Pakistan Food: Soft inflation supporting margins in 1Q - By JS Research

<p></p><ul><li><span style="font-family:Arial, Helvetica, sans-serif;font-size:medium;">Based on the cumulative figures of 9 listed food companies, we review food sector&rsquo;s profitability for Mar-2025 quarter. Sales revenue for our selected companies grew by 5% YoY/ 11% QoQ while gross/ operating margins were up 2ppts/4ppt QoQ during 1QCY25, on back of soft inflation and improved product mix.</span></li></ul><ul><li><span style="font-family:Arial, Helvetica, sans-serif;font-size:medium;">Our proxy for the food sector continued to underperform the benchmark KSE100 Index CY25 TD, as the sector market capitalization is up 2.1%. NATF (expansion fueling earnings growth) and UPFL (improved payouts) outperformed the peers. Resultantly, the sector P/S and P/E multiples now stand at 1.3x and 20x based on last 4-quarter trailing sales and n...