Karachi: Dewan Automotive Engineering Limited has released its un-audited financial statements for the first quarter ending September 30, 2024. The Pakistan-based automobile manufacturer reports a continued struggle with losses as the industry grapples with economic and political uncertainties.
The company, in its latest directors' report, outlines a challenging fiscal year 2023-24 for Pakistan's automobile sector, marked by reduced vehicle sales and supply chain disruptions. These disruptions have led to plant closures and workforce reductions. With a shift in consumer spending towards essential goods, the demand for automobiles has significantly decreased. The sector has also faced rising costs due to rapid changes in consumer preferences, technological advancements, and stricter regulatory requirements.
Despite these adversities, there are signs of resilience within the industry. According to information available from the Pakistan Stock Exchange (PSX), easing import restrictions and improved foreign exchange reserves—partly due to the International Monetary Fund's (IMF) Stand-by Agreement—have supported industrial activity. This backdrop suggests a potential upturn in sales and production across the automotive supply chain in the coming months.
For Dewan Automotive, the first quarter of 2024 saw no sales activity, with the company reporting a gross loss of Rs. 3.30 million, slightly better than the Rs. 3.48 million loss during the same period last year. The net loss after taxation stood at Rs. 11.85 million, an improvement from the previous year's Rs. 20.05 million. The company's production was halted during the quarter; however, there is an ongoing effort to resume operations. The management is seeking working capital, buoyed by the restart of vehicle assembly operations by a sister concern, previously a major customer.
The directors concluded their report with a prayer for blessings, guidance, and prosperity, reflecting hope for stability and growth in the future, not just for the company but for the nation and the broader Muslim community.