Industries Qatar (IQCD) reported a net profit of QAR 1,615 mn in 3Q22 (our estimate of a net profit of QAR 2,576 mn) compared to a net profit of QAR 2,100 mn in 3Q21. The bottom line was hit mainly due to a lower topline and a higher-than-expected jump in feedstock prices. Though the top line in 3Q22 increased by 24.2% YoY, direct cost increased by 57.7% YoY to QAR 3,258 mn, resulting in a gross margin of 22.6% (our estimate of 39.3%) compared to 39.1% in 3Q21. The topline growth came in lower during the quarter than our estimate due to lower-than-expected fertilizer and steel segment revenue growth. Fertilizer segment revenue in 3Q22 declined by 21% QoQ to QAR 3,157 mn due to a reduction in selling prices. Selling price on average fell by 23% QoQ during the quarter amid significantly elevated energy prices. Steel segment revenue in 3Q22 declined by 9% QoQ to QAR 1,055 mn resulting from the decline in selling prices which reduced by 18% QoQ as most of the sales volumes were diverted to international markets, where margins tend to be comparatively lower than the domestic market.