Auto sales in March 2026 were reported at 15,531 units, rising 40%YoY but down 9%MoM, taking 9MFY26 sales to 144,000 units, up 43%. The YoY growth is primarily driven by sectoral tailwinds including macroeconomic stability, lower interest rates, and relatively better demand conditions. Passenger car sales increased 45%YoY to 11,755 units, while LCVs and Pickup segment posted a modest growth of 27%YoY to 3,776 units.
INDU: Indus Motors posted a 24%YoY growth, but flat MoM, selling 3,873 units during the month under review.
The Corolla, Yaris and Cross portfolio posted robust growth of 32%YoY to 3,145 units, while the Fortuner and Revo segment declined 3%YoY to 728 units, mainly due to increased competition from new cars launched at the start of the year. Overall, the company’s market share dropped to 25%.
HCAR: Honda posted a sharp growth of 63%YoY and 10%MoM to 2,324 units, primarily led by its sedan segment which grew by 71%YoY, while the SUV segment posted a growth of 18%YoY. HCAR’s market share improved to 15%.
SAZEW: Sazgar recorded 4-wheeler sale of 1,733 units, up 34%YoY in March. Sequentially, sales dropped 11%MoM. The Company’s market share improved to 11%. SAZEW rolled out the test unit of TANK 500 in April 2026 which shall provide a further support the volumes in upcoming months. Moreover, SAZEW’s three-wheeler sales improved 10%YoY to 2,159 units during the month.
Tractor: Tractor sales saw a sharp 98%YoY growth and 63%MoM to 3,008 units in March as deliveries for the Punjab tractor scheme neared completion. With the scheme’s impact subsiding, sales volumes are expected to normalize going forward. MTL’s market share dropped to 51%, while AGTL’s market share improved to 49% during Marxh.
Trucks: Trucks segment continues to benefit from relatively improved economic activity YoY along with stricter enforcement of Axle Load regime. Volumes were up 38%YoY to 488 units. GHNI’s volumes grew by 47% to 376 units in March. Meanwhile, GAL’s sales reached 340 units.
Despite intensifying competition, volumetric growth across listed auto OEMs remains robust, underscoring resilient underlying demand. However, analysts flag key overhangs to the sector’s near-term outlook, including pending regulatory clarity on the New Energy Vehicles (NEV) policy, rising competition from Chinese OEMs, and potential supply-side disruptions stemming from escalating Middle East tensions, which could impact shipping routes and delay CKD kit procurement for local assemblers.
Millat Tractors (MTL) reported consolidated profit after tax of PKR3.1 billion (EPS: PKR15.32), up an impressive 27%QoQ. Earnings surpassed analysts’ expectations, mainly due to stronger-than-expected gross margins, likely supported by a favorable sales mix. The result was also accompanied with a 2:1 share split announcement taking the face value from PKR10/ share to PKR5/ share.
Key result highlights for 3QFY26: Net sales were reported at PKR17 billion, surging by 37%YoY, higher than forecast, where the growth was likely driven by an improved sales mix skewing more towards higher horse power variants as volumetric sales over the same period grew by 7% only.
Gross margins remained elevated at 38%, contrary to the expectations of a contraction. It is believed that the sharp increase was likely driven by an improved sales mix towards higher margin products.
Distribution costs increased by 15% YoY to PKR508 million, mainly due to higher sales during the period under review.
Finance costs were recorded at PKR291 million, down 30%YoY, driven by a lower interest rates and lower reliance on short term borrowing, down 4% YoY.
The company recorded an effective tax rate of 37% as compared to 39% during the same period last year.
MTL continues to post robust earnings despite lackluster tractor demand, with volumes down 9%YoY in 9MFY26, reflecting continued weakness in the agricultural sector. The company’s pivot towards higher margin products has helped insulate it from this pressure. With sales under the Green Tractor Scheme coming towards an end, volumes might weaken further. The continued closure of the Afghan border, the company’s largest export market, remains a real concern, though ongoing efforts to diversify export markets could bear fruit and help improve volumetric sales.
Sazgar Engineering Works
(SAZEW) reported profit after tax of PKR6.4 billion (EPS: PKR106.51) for 3QFY26, up 60%QoQ and 3%YoY. This takes 9MFY26 net profit to PKR14.9 billion (EPS: PKR246.15), up 16%YoY. This translates earning above expectations and the deviation stemmed from better than expected Gross Margins, as well as lower-than-expected selling & distribution cost. The company announced a cash dividend of PKR20.0/ share, in line with analysts’ expectation, taking the 9MFY26 dividend per share to PKR50.0.
Key highlights for 3QFY26: Net sales were reported at PKR47 billion, up 29%YoY and 39%QoQ, driven by a 41%YoY and 47%QoQ increase in 4-wheeler volumes to 5,363 units. The YoY surge in 4-wheeler volumes was supported by the launch of the Haval H6 PHEV in 1QFY26.
Gross margins jumped to 27%. GMs improved sequentially despite a 2%QoQ PKR depreciation against Chinese Yuan during the quarter, warranting further clarity.
Selling and Distribution cost rose 63%YoY and 18%QoQ to PKR1.7 billion. The sharp uptick likely reflects elevated marketing and promotional activity amid intensifying competition.
Other income surged 7%QoQ to PKR761 million. The YoY growth was driven by a rise in cash and cash equivalents, which doubled YoY.
The effective tax rate came to 39% flat YoY.
SAZEW has posted solid results, driven by strong volume growth and a modest uptick in gross margins. The rollout of TANK 500, alongside the upcoming Cannon Alpha launch, should provide near-term support to volumes. However, with the Auto Policy set to expire by June 2026, analysts expect some pressure on margins as incentives normalize. The new policy is likely to favor EVs and PHEVs, positioning SAZEW as a potential beneficiary given its evolving product mix.