Sazgar Engineering Works Limited (SAZEW) announced its financial results for 9MFY26 earnings which stood at Rs. 14,879 million (EPS: Rs. 246.2), up 16 percent YoY after reporting its highest-ever quarterly profit after tax (PAT) of Rs. 6,438 million for 3QFY26.
The company declared a cash dividend of Rs. 20.0 per share for 3QFY26, bringing the total payout to Rs. 50.0 per share for 9MFY26.
For 9MFY26, revenue reached Rs. 115,202 million, up 41 percent YoY.
Net revenue for 3QFY26 stood at Rs. 47,356 million, reflecting a 29 percent YoY increase. According to Arif Habib Limited (AHL), this was driven by a sharp rise in Haval volumes, which reached 5,420 units (+47 percent YoY).
On a 9MFY26 basis, gross margins declined to 25.6 percent from 30.5 percent in 9MFY25. In 3QFY26, gross margins stood at 26.8 percent compared to 32.6 percent in the same period last year. The decline was mainly due to the removal of concessionary duties, the impact of Pakistani rupee depreciation, and a shift in product mix toward a higher share of petrol variants.
Distribution expenses increased 62 percent YoY to Rs. 4,171 million in 9MFY26. In 3QFY26, distribution expenses also rose 62 percent YoY, driven by higher deliveries following increased volumes.
Other income in 3QFY26 stood at Rs. 761 million, up 155 percent YoY, supported by higher cash and cash equivalents.
Finance cost in 3QFY26 amounted to Rs. 102 million, up 98 percent YoY. For 9MFY26, finance cost increased 50 percent YoY to Rs. 301 million.
The effective tax rate for 3QFY26 came in at 39.1 percent, broadly in line with 39.0 percent for 9MFY26, compared to 38.9 percent in 9MFY25.
AHL maintains a BUY stance on SAZEW with a December 2026 target price of Rs. 2,670. The stock is currently trading at FY26/FY27 price-to-earnings (P/E) multiples of 6.7x and 5.9x, respectively.