ñ Panther Tyres Limited, formerly known as Mian Tyre and Rubber Company Limited, was founded in 1983 as a tyres and tubes manufacturing company.

ñ In 2011, the Company changed its name from Mian Tyre and Rubber Company Limited to Panther Tyres Limited.

ñ Location: Sheikhupura, spanning over an area of 168.6 kanals.

ñ Panther Tyres Ltd. is now a major player in tyres and tubes industry of Pakistan. Moreover, in an attempt to enhance its product portfolio, the Company penetrated into trading business of automobile lubricants and motorcycle spare parts in April, 2018.

ñ The Company also sells motorcycle engine oil and diesel engine oil for tractors, heavy transport vehicles, lifters and generators under its automobile lubricants segment.

Purpose of the Issue

ñ The new issue is to partially fund the Company’s expansion project to increase production capacities of Tyre Sets and Tubes.

ñ The Company intends to import latest and state of the art 4 Roll Calender Line from Comerio Ercole (Italy) to produce fine quality products with a high product thickness accuracy, while reducing wastage.

ñ The new line will also be used to produce radial tyres in the furture.

ñ Panther Tyres also intends to import fully automated Banbury Mixer from Farrel Limited (UK).

Subscribe up to PKR 60/share.

ñ We attribute Panther Tyres a Fair Value of PKR 69/sh. based on a blend of comparable Price-to-sales (x) and Price-to-book(x) multiples. We have selected these multiples due to availability of normalized peer data in these categories.

ñ We used a median P/B (x) of 1.27x and P/Sales (x) of 0.86x, as benchmark multiples, shown in the table.

ñ Post-IPO book value for Panther was forecasted using the latest available book value plus IPO proceeds of PKR 1.4bn.

ñ Panther’s sales were forecasted in accordance with Management guidance for FY21, amounting to PKR 16.4Bn.

ñ Our Fair Value provides an upside of 47% over the floor price of PKR 47/sh. We recommend “BUY” up to a price of PKR 60/sh., assuming minimum upside of 16%.

ñ With auto sales expected to grow at a CAGR of 11.9% and overall economic growth; prospects for Panther seem bright, being the first mover in terms of expansion.

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