KARACHI, April 21, 2026 — Sazgar Engineering Works Limited said prolonged regional geopolitical tensions could pose challenges to Pakistan’s auto industry, even as improving macroeconomic indicators support a gradual recovery in demand.
In its financial results for the nine months ended March 31, 2026, the company said it remained cautiously optimistic about future prospects, citing stabilisation in key economic indicators, strengthening foreign exchange reserves and a pickup in industrial activity. However, it warned that global uncertainty, high fuel prices and pressure on consumer purchasing power could weigh on growth.
“The improving macroeconomic environment is encouraging, but regional geopolitical tensions may continue to impact business sentiment and supply chains,” the company said.
Pakistan’s auto sector recorded overall growth of about 29% during the third quarter, according to industry data, with strong gains in passenger vehicles and two-wheelers. The four-wheeler segment expanded nearly 39%, while tractors also posted a recovery, reflecting improving agricultural demand. However, the three-wheeler segment declined, highlighting uneven growth across categories.
Sazgar said the recovery has created opportunities for new model launches, particularly in the new energy vehicle segment. The rollout of its locally assembled CKD model of the TANK-500 is expected to strengthen its four-wheeler portfolio and support revenue growth.
The company reported robust financial performance, with nine-month sales rising 41.5% to Rs115.20 billion, while pre-tax profit increased 16% to Rs24.41 billion. Earnings per share climbed to Rs246.15 from Rs212.67 a year earlier. Growth was driven largely by strong performance in the four-wheeler segment, which contributed over Rs107 billion to total sales.
During the third quarter, sales rose nearly 29% year-on-year to Rs47.36 billion, while gross profit increased 6% and pre-tax profit grew 3.6%, reflecting steady operational performance despite cost pressures.
Sazgar said it had completed a major expansion of its four-wheeler operations, including installation of a new assembly line, a 5.7-megawatt solar power system and additional warehousing facilities. It has also announced a Rs22 billion investment plan to install a fully automated paint shop, which is expected to increase production capacity to 54,000 units annually.
The company is also planning to acquire additional land near its plant and develop new showrooms and service facilities to expand its market footprint.
Despite strong growth, Sazgar said its three-wheeler and tractor wheel rim segments remain sensitive to fuel prices, consumer affordability and agricultural conditions.
The company added that Pakistan’s economic outlook has improved, supported by stronger remittances, stable currency and a current account surplus in early 2026, though foreign direct investment remains subdued and the trade deficit has widened.
Looking ahead, Sazgar said it aims to sustain growth through operational efficiency, product diversification and strategic investments, while remaining vigilant to external risks that could affect demand and supply dynamics in the auto sector.