Honda Atlas Cars (Pakistan) Limited (PSX: HCAR) has posted a 200 percent year-on-year (YoY) increase in profit for the first quarter of fiscal year 2027 (Q1 FY2027), the three-month period ended June 30, 2026, as higher vehicle sales and a one-off accounting gain boosted the automaker’s earnings.
The company’s profit after tax (PAT) stood at Rs. 2,486 million (Rs. 2.49 billion), translating into earnings per share (EPS) of Rs. 17.41. This compares with a PAT of Rs. 828 million (EPS: Rs. 5.80) in the same quarter last year. On a quarter-on-quarter (QoQ) basis, profit rose 2.5 times from Rs. 1,008 million (EPS: Rs. 7.06) in the fourth quarter of FY2026.
Key Highlights: HCAR Q1 FY2027 Results
- Profit after tax: Rs. 2,486 million — up 200% YoY and 2.5x QoQ
- Earnings per share: Rs. 17.41, compared with Rs. 5.80 a year earlier
- Net revenue: Rs. 37,202 million — up 41% YoY, broadly flat QoQ
- Vehicles sold: 7,918 units — up 43% YoY
- Gross margin: 7.7%, down from 8.6% a year earlier
- Other income: Rs. 2,090 million, lifted by a Rs. 1,590 million one-off Sindh settlement gain
- Effective tax rate: 19.4%, sharply lower than 43.3% a year earlier
Revenue Rises 41 Percent as Car Deliveries Jump
Net revenue for the quarter climbed 41 percent YoY to Rs. 37,202 million, up from Rs. 26,462 million in Q1 FY2026. Compared with the previous quarter, revenue held broadly steady against Rs. 37,300 million in Q4 FY2026.
Brokerage house Arif Habib Limited attributed the YoY growth mainly to stronger vehicle deliveries, which rose 43 percent to 7,918 units in Q1 FY2027 from 5,520 units a year earlier. Combined sales of the Honda City and Honda Civic sedans reached 6,978 units, while the HR-V and BR-V crossover lineup added 940 units. In the same quarter last year, City and Civic deliveries stood at 5,520 units and HR-V/BR-V sales totalled 366 units.
Gross Margins Slip on Product Mix
Despite the jump in sales volumes, Honda Atlas Cars Pakistan’s gross margin narrowed to 7.7 percent in Q1 FY2027 from 8.6 percent a year earlier. The company attributed the decline to a less favourable product mix, as the relatively lower-margin Honda City accounted for a bigger share of total sales than the higher-margin Civic.
On a sequential basis, gross margins actually improved slightly, edging up from 7.5 percent in Q4 FY2026.
One-Off Sindh Settlement Lifts Other Income
Other income surged 3.8 times YoY to Rs. 2,090 million, up from Rs. 553 million in Q1 FY2026, and climbed 2.4 times from Rs. 890 million in the preceding quarter.
Much of this increase came from a one-time gain of Rs. 1,590 million, booked after Honda Atlas Cars Pakistan reached a settlement with the Government of Sindh over its Sindh Infrastructure Development Cess (SIDC) liability. Under the agreement, the long-term portion of the liability was remeasured at its present value using an 11.5 percent discount rate, with the resulting difference recorded as other income.
Finance Costs Higher YoY, but Easing from Q4
Finance costs more than tripled YoY, rising to Rs. 631 million from Rs. 203 million in Q1 FY2026. However, costs eased 33 percent from Rs. 936 million in the preceding quarter, which the company linked to lower borrowing costs and a shift of some non-current liabilities into the current portion.
Lower Tax Rate Adds to Bottom Line
The effective tax rate for the quarter came in at 19.4 percent, well below the 43.3 percent recorded in Q1 FY2026 and the 22.6 percent seen in Q4 FY2026, providing further support to the quarter’s profit growth.
Outlook for FY2027
The results follow a corporate briefing session held on July 28, a day before the earnings announcement. According to a note from brokerage house Chase Securities, Honda Atlas Cars Pakistan’s management guided for volume growth of around 25 percent for the full 2027 fiscal year, broadly in line with expectations for the wider auto industry. Q1 deliveries already ran well ahead of that pace, up 43 percent YoY, giving the company a strong start to the year.
About Honda Atlas Cars Pakistan
Honda Atlas Cars (Pakistan) Limited is a joint venture between Honda Motor Co., Ltd. of Japan and Pakistan’s Atlas Group. Headquartered in Lahore, the company assembles and sells the Honda City, Civic, HR-V and BR-V in Pakistan and is listed on the Pakistan Stock Exchange under the symbol HCAR.
Frequently Asked Questions
What was Honda Atlas Cars Pakistan’s profit in Q1 FY2027? The company reported a profit after tax of Rs. 2,486 million (Rs. 2.49 billion) for the quarter ended June 30, 2026, with earnings per share of Rs. 17.41.
Why did Honda Atlas Cars Pakistan’s profit jump 200 percent? The increase was driven by a 41 percent rise in revenue on higher car deliveries, a Rs. 1,590 million one-off gain from a settlement with the Government of Sindh over its SIDC liability, and a sharply lower effective tax rate.
Did Honda Atlas Cars Pakistan’s profit margins improve as well? No. Gross margin actually narrowed to 7.7 percent from 8.6 percent a year earlier, as the lower-margin Honda City made up a larger share of total sales than the Civic.
What is Honda Atlas Cars Pakistan’s stock ticker on the PSX? The company trades on the Pakistan Stock Exchange under the symbol HCAR.
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