Cherat Packaging Limited (CPPL) reported earnings per share of PKR 13.26 for FY26, compared to earnings per share of PKR 7.26 in FY25. Furthermore, in 4QFY26, the company reported earnings per share of PKR 10.92, compared to loss per share of PKR 0.84 in the same period last year (SPLY). The company operates through its Polypropylene Bags segment and the SOS paper carrier bag division.
The company also operates a Flexible Packaging Division, which includes high barrier extrusion, flexographic, and rotogravure printing capabilities. Management has improved working capital controls, reducing the operating cycle to approximately 50 days. Commissioning of the 2nd extrusion line commenced in June. The company’s solar capacity reached 3.7MW after the addition of the 2.7MW plant.
Currently, 47% of the company’s energy requirement is generated from renewable sources, while the remaining 53% is sourced from the conventional utility(grid). Regarding raw materials management commented that, around 55% are imported while 45% are locally sourced. To mitigate supply risks from the Middle East, the company has qualified and engaged alternative global supply markets. The fourth quarter delivered exceptionally strong profitability. However, treating Q4 as a forward run rate would be overly optimistic.
Management expects top line growth to remain above the FY26 average run rate. Growth is expected to be supported by commercial volumes from the newly commissioned barrier film line and the scaling up of the SOS paper bag division. Raw material cost pass through remains subject to prevailing competitive dynamics and market conditions. While CPPL successfully passed on cost increases in recent quarters, pricing adjustments vary from quarter to quarter depending on competitor pricing.
Important Disclosures
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