn against our expectation of PkR1.3bn mainly due to a dividend of PkR1.1bn from Lucky Motors while company also recorded a PkR1.5bn fee for provision of technical services.

Revenue for 3QFY22 stood at PkR21.3bn, up 25/3% YoY/QoQ despite decline in local dispatches as export sales provided support while increase in prices also mitigated the impact. For 9MFY22, unconsolidated revenue stood at PkR47.1bn.

Gross margins for 3QFY22 stood at 22% against our expectation of 23%. On sequential basis, they declined by 1ppts where delayed pass on of increasing energy prices imparted its impact while on YoY basis, gross margins slipped by 14ppts.

Company also apprised on ongoing projects where brownfield expansion in North is on track to be commissioned in Dec’22 and more than half of materials related to civil, mechanical and electrical works has been delivered on site.

We have a Buy stance on the stock with a TP of PkR1021.6/sh.