KHFZ Lifts Domestic Prices 20% From 28 October; Retail Has Been a Net Seller for 20 Sessions and the Sahmino Desk Targets 3,003 Rial (Wednesday 28 October 2026)

Hafez Tile and Ceramic (KHFZ) said on Codal at 14:59 on Wednesday 28 October 2026 that a board resolution raises the selling prices of its domestic products by an average of 20%, effective the same day. The disclosure came after the session ended (close 2,735 rial, read at 17:33 Tehran time), so the first session that can price it is Saturday 31 October. The question is whether the new price reaches profit or costs eat it: standalone six-month net profit to 22 September 2026 is up about 82%, but selling and administrative costs rose 220% and operating cash flow is only 53% of profit.

Background

KHFZ trades on the first market of the Tehran Stock Exchange with 22.006 billion shares, 34% of them free float according to the exchange card (nightly reading of 27 October). The company filed the disclosure in group B: the form prints the item at 4.5% of last fiscal year's total assets and 8.13% of last year's total sales revenue, below the 10% threshold that moves a disclosure to group A (Codal tracing number 1623386). On the same day ALVN announced increases of 25% on wall tiles and 30% on floor and porcelain tiles (tracing number 1622877), and PRPT had raised prices 15% from 23 October (our 29 September report). Tile makers are raising prices together; whether KHFZ benefits depends on its own statements.

The numbers

Figures come from the standalone, unaudited six-month statement to 22 September 2026 (tracing number 1620421, amended 26 October; the prior-year column is restated and audited). Codal prints in million rial; we convert at 1 million rial = 100,000 tomans.

• Revenue: 2,624.0 billion tomans against 1,311.3 (up 100%). Cost of sales rose 92%, so gross profit went to 938.7 from 431.6 and the gross margin from 32.9% to 35.8%.
• Profit: operating profit 782.6 against 390.5 and net profit 671.0 against 369.0 billion tomans (82% higher); earnings per share 306 against 168 rial. Trailing twelve-month net profit (our combination of the 2025/26 annual figures and the two half-years, not a printed column) is 1,013.4 billion tomans, or 461 rial a share.
• Costs: selling, administrative and general expenses 175.4 against 54.8 (up 220%) and finance costs 119.2 against 36.0 billion tomans (up 231%). The net margin therefore slipped from 28.1% to 25.6% even as the gross margin rose.
• Cash: net operating cash flow 354.9 billion tomans, 53% of the period's net profit. Fixed-asset purchases were 307.8, leaving a simple remainder of 47.1 billion tomans (our subtraction, not an official free cash flow).
• Balance sheet at 22 September: cash 111.2 and interest-bearing debt 813.9 billion tomans (313.9 short-term, 500.0 long-term) against equity of 3,866.0; dividends payable were 364.1 billion tomans, up from 18.3 at the March 2026 year end.

Drivers

The price mechanism. The September monthly activity report (tracing number 1614660) shows domestic sales of 276.2 billion tomans and exports of 248.3; total revenue was 493.8, 15.9% above the 426.0 monthly average of the five months before. If domestic volume and mix stay as in September, 20% higher prices add 55.2 billion tomans of revenue a month and about 261 billion tomans by the 20 March 2027 year end (roughly 4.7 months), or 8.9% of last year's revenue of 2,933.5 billion tomans. That sits in the same range as the 8.13% the form prints. Using the six-month average of domestic sales (298.5 a month) gives 9.6%. Both are our arithmetic scenarios, not company forecasts, they leave out costs, and domestic sales include a small share of resold goods.

Price has run ahead of cost. Over the same six months revenue grew 100% and cost of sales 92%. The new price lands on a base whose gross margin had already widened.

The dividend. The 22 July 2026 meeting approved a cash dividend of 161 rial a share for the year to March 2026, 49.85% of earnings of 323 rial, 354.3 billion tomans in all (tracing number 1577235). The company says individuals are paid on 14 November and institutions on 18 November (Sahmino calendar). The entitlement belongs to holders on the meeting date, so a buyer today does not receive it; it matters for the company's cash, because a 354 billion toman payout has to be funded from operations and borrowing against 111 billion tomans of cash at the end of September.

Outlook

Valuation. At a close of 2,735 rial on 28 October (read at 17:33; the exchange revises closes until about 22:00) and the exchange card's trailing earnings of 461 rial a share, the price is 5.93 times earnings. The tile and ceramic sector stands at 6.96 on the same card (nightly reading of 27 October), so KHFZ is 14.8% below the sector (base: the sector ratio). In Sahmino's screen of the tile industry, eight names have positive earnings and KHFZ has the second-lowest multiple (SINA 5.6, KHFZ 5.9, ALVN 6.0, PRPT 6.9, KPRS 9.0, KSDP 10.8, KSAD 18.3, TKSM 40.9). Its annual profit growth of 81.9% ranks seventh of the eight, so part of the discount reflects slower growth.

Flow. From 30 September to 27 October (20 sessions) retail investors net sold 1,175.0 billion rial, or 117.5 billion tomans; both the nightly card and the sum of our recorded sessions give that figure. The price was almost flat over the window (close 2,696 on 30 September, 2,701 on 27 October). Today retail net bought 3.3 million shares (about 9.1 billion rial, estimated as volume times the close). The close is 9.4% below the 52-week traded high of 3,020 rial set on 14 October.

The desk call. From the 27 October session the Sahmino desk has a buy on KHFZ: reference price 2,701 rial, target 3,003, invalidation 2,603, horizon 15 sessions, market regime "falling, volatile". The stance is "counted" and has no separate probability or sample. Two open signals from 7 October claim the same target with chances of 72.3% and 71.1%, with no random-entry control beside them. The desk's record: of 2,243 settled stances, 1,026 (45.7%) reached the target, 1,081 were invalidated and 136 expired. At 2,735 the close is 8.9% below the target (base: the target) and 5.1% above the invalidation (base: the invalidation); reward to risk from this close is 2.0 (our calculation).

Bottom line

The 20% price rise adds about 9% of last year's revenue by the end of the fiscal year and reaches profit provided selling, finance and cash costs do not run ahead; that condition is fragile today. Yesterday's desk call on Jam Piln (JPPC) (target 398,591, invalidation 347,609 rial) is still open: the 28 October close of 368,200 rial stayed above the invalidation. Sahmino desk: KHFZ reaches 3,003 rial within 15 sessions if it does not close below 2,603; condition: the 20% price rise takes effect and the close holds above 2,603; horizon: 15 sessions from 27 October; invalidation: a daily close below 2,603 rial. Reading of 28 October 2026.

What to follow

• The reaction on Saturday 31 October, the first session after the disclosure: the close against 2,603 and 3,003 rial and retail flow on the KHFZ symbol page.
• The October monthly activity report: domestic selling price and volume, to see whether the new price took effect without cutting volume.
• The nine-month statement: selling and finance costs, operating cash flow and dividends payable.

Run the same comparison in the Sahmino screener: tile and ceramic industry, positive price-to-earnings, sorted from low to high, with profit growth beside it.