{"id":9334,"date":"2025-05-23T10:22:31","date_gmt":"2025-05-23T05:22:31","guid":{"rendered":"https:\/\/ksestocks.com\/blog\/?p=9334"},"modified":"2025-05-23T10:22:35","modified_gmt":"2025-05-23T05:22:35","slug":"should-you-shift-gears-on-sazew-now","status":"publish","type":"post","link":"https:\/\/ksestocks.com\/blog\/should-you-shift-gears-on-sazew-now\/","title":{"rendered":"Should you shift gears on SAZEW now?"},"content":{"rendered":"\n<h2 class=\"wp-block-heading\">Key takeaways:<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>9MFY25 revenue grew 2.4x YoY to <strong>Rs. 81.4bn<\/strong>, driven by strong HAVAL four-wheeler sales<\/li>\n\n\n\n<li>Earnings rose nearly <strong>3x YoY<\/strong> to <strong>Rs. 12.9bn (EPS: Rs. 212.7)<\/strong><\/li>\n\n\n\n<li>Gross margins improved to <strong>30.5%<\/strong>, expected to remain firm until FY26<\/li>\n\n\n\n<li>Expansion plan targets doubling daily production by Mar\u201926<\/li>\n\n\n\n<li>Rs. 11.5bn capex announced for NEV expansion, warehousing, and solar upgrades<\/li>\n<\/ul>\n\n\n\n<p><strong>Sazgar Engineering Works Ltd.<\/strong> (<strong><a href=\"https:\/\/ksestocks.com\/blog\/tag\/sazew\/\" target=\"_blank\" rel=\"noopener\" title=\"SAZEW\">SAZEW<\/a><\/strong>) has posted a solid set of numbers for the first nine months of FY25, with revenues climbing to <strong>Rs. 81.4 billion<\/strong>, a <strong>2.4x jump year-on-year<\/strong>, fueled by rising sales of four-wheelers\u2014particularly the popular HAVAL brand. In the same period, earnings came in at <strong>Rs. 12.9 billion<\/strong>, nearly <strong>tripling YoY<\/strong>, thanks to volume growth and better margins.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">HAVAL drives growth<\/h2>\n\n\n\n<p>The surge in revenue stems largely from strong four-wheeler demand, with SAZEW\u2019s HAVAL SUV lineup continuing to gain traction in the market. While April 2025 sales were dented by a 12-day road closure in Sindh and Punjab, the company remains on track to scale further.<\/p>\n\n\n\n<p>Gross margins also rose significantly to <strong>30.5%<\/strong> compared to <strong>25.8%<\/strong> in the same period last year, as scale efficiencies kicked in. Management expects margins to stay elevated at least until FY26, when the current auto policy expires.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Expansion on the horizon<\/h2>\n\n\n\n<p>SAZEW is preparing for the next phase of growth with an ambitious <strong>Rs. 11.5 billion capital expenditure<\/strong> plan. This includes:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>A new paint workshop<\/li>\n\n\n\n<li>Dedicated <strong>NEV (New Energy Vehicles)<\/strong> assembly facilities<\/li>\n\n\n\n<li>Expanded warehousing<\/li>\n\n\n\n<li>A <strong>5.7 MW solar energy system<\/strong> for cost-efficient power<\/li>\n<\/ul>\n\n\n\n<p>Production capacity for the four-wheel segment is expected to more than double from <strong>43 units\/day to 90\u2013100 units\/day<\/strong> by <strong>March 2026<\/strong>, following the completion of the expansion.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">New Energy Vehicles (NEVs) in focus<\/h2>\n\n\n\n<p>SAZEW is set to enter the NEV space with new SUV and double-cabin models, though these will fall <strong>outside the current greenfield policy<\/strong>. While there\u2019s uncertainty regarding the new NEV incentives, the company is positioning itself early in this high-potential segment.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Three-Wheeler segment &amp; exports<\/h2>\n\n\n\n<p>Although electric rickshaw sales remain soft due to their <strong>Rs. 1 million price tag<\/strong>, SAZEW continues to export its three-wheelers to <strong>Japan and Liberia<\/strong>, ensuring geographic diversification and FX inflows.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Investor Outlook<\/h2>\n\n\n\n<p>While the company is <strong>not formally under analyst coverage<\/strong>, the latest results reflect a well-run, high-growth player that\u2019s actively scaling in one of Pakistan\u2019s most dynamic automotive segments. With:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>A proven product (HAVAL)<\/li>\n\n\n\n<li>Rising volumes and margins<\/li>\n\n\n\n<li>A well-funded expansion strategy<\/li>\n\n\n\n<li>Entry into NEVs and renewable energy<\/li>\n<\/ul>\n\n\n\n<p>SAZEW presents an attractive long-term growth story for investors looking at the intersection of auto innovation, electrification, and consumer demand in Pakistan.<\/p>\n\n\n\n<p><strong>Source: AKD Securities Limited<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Sazgar Engineering Works Ltd. (SAZEW) has posted a solid set of numbers for the first nine months of FY25, with revenues climbing to Rs. 81.4 billion, a 2.4x jump year-on-year, fueled by rising sales of four-wheelers\u2014particularly the popular HAVAL brand. In the same period, earnings came in at Rs. 12.9 billion, nearly tripling YoY, thanks to volume growth and better margins.<\/p>\n","protected":false},"author":9252,"featured_media":6928,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[154,138],"tags":[63],"class_list":["post-9334","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-analysis","category-financials","tag-sazew"],"featured_image_src":{"landsacpe":["https:\/\/ksestocks.com\/blog\/wp-content\/uploads\/2024\/11\/SAZEW-STOCK-PSX-1140x445.png",1140,445,true],"list":["https:\/\/ksestocks.com\/blog\/wp-content\/uploads\/2024\/11\/SAZEW-STOCK-PSX-463x348.png",463,348,true],"medium":["https:\/\/ksestocks.com\/blog\/wp-content\/uploads\/2024\/11\/SAZEW-STOCK-PSX-300x188.png",300,188,true],"full":["https:\/\/ksestocks.com\/blog\/wp-content\/uploads\/2024\/11\/SAZEW-STOCK-PSX.png",1920,1200,false]},"_links":{"self":[{"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/posts\/9334","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=9334"}],"version-history":[{"count":1,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/posts\/9334\/revisions"}],"predecessor-version":[{"id":9335,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/posts\/9334\/revisions\/9335"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/media\/6928"}],"wp:attachment":[{"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/media?parent=9334"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/categories?post=9334"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/tags?post=9334"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}