Revenue Growth Analysis

The analysis shows that business performance in terms of revenue growth was better
when we compare it to the Largest IPP HUBCO and industry average over the period of
2016-2019. In 2016 the revenue growth was worse than industry average but it keeps
on getting better as we move along from 2017 to 2019.
Nishat PL HubCo Industry
2016 -37.72 -34.27 -30.29
2017 8.24 -9.06 13.05
2018 12.55 -2.44 -11.49
2019 -7.96 -53.01 -15.58

Sales Growth Chart

20
10
0
-10
-20
-30 Nishat PL
-40 HubCo
-50 Industry
-60
Profitability Analysis

The profitability analysis for Nishat Power Ltd shows that in majority ratios of profitability
company has performed better than industry average.

 Gross Margin ratio for trailing twelve month is almost double than industry
average. Same can be seen from gross margin average for last five years
showing that business is able to exhibit efficient control over its cost of sales.
 Same can be seen from operating margin either based on trailing twelve month
and five years average that company is efficiently controlling its operating costs
as compared to industry
 But in so for as return on equity and return on capital employed is considered
business is not performing that efficiently. Its ROE (Trailing Twelve Month) is
almost 8% less than industry average indicating that business is less efficient in
applying the resources provided by shareholders. But Average ROE over the five
year is same as industry Average.
Nishat Power Industry
Limited Average
Gross margin TTM (Trailing Twelve Month) 45.7% 22.57%
Gross Margin 5YA(five Years Average) 25.88% 13.24%
Operating margin TTM 34.33% 16.95%
Operating margin 5YA 18.9% 11.33%
Pretax margin TTM Chart Title 34.33% 12.65%
Pretax margin 5YA
50.00% 18.9% 5.61%
Net Profit margin TTM
45.00% 34.33% 15.1%
40.00%
Net Profit margin 5YA
35.00%
18.91% 6.03%
Return
30.00% on Equity TTM 22.36% 30.58%
Return
25.00% on Equity 5YA 22.98% 22.74%
20.00%
15.00%
10.00%
5.00%
0.00%
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Nishat Power Ltd Industry Average

Comparison with HUBCO

HUBCO is considered as one of the largest power production business in Pakistan.

When we compare Last five years performance of Nishat with HUBCO following
conclusions can be withdrawn.

 GPM od Nishat Power Ltd is high as compared to HUBCO from 2015 to 2018
showing more efficient control on cost of sales even though HUBC being a bigger
business have benefits of economies of scale. In 2019 HUBCO have slightly
greater GPM than Nishat Power Ltd.

Gross Profi t Margin

35 Hubco Nishat

30

25

20

15

10

0
2015 2016 2017 2018 2019

 Net Profit Margin also exhibiting the same pattern as Gross profit Margin showing competitive
control of Nishat Power Ltd over its operating and finance costs even though being smaller in
size
 Net Profi t Margin
30

Hubco Nishat
25

20

15

10

0
2015 2016 2017 2018 2019

 Return on Equity and return on capital employed of Nishat Power Ltd is much less than HUBCO
and the difference is increasing from 2015 to 2019 with the largest gap in FY 2018. This shows
Nishat have not employed the equity resources as efficiently as HUBCO, this might be due the
much larger size of HUBCO.

Return on Equity
50

45

40

35

30

25

20

15

10

0 Hubco Nishat
2015 2016 2017 2018 2019
 Return on Capital Employed
40

35

30

25

20

15

10

0
2015 2016 2017 2018 2019

Hubco Nishat

2015 2016 2017 2018 2019

Hubco Nisha Hubco Nisha Hubco Nisha Hubco Nishat Hubc Nishat
t t t o
Gross Profit
10.94 21.03 17.11 27.97 11.86 25.75 12.87 24.94 32.57 32.07
Margin
net profit
7.49 13.97 13.40 20.52 10.50 19.15 11.17 18.97 22.31 24.19
margin
operating
cost to 89.06 79.77 82.89 73.49 88.14 76.00 87.22 76.97 67.43 69.79
turnover
Return on
31.44 26.84 39.10 23.27 35.08 20.77 43.57 19.58 30.86 19.73
equity
Return on
Capital 26.76 28.69 28.85 24.18 26.82 22.23 35.71 21.54 29.42 21.28
Employed