PSX companies post record profit

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KARACHI:

Companies listed on the benchmark KSE-100 of the Pakistan Stock Exchange (PSX) posted a record profit of Rs 875 billion in the fiscal year ending June 30, 2021 due to government policies favorable to the growth and business and low interest rates during the year. .

“Profits rose 56% to a record 875 billion rupees in FY21, from 562 billion rupees in FY21,” Chief Research Officer Tahir Abbas said Tuesday. , Arif Habib Limited, in a report. “Overall, a sharp turnaround in domestic demand has helped cyclical sectors post an impressive rebound in profitability, with some segments posting healthy profits from losses last year.”

The brokerage’s report is based on the analysis of companies in the KSE-100 index. It included the financial results of 83 companies while the remaining 17 companies in the index have yet to release their results. The companies that were included in the analysis represent almost 89% of the market capitalization of KSE-100.

The rise in profits in FY21 was fueled by cyclical sectors, with the cement sector posting profits of Rs 40.6 billion against losses of Rs 2 billion in the previous year and oil marketing companies (OMC) posting profits of 39.3 billion rupees against losses of 13 Rs. 4 billion.

Auto assemblers posted a fivefold increase in profits in FY21 compared to FY20, fertilizer industry profits grew 92% over the year, banks by 18%, chemicals by 130%, electricity by 22%, textile composites by 97% and tobacco sector revenues jumped by 36%.

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On the flip side, insurance company profits in FY21 declined a meager 3% year-on-year.

Sectors leading the growth in profitability are textile spinning, cables and electrical products, automotive assemblers, technology and communication, and sugar.

In the same year, the benchmark KSE-100 rose 37.6% (or 12,934 points), the analyst said in the report.

The technological sector holds the strongest contribution to growth (2,489 points in the benchmark index) followed by cement (2,064 points), banks (2,059 points), fertilizers (842 points), composite textiles (768 points) ), electricity (670 points) and automotive assemblers (667 points).

In addition, the food (598 points), oil marketing companies (377 points), oil and gas exploration companies (361 points) and chemicals (360 points) also contributed substantially to the rise.

However, the tobacco sector erased 60 points from the index followed by various which were relieved of 52 additional points during the year under review.

4QFY21 earnings

Profits of companies listed on the KSE-100 index represented a healthy trend for another quarter and increased the benchmark by 67% on an annual basis compared to the same quarter last year when industries were operating. under the lock.

The main contributors to growth during the quarter were petroleum marketing companies (OMCs), cement, automotive assemblers, fertilizers, oil and gas exploration companies, chemicals, textile composites and technology and communication.

By comparison, commercial bank profits remained flat in the quarter compared to the same quarter last year, while the net results of refineries and power generation declined.

Posted in The Express Tribune, September 29e, 2021.

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