JS Securities Limited – JS Research (May 13, 2022)

Karachi, May 13, 2022 (PPI-OT): FFBL: Pricing power to drive earnings sustainability

FFBL has been able to enjoy lucrative primary margins of late on the back of increase in DAP prices, in-line with higher international prices, in addition to passing on the impact of rupee devaluation.
As a result, FFBL posted its highest ever 1st quarter profitability in 1QCY22, whereby its unconsolidated EPS clocked in at Rs1.26, up 28% YoY, mainly due to higher sales and better DAP margins.
Going forward, the company targets to improve its group level performance by building on the improvements across the power, banking, foods and chemicals business, while reducing exposure in loss-making businesses. A divestment strategy is already in place for Fauji Meat Limited.

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