THALL reports 23% decline in revenue for 9 months of FY24

Thal Limited (THALL) recently announced a significant drop in revenue for the first nine months of FY24, reflecting challenges across multiple business segments.

Financial Performance

During the 9MFY24 period, the Company reported an unconsolidated topline of approximately PKR 19.1 billion, marking a 23% decrease year-on-year. This decline is attributed to

• reduced car sales
• lower demand in exports and wheat bag volumes
• slowdown in construction and real estate activity.

How are the business segments performing?

Thal Engineering

Thal Engineering saw notable activities in the 9MFY24 period:

• Sold a total of 518 harnesses to various car manufacturers.
• Secured contracts to supply products for new car variants, including Toyota Cross, Hyundai Santa Fe, Hyundai Tucson, and Honda HRV.
• Expanded aftermarket sales network with five new dealerships, bringing the total to 12 across Pakistan.
• Thal Boshoku Pakistan Limited started providing leather seats for the Toyota Corolla Cross and fabric seats for the Toyota Yaris.
• Secured contracts for comprehensive wiring of Toyota Cross, Hyundai Santa Fe, Hyundai Tucson, and Honda HRV.

Jute Division

The Jute division experienced significant growth:

• Sales quantity reached 21k MT, up 77% YoY.
• Product mix ratio: 70% sacking, 23% hessian, 7% others.
• Achieved 46% market share in the Jute market.
• Exported 3,106 tons of Jute, holding a 72% market share in total Jute exports.

Thal Packaging

The Packaging division reported growth in volumetric sales for paper and polypropylene bags, with key export markets in the Middle East, Africa, USA, and Europe. Additionally, the Company became Pakistan’s first to sell non-textile products to IKEA.

Thal Laminates

The Laminates division expanded its market reach to four countries in the Middle East and Africa. The Company increased its reliance on local raw materials to reduce costs.

Investments and Dividends

The Company holds an 11.36% ownership in SECMC and received approximately PKR 1 billion in dividends in 9MFY24. Additionally, a dividend of approximately PKR 1.14 was received from Habib Metro Pakistan Private Limited.

Renewable Energy Initiatives

The total installed capacity for solar energy is 6.21MW, resulting in cost savings of up to 50%.

What are the management plans in the near future?

The Management has outlined several future initiatives:

• Plans to acquire HBL’s holding in SECMC.
• Phase 3 of SECMC is expected to be completed in 2HFY25.
• Working on diversification, including engagement with KE Electric to supply tailored products, with one product currently undergoing field testing.