DYNO has reported earnings per share of PKR 45.97 in FY25 (FY24: PKR 63.14). Furthermore, in 1QFY26 the company reported EPS of PKR 10.13 (EPS 1QFY25: PKR 8.05). Exports to Afghanistan rose to 44% in FY25 to approximately PKR 1 billion. After the border closure, the export to Afghanistan is completely closed.
The company is seeking other routes and other markets for exports. The company has installed 1.4 MW Solar plant at Gadoon factory, providing significant cost-efficiencies. Furthermore, 0.4 MW Solar was added at the Hub facility. Solar contributes around 20% of the total power requirement.
The current average electricity cost turns-out to be Rs. 25-26/unit. The company denied extending “over the top” credit beyond its approved policy. However, they face a challenge in maintaining market share because competitors are extending both price competition and credit terms significantly. Due to the overall economic slowdown, some customers’ paying ability has been impacted, leading to minor credit loss and provisioning.
Delayed payments are noted as a market norm. Resin margins have substantially decreased compared to moulding margins, which remain better. This trend is expected to continue. The reduction in resin margins is attributed to the current market trend of oversupply/overproduction capacity, forcing the company to reduce margins to retain market share. Historically, margins were better when construction activity was higher.
The company typically holds up to three months of raw material inventory. The market is efficient, so the impact of methanol price changes (up or down) is quickly passed on to customers. The high risk of inventory gains or losses seen previously is now mitigated because competitors also have sufficient raw material availability, leading to prompt market price adjustments. Resin additives and PVA white glue were introduced as new product in the resin segment developed through in-house R&D. Resin additives are sold B2B, and is a niche market segment sold to existing chipboard and MDF customers. This is identified as a high margin segment.
PVA White Glue is currently focused on B2B customers for furniture applications. The launch for the retail segment is expected in the coming months pending packaging finalization. Going forward, despite the Afghanistan issue, the overall market is better than last year, and the company aims to achieve decent volumetric growth. The company is installing a turbine at its Hub plant. The capacity is still being finalized. The Levelized Tariff for the wind project is expected to be in the mid-teens range (PKR per unit), including all costs. It is expected to be online by the end of FY26. The project is expected to significantly save energy costs at the Hub plant and improve overall company profitability.
Important Disclosures
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