FIRST ASIA SECURITIES
PakistanSri LankaPREV
EquitiesFixed Income
DATA AS OF 13 JUL 2026 · EOD

DGKC

D.G. Khan Cement
CEMENT

LAST · PKR

217.30
−7.19 ▼ −3.20%
P/E 7.8× · YIELD 0.9% · ROE 12.2%

52W RANGE

149.18269.19
57% OF RANGE · YTD −4.2%
01 / DGKC — 1 YearAS OF 13 JUL 2026 · EOD
PERIOD 1Y · 250 SESSIONS▲
The Call
BUY+15%
250.00PKR · 12-MO
8.1× FY26E

Dispatch upcycle lifts volumes and margin.

Risks to our view
02 /

FAS DESK · FIRST ASIA SECURITIES RESEARCH · 23 JUN 2026 · EOD

High-beta leverage to the cement upcycle

  1. 01

    Buy, PKR 250 target: with dispatches turning up sector-wide, DGKC's operating and financial leverage make it the higher-beta way to play the cement recovery.

  2. 02

    North and south plants plus export exposure to Afghanistan and seaborne markets give volume optionality as the cycle extends.

  3. 03

    The catch is quality — a 12% ROE and a leveraged balance sheet mean the upside is cyclical, not structural.

  4. 04

    On recovering FY26E earnings at ~8.1× the target is PKR 250; a cycle trade, sized accordingly.

Where we differ from the street
Street viewOur viewWe change our mind if
May sales fell; the upturn is fragile.11-month dispatches are up and tracking a >50Mt year; DGKC's leverage magnifies that.Two post-budget months of double-digit dispatch decline.
High beta and gearing punish you in a downturn.Real risk — a higher-volatility expression of a bullish cement call, not a core holding.Finance costs outrunning the volume recovery.
Coal and energy squeeze the low-ROE names first.Operating leverage cuts both ways; a >50Mt year and pricing discipline lift DGKC disproportionately.Gross margin failing to expand as volumes rise.

— FIRST ASIA SECURITIES RESEARCH · NOT INVESTMENT ADVICE