Karachi: Fauji Cement Company Ltd. (FCCL) has reported a significant rise in its profitability for the first quarter of fiscal year 2027, with earnings increasing by 51% to PkR5.0 billion, or PkR2.0 per share, compared to PkR3.3 billion, or PkR1.3 per share, in the same period last year.

According to AKD Securities Limited, the growth in FCCL's earnings was driven by higher domestic offtakes, increased retention prices, and a decline in finance costs. Revenue for the quarter rose by 11% year-over-year to PkR26.0 billion, up from PkR23.4 billion in the same period last year. This increase was primarily due to a 17% year-over-year rise in local offtakes and an 11% year-over-year increase in retention prices, despite the absence of exports.

Gross margins for FCCL expanded by 4.4 percentage points year-over-year, reaching 35.9% from 31.5% in the previous year. AKD Securities Limited maintains a 'BUY' stance on FCCL, with a target price of PkR88 per share by December 2026. The outlook is supported by a recovery in demand with the revival of construction activity, optimized energy mix supporting gross margins, and anticipated easing of finance costs amid expected relief in policy rates.