Indus Motors is expected to close FY25 on a high with Toyota Yaris leading the Charge

Indus Motors Company (INDU), the local assembler of Toyota vehicles in Pakistan, is expected to wrap up FY25 on a solid note, with estimated profits of Rs97.3 per share for the last quarter (April–June 2025). That’s a strong 34% jump compared to last year and 20% higher than the previous quarter.

So, what’s driving this impressive rebound?

Key drivers behind the growth

1. Toyota Yaris Facelift Success
   The newly launched Toyota Yaris facelift has received a warm welcome, especially in the entry-level sedan category. Its success has significantly boosted sales volumes in 4QFY25, helping Indus Motors regain momentum in a competitive market.
2. Easier Car Financing
   Lower interest rates and more flexible financing schemes made car loans more affordable for customers this year, encouraging more people to step into a new Toyota.
3. PKR Stability Brings Cost Relief
   Unlike previous years where a falling rupee made imported car parts more expensive, the PKR remained relatively stable in recent months, helping the company keep costs in check and margins healthy.

Full-year picture: a comeback story

• FY25 earnings are projected at Rs308/share, a big jump from previous years.
• Gross profit margins for the quarter improved to 14.1%, thanks to better cost control and pricing stability.
• The company is expected to announce a cash dividend of Rs58/share, rewarding investors for the turnaround.

This marks a significant improvement from the pandemic and post-pandemic years, where rising inflation, sky-high interest rates, and PKR volatility had crushed demand.

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What’s next?

Indus Motors is entering FY26 with strong momentum. The demand for reliable and fuel-efficient vehicles like the Yaris and Corolla remains solid. If interest rates stay low and the PKR holds steady, INDU could continue its growth path.

That said, competition in the mid-range sedan segment is heating up, especially from Chinese automakers offering aggressive pricing. Indus Motors will need to innovate and maintain quality to stay ahead.

FY25 was a comeback year for Indus Motors, thanks to strong volumes, financial stability, and a favorable market. With car sales reviving and margins improving, INDU is once again back in the fast lane.

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Dividend watchers, take note: Rs58/share could be heading your way.

Source: Foundation Securities

⚠️ This post reflects the author’s personal opinion and is for informational purposes only. It does not constitute financial advice. Investing involves risk and should be done independently. Read full disclaimer →