Karachi: Indus Motor Company (INDU) convened its 37th Annual General Meeting today, addressing its future in electric and plug-in hybrid vehicle technology amidst broader financial challenges. The meeting followed the release of the company’s Fiscal Year 2026 results, highlighting strategic shifts and market dynamics.

According to JS Global, management reaffirmed that while Toyota has released models with the latest EV/PHEV technology globally, Indus Motor will adjust its launch strategy in alignment with the government's finalized auto policy. Additionally, the company reported a decline in gross margins to 10.3% for the fourth quarter of FY26, down from 13.3% in the previous year, attributing this to strategic pricing decisions and increased dealer incentives aimed at bolstering marketing efforts.

The company is planning capital expenditures of Rs4-5 billion in FY27 to enhance the localization of parts and components. Management also cited increased inventory levels as a response to shipment delays caused by geopolitical tensions, aiming to prevent production disruptions.

Sales of the Hilux model saw a decline in FY26, primarily due to reduced government procurement amid ongoing conflict. Management raised concerns over competitors allegedly mis-declaring products under the REEV category to gain lower GST rates, a matter currently under regulatory review, which is expected to ensure fair competition.

JS Global maintains a BUY recommendation on Indus Motor, noting the company's trading at an estimated PE ratio of 4.8x for FY27 and a dividend yield of 13%.