{"id":10594,"date":"2025-07-28T10:50:35","date_gmt":"2025-07-28T05:50:35","guid":{"rendered":"https:\/\/ksestocks.com\/blog\/?p=10594"},"modified":"2025-07-28T10:50:37","modified_gmt":"2025-07-28T05:50:37","slug":"isl-earnings-preview-volumes-improve-but-price-cuts-hurt-profits","status":"publish","type":"post","link":"https:\/\/ksestocks.com\/blog\/isl-earnings-preview-volumes-improve-but-price-cuts-hurt-profits\/","title":{"rendered":"ISL earnings preview: volumes improve, but price cuts hurt profits"},"content":{"rendered":"\n

International Steels Limited (ISL<\/a>) <\/strong>is expected to post mixed financial results for the April\u2013June 2025 quarter (4QFY25). While sales volumes have picked up, falling steel prices and competition from cheaper imports have put pressure on profits.<\/p>\n\n\n\n

What to expect this quarter?<\/h2>\n\n\n\n
    \n
  • Earnings per share (EPS)<\/strong> for the quarter are expected at Rs0.88<\/strong>, down 36% from last year<\/strong>, and 8% lower than the previous quarter<\/strong>.<\/li>\n\n\n\n
  • Sales<\/strong> are expected to come in at Rs14.1 billion<\/strong>, up 6% YoY<\/strong> and 1.5% QoQ<\/strong>.<\/li>\n\n\n\n
  • Profit after tax<\/strong> is projected at Rs382 million<\/strong>, down sharply from Rs595 million<\/strong> last year.<\/li>\n<\/ul>\n\n\n\n

    What\u2019s driving these numbers?<\/h2>\n\n\n\n
      \n
    1. Higher Volumes, But Lower Prices:<\/strong>
      ISL sold more steel this quarter, thanks to some recovery in demand from industries like auto manufacturing. However, this gain was mostly offset by a big drop in local cold-rolled coil (CRC) prices, down 8% YoY<\/strong>.<\/li>\n\n\n\n
    2. Import Pressure:<\/strong>
      The company had to cut prices by Rs15,000\/ton<\/strong> in March to compete with cheaper imported steel, especially Galvalume coils, which are entering the market through duty loopholes<\/strong>. This added pricing pressure trimmed gross margins by 60 basis points (bps)<\/strong>.<\/li>\n\n\n\n
    3. Margins Under Pressure:<\/strong>\n
        \n
      • Gross margin<\/strong> is expected at 9.2%<\/strong>, down from 10.1% last year<\/strong>.<\/li>\n\n\n\n
      • Net margin<\/strong> is also squeezed, at just 2.8%<\/strong> vs 4.5%<\/strong> in 4QFY24.<\/li>\n<\/ul>\n<\/li>\n\n\n\n
      • Finance Costs Improve:<\/strong>
        On the bright side, ISL\u2019s finance costs dropped by 43% YoY<\/strong>, thanks to lower debt and falling interest rates. This helped cushion some of the pressure on profits.<\/li>\n<\/ol>\n\n\n\n

        What it means for investors?<\/h2>\n\n\n\n

        ISL\u2019s performance shows that volume recovery alone isn\u2019t enough<\/strong>, price competition, especially from imports, is still a big hurdle. The company\u2019s efforts to manage costs and reduce debt are positive, but earnings remain under pressure until pricing power returns.<\/p>\n\n\n\n

        FY25 snapshot<\/h2>\n\n\n\n
          \n
        • Full-year EPS<\/strong> expected at Rs3.06<\/strong>, reflecting the tough environment in the flat steel market.<\/li>\n\n\n\n
        • While topline growth is steady, margins remain thin<\/strong>, and ISL may need to focus on policy support (like anti-dumping enforcement) and higher-value products to protect profits in FY26.<\/li>\n<\/ul>\n\n\n\n

          ISL is growing sales, but shrinking margins are a concern.<\/strong> Until pricing pressure eases or import duties are tightened, earnings may remain soft. Long-term investors should watch how ISL navigates competitive imports and rising costs.<\/p>\n\n\n\n

          Source: Ismail Iqbal Securities (Pvt.) Limited<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

          International Steels Limited (ISL) is expected to post mixed financial results for the April\u2013June 2025 quarter (4QFY25). While sales volumes have picked up, falling steel prices and competition from cheaper imports have put pressure on profits.<\/p>\n","protected":false},"author":9252,"featured_media":6796,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[154,138],"tags":[180],"class_list":["post-10594","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-analysis","category-financials","tag-isl"],"featured_image_src":{"landsacpe":["https:\/\/ksestocks.com\/blog\/wp-content\/uploads\/2024\/11\/ISL-STOCK-PSX-1140x445.png",1140,445,true],"list":["https:\/\/ksestocks.com\/blog\/wp-content\/uploads\/2024\/11\/ISL-STOCK-PSX-463x348.png",463,348,true],"medium":["https:\/\/ksestocks.com\/blog\/wp-content\/uploads\/2024\/11\/ISL-STOCK-PSX-300x188.png",300,188,true],"full":["https:\/\/ksestocks.com\/blog\/wp-content\/uploads\/2024\/11\/ISL-STOCK-PSX.png",1920,1200,false]},"_links":{"self":[{"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/posts\/10594","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/users\/9252"}],"replies":[{"embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/comments?post=10594"}],"version-history":[{"count":1,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/posts\/10594\/revisions"}],"predecessor-version":[{"id":10595,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/posts\/10594\/revisions\/10595"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/media\/6796"}],"wp:attachment":[{"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/media?parent=10594"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/categories?post=10594"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/tags?post=10594"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}