Punjab Oil Mills (PSX: POML) is incorporated as a public limited company in Pakistan. The principal activity of the company is the manufacturing and sale of cooking oil, Ghee, specialty fat, coffee, as well as mushroom and laundry soap.
Pattern of Shareholding
As of June 30, 2025, POML has a total of 7.763 million shares outstanding which are held by 1716shareholders. Local general public has the majority stake of 46.62 percent in the company followed by directors, CEO, their spouse and minor children holding 28.15 percent shares of POML.
NIT and ICP account for 10.32 percent shares of the company while its parent company, Teejay Corporation (Private) Limited holds 6.75 percent shares. Around 5.94 percent of the company’s shares are held by Modarabas & Mutual Funds and 1.11 percent by joint stock companies. The remaining ownership is distributed among other categories of shareholders.
Historical Performance (2019-25)
Except for a decline in 2020 and 2024, POML’s topline has shown reasonable growth over the period under consideration. The bottomline dropped in 2020 but stayed in the positive territory.
The company posted net loss in 2021 followed by net profit in 2022. In 2023, POML’s net profit shrank followed by a negative bottomline in 2024 and 2025.POML’s margins portray an asymmetrical pattern over the period under consideration. Its gross margin posted a slight drop in 2019, maxed out in 2020 and then rode a downward trajectory until 2022. It was followed by an uptick in gross margin 2023 and 2024 and then a collapse in 2025.
Conversely, POML’soperating and net margin peaked in 2019, and then plunged for two successive years to post a rebound in 2022.In 2023 and 2024, operating margin continued to tick up while net margin gave in. In 2025, both operating and net margins deteriorated.The detailed performance review of the period under consideration is given below.
In 2019, POML’s topline grew by 11.18 percent year-on-year to clock in at Rs.5,504.23 million. This is primarily attributable to increase in sales volume of cooking oil segment. The newly introduced brands, Naturelle and Ella, were performing well and setting foothold in the market. Mushrooms were also in great demand in 2019; however, the coffee sales didn’t prove to be satisfactory.
Due to 40 percent depreciation in the value of Pak Rupee, the company’s cost of sales grew by 11.51 percent year-on-year as it used imported raw and packaging materials. During the year, the company revamped its production sites which provided greater operational and cost efficiency. This coupled with upward price revision enabled POML to largely maintain its GP margin in 2019.
Distribution expense dropped by 6.77 percent year-on-year in 2019 as the company adopted a rational approach in advertising and promotion to combat the steep rise in cost due to Pak Rupee depreciation which translated into reduced profitability in the first half of the year.
Administrative expense grew by 21.86percent year-on-year due to rise in salaries and wages which was the result of inflation as well as induction of additional human resource during the year for its new brands.
Other expense grew by 12.86 percent year-on-year in 2019 due to higher provisioning done for WPPF on account of higher profitability.
However, other expense was very much offset by 45.34 percent year-on-year rise in other income on the back of scrap sales and higher profit on bank deposits recognized during the year due to higher discount rate. This culminated into 33.96 percent year-on-year rise in operating profit with OP margin climbing up from 3.70 percent in 2018 to 4.44 percent in 2019.
While POML had a very low debt profile which only comprised of short-term borrowings, its debt-to-equity ratio grew from 7.4 percent in 2018 to 10 percent in 2019 on the back of greater working capital requirements. This coupled with higher discount rate fueled the finance cost by 95.11 percent year-on-year in 2019.
The bottomline grew by 55.27 percent year-on-year in 2019 to clock in at Rs.107.377 million with NP margin of 1.95 percent versus NP margin of 1.40 percent posted in 2018. EPS also grew from Rs.12.83 in 2018 to Rs.19.92 in 2019.
POML’s topline posted 4.28 percent year-on-year plunge in 2020 to clock in at Rs.5268.46 million.
The year started on a gloomy note with the imposition of 17 percent sales tax, which averted the distributors and retailers as if they were not willing to come under the sales net. Then COVID-19 hit the local and global economies, resulting in the complete shutdown of entertainment and restaurant industry. This greatly reduced the consumption of cooking oil and resulted in 6 percent drop in sales volume.
Cost of sales also plummeted by 4.61 percent year-on-year in 2020. While gross profit shrank by 2.37 percent year-on-year in 2020, GP margin improved to 14.98 percent as the company increased prices when sales improved in the beginning of 4QFY20 due to COVID related panic as households started stockpiling grocery in anticipation of lockdown.
Distribution expense showed no change in 2020 while administrative expense increased by 3.90 percent year-on-year due to 10 percent rise in salaries and wages on account of inflation. Other expense dropped by 12.1 percent year-on-year in 2020 on account of lower provisioning done for WWF and WPPF.
Other income posted a robust 75.68percent growth in 2020 due to higher profit on bank deposits coupled with gain on disposal of fixed assets as the company sold its hydrogen cell plant during the year.
Tolling income of 1.3 million also added to the growth of other income in 2020. Operating profit shriveled by 6.53 percent year-on-year in 2020, however, OP margin almost remained intact. Finance cost posted growth of 35.90 percent year-on-year in 2020 due to higher short-term borrowings coupled with SBP Refinance facility obtained by the company in 2020 for the payment of salaries and wages. This increased POML’s debt-to-equity ratio to 15.6 percent in 2020. The bottomline nosedived by 21.61 percent year-on-year in 2020 to clock in at Rs.84.18 million with NP margin of 1.6 percent. EPS dropped to Rs.15.62 in 2020.
POML’s net sales grew by 13.54 percent year-on-year to clock in at Rs.5981.84 million in 2021. During the first three quarters of 2021, the effects of COVID-19 continued which resulted in disturbance in the HORECA industry, the main customer of POML.
The increase in topline was the effect of upward revision in prices due to higher international edible oil prices. Moreover, the company also made export sales of cooking and specialty fat during 2021 which also buttressed the topline growth.
The rise in cost due to high international prices couldn’t be offset by higher prices keeping in view the tamed demand. This translated into 11.40 percent year-on-year drop in gross profit with GP margin posting a steep fall to clock in at 11.69 percent in 2021.
Distribution and administrative expenses grew by 8.31 percent and 19.46 percent respectively in 2021. The company allocated higher advertising budget in 2021. Salaries and wages also grew in line with inflation.
Furthermore, the company paid higher rent, rates and taxesfor the renewal of lease agreement during 2021. Other expense dropped by 64.81 percent year-on-year in 2021 due to lower provisioning for WWF and WPPF. Other income posted a phenomenal 33.9 percent rise in 2021 on account of higher scrap sales and tolling income.
Lower gross profit and higher operating expenses translated into a substantial 63 percent year-on-year dip in operating profit with OP margin tapering off to 1.41 percent in 2021. Finance cost reduced by 16.15 percent year-on-year in 2021 due to monetary easing while POML’s debt-to-equity ratio grew to 19.6 percent in 2021 due to higher short-term borrowings primarily for the retirement of L/C documents.
The company posted net loss of Rs.16.96 million in 2021 with loss per share of Rs.3.15.
In 2022, POML heaved a sigh of relief after sustaining two difficult years. POML’s topline posted a staggering 47.74 percent rise year-on-year to clock in at Rs.8837.68 million in 2022. With the HORECA industry operating at its optimum potential, the demand for cooking oil grew. This coupled with the increase in the prices due to high international edible oil prices kept the topline robust in 2022.
However, high cost of sales due to commodity super cycle in the international market coupled with Pak Rupee depreciation reduced the GP margin of POML to 9.24 percent – the lowest among all the years under consideration.
The company kept a thorough check on its operating expenses whereby its distribution expense slid by 8.34 percent year-on-year while its administrative expense only posted a marginal 2 percent year-on-year rise despite high inflation. The company scaled back its advertising and promotion budget as well as reduced directors’ remuneration to contain its operating expense during the year.
Conversely, other expense surged by 190 percent year-on-year in 2022 owing to higher provisioning for WWF and WPPF.
However, it was offset by 38 percent year-on-year growth in other income recorded in 2021 mainly on account of sale of a plot, reversal of provision against doubtful debt as well as profit on bank deposits recognized during the year.
Operating profit grew by 171.95 percent year-on-year in 2022 with OP margin improving to 2.60 percent. Finance cost grew by 165.48 percent year-on-year in 2022 due to elevated discount rate coupled with higher short-term borrowings.
POML made net profit of Rs.67.31 million in 2022 with NP margin of 0.76 percent. EPS grew to Rs.8.67 in 2022.
POML posted 11.40 percent year-on-year growth in its net sales which were recorded at Rs.9844.95 million in 2023. While sales volume remained depressed due to contraction in the purchasing power of consumers, the topline growth was the result of higher prices due to increase in the cost of imported raw materials (particularly edible oil) and Pak Rupee depreciation.
As the company passed on the impact of cost hike to its consumers, it was able to record an uptick in its GP margin in 2023 which clocked in at 9.36 percent. In absolute terms, gross profit improved by 12.85 percent in 2023. POML recorded a meager 0.76 percent growth in its distribution expense in 2023.
While freight charges went up sharply due to high international petroleum prices, the company curtailed its advertising & promotion budget to keep its distribution expense in check. Administrative expense mounted by 21 percent year-on-year in 2023 on account of higher payroll expense and fuel cost. This was despite the fact that the employee headcount was reduced from 299 in 2022 to 270 in 2023. 3.12 percent lower other expense recorded in 2023 was due to lower profit related provisioning.
Other income also shrank by 5.16 percent in 2023 due to high-base effect as the company sold its KPT plot in 2022. POML recorded 21.71 percent higher operating profit in 2023 with OP margin inching up to 2.84 percent.
Finance cost escalated 162.58 percent year-on-year in 2023 due to higher discount rate coupled with increased borrowings. Higher finance cost drove POML’s net profit down by 36.12 percent year-on-year to clock in at Rs.42.998 million in 2023 with EPS of Rs.5.54 and NP margin of 0.44 percent.
In 2024, POML’s net sales declined by 18.21 percent to clock in at Rs.8052.44 million. In the previous year, the company’s topline was supported by higher prices due to upward trend recorded in the international prices of edible oil.
However, in 2024, lower volume and lower international oil prices resulted in topline contraction.
Due to stability in the value of local currency as well as cost optimization measures put in place by the company such as installation of solar power plant and an efficient cooling system enabled it to attain a higher GP margin of 11.67 percent in 2024.Gross profit in absolute terms ticked up by 2 percent in 2024.
Distribution expense increased by 5.27 percent in 2024 due to increased freight charges on account of higher fuel charges. Administrative expense ticked down by 3.21 percent in 2024 due to lower payroll expense as the company streamlined its workforce from 285 employees in 2023 to 273 employees in 2024.
Lower payroll expense was also due to lower provisioning done for non-workman bonuses in 2024. Other expense magnified by 468.59 percent in 2024 as the company booked provision worth Rs. 56.35 million for ECL and Rs.9.64 million for slow-moving stores & spares.
Other income built up by 36.70 percent during the year due to higher profit on bank deposits. POML registered 15.73 percent lower operating profit in 2024 with OP margin slightly inching up to 2.92 percent.
Finance cost surged by 33.19 percent in 2024 due to high discount rate and increased short-term borrowings. POML recorded gearing ratio of 21.93 percent in 2024 versus gearing ratio of 17.74 percent recorded in 2023. All these factors translated into net loss of Rs.37.414 million in 2024 with loss per share of Rs.4.82.
In 2025, POML registered 14.77 percent year-on-year uptick in its topline which stood at Rs.9242.03 million. This was due to an improvement in the sales volume as the company made concerted efforts to increase its market penetration by strengthening its institutional sales, restructuring its sales force and supply chain to expand geographical outreach and diversifying its sales mix by venturing into food preservation business.
High cost of sales particularly raw materials and energy cost didn’t allow the topline to trickle down which resulted in gross profit shrinking by 5.84 percent in 2025. GP margin also plunged to 9.58 percent in 2025. This was because the company couldn’t pass on the impact of high cost on to its consumers because of their price sensitivity on account of their lower purchasing power.
Distribution expense ticked up by 8.28 percent in 2025 due to increased salaries of sales force and higher promotion & advertisement budget allocated for the year. Administrative expense grew by 11 percent in 2025due to inflationary pressure. This was despite the fact that the company streamlined its workforce from 273 employees in 2024 to 254 employees in 2025.
Other expense fell by 30.15 percent in 2025 due to lower provisioning done for WWF, WPPF, ECL and slow-moving store and spares.
Other expense was counterbalanced by 43.98 percent stronger other income recorded by POML in 2025 on account of higher profit on bank deposits, scrap sales and profit recognized on the sale of operating fixed assets. Operating profit nosedived by 32.29 percent in 2025 with OP margin falling down to 1.72 percent.
Finance cost tapered off by 22.20 percent in 2025 due to monetary easing and a decline in outstanding borrowings by better working capital management and retirement of a significant portion of outstanding debts. Gearing ratio marched down to 19.70 percent in 2025. POML recorded net loss of Rs.69.025 million in 2025 with loss per share of Rs.8.89 in 2025.
Recent Performance (1QFY26)
POML kicked off FY26 on a robust note with 38 percent year-on-year growth in its topline which clocked in at Rs.2605.14 million. The company’s efforts to diversify its product mix, geographical mix and supply chain optimization bore fruit resulting in increased demand and sales volume.
However, low purchasing power of consumers and high competitiveness didn’t allow the company to increase its prices with the same pace as its cost. While gross margin heightened by 26.34 percent in 1QFY26, GP margin dipped from 11.55 percent in 1QFY25 to 10.57 percent in 1QFY26.
Distribution expense surged by 14.23 percent in 1QFY26 as the company is expanding its sales force to tap new markets and also because of increased advertisement and promotion drives undertaken during the period.
Conversely, administrative expense ticked down by 20.23 percent during the period. This was the result of the company’s efforts to streamline its workforce to control its operating expense. Other expense escalated by 960.18 percent in 1QFY26 probably due to higher provisioning done for WWF and WPPF.
Other income dipped by 87.66 percent in 1QFY26, most likely due to thinner profit on bank deposits on account of monetary easing.
POML recorded a staggering 94.79 percent rise in its operating profit in 1QFY26 with OP margin clocking in at 3.18 percent versus OP margin of 2.25 percent recorded in 1QFY25. Finance cost plummeted by 37.29 percent in 1QFY26 due to lower discount rate.
Net profit clocked in at Rs.23.42 million in 1QFY26 versus net loss of Rs.22.737 posted in 1QFY25. The company posted EPS of Rs.3.02 and NP margin of 0.90 percent in 1QFY26 as against loss per share of Rs.2.93 in 1QFY25.
Future Outlook
POML is undertaking strategic moves such as installation of solar power plant and other energy efficient systems, expansion of its food preservation section for the canning plant for preserved foods and vegetables and venturing into new markets.
The company is also mulling over streamlining its customer mix to invest in HORECA segment and industrial consumers and focusing on premium brandsin order to boost its margins and profitability.
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