Karachi: Engro Holdings has reported robust financial results for the first quarter of 2026, with significant revenue and profitability growth across its business units despite facing various market challenges. The company highlighted substantial increases in revenue for Engro Connect and EFERT, while also addressing the impact of geopolitical tensions in the Middle East on its operations.
According to JS Global, Engro Connect achieved a revenue of Rs19 billion, marking a 3.8-fold increase year-on-year (YoY). This growth was attributed to an increase in site count to 15,331, with profitability rising to Rs2.1 billion, a 3.5-fold increase YoY. The management noted that the rise in profitability included statutory adjustments related to long-term leases.
EFERT, another subsidiary of Engro Holdings, reported a 27% YoY increase in sales to Rs38 billion, with profitability up by 14% YoY to Rs3.3 billion. The growth was primarily driven by higher urea and DAP offtake, improved farmer economics, and better water availability. However, the company anticipates pressure from rising input costs, particularly DAP prices.
Engro Polymer and Chemicals Limited (EPCL) saw its revenue rise to Rs22 billion due to higher volumes and improved cost efficiencies, despite an increased gas levy. The company recorded its highest-ever sales for hydrogen peroxide. Nevertheless, it warned of potential volatility in its core delta due to the Middle East crisis.
Engro Vopak experienced a decline in LNG market share due to lower shipments, with revenues and profitability falling to Rs5.4 billion and Rs0.8 billion, respectively. The company attributed this to LNG cargo delivery disruptions and an increased minimum tax rate.
Engro Eximp FZE reported a 24% YoY growth in US dollar revenues to $125 million, driven by higher volumes and an expanded third-party footprint. Despite potential supply-side disruptions due to the Middle East situation, the company has managed to capitalize on alternative routes and margin opportunities.
Lastly, FrieslandCampina Engro Pakistan Limited (FCEPL) saw a 12% YoY increase in topline to Rs29 billion, with profit rising by 68% YoY to Rs1.85 billion. The company attributed this to improved value-added product profitability and cost-saving initiatives, despite ongoing financial strain due to sales tax on packaged milk.
Engro Holdings is currently trading at a price-to-earnings ratio of 8.3x for 2026E and 6.6x for 2027F.
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