External broker reports(aggregated public sources), Topline Securities

Topline Securities

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External broker reports(aggregated public sources)

Equity Bottom-Up

Pak Elektron Limited (Pael) / Equity Bottom-Up

<ul><li>We revise down our 2026E and 2027F earnings expectations for Pak Elektron (PAEL) by 44% and 27% to Rs4.7 and Rs6.2 per share from earlier expectations of Rs6.8 and 7.9 per share, respectively on the back of (1) lower than expected gross profit (GP) margins expectations for 2026 and 2027 and lower sales of power segment, and (2) likely increase in finance cost post increase in interest rates in last MPC policy.</li><li>Resultantly, we also revised down our Jun 2027 target price for PAEL to Rs55/share (earlier Rs81/share), albeit maintaining BUY stance on the company as it offers potential upside of 40%.</li><li>Gross margins assumptions revised down: We revised down our expectations of GP margins to 26.6% and 26% for 2026E and 2027F vs. earlier 28% for both, respectively.</li></ul>

We revise down our 2026E and 2027F earnings expectations for Pak Elektron (PAEL) by 44% and 27% to Rs4.7 and Rs6.2 per share from earlier expectations of Rs6.8 and 7.9 per share, respectively on the back of (1) lower than expected gross profit (GP) margins expectations for 2026 and 2027 and lower sales of power segment, and (2) likely increase in finance cost post increase in interest rates in last MPC policy.Resultantly, we also revised down our Jun 2027 target price for PAEL to Rs55/share (earlier Rs81/share), albeit maintaining BUY stance on the company as it offers potential upside of 40%.Gross margins assumptions revised down: We revised down our expectations of GP margins to 26.6% and 26% for 2026E and 2027F vs. earlier 28% for both, respectively.

Pak Elektron (PAEL): BUY Stance Maintained; Earnings Revised Down