Embed Size (px)
Citation preview
AKD Research [email protected]
+92-21-111-253-111
Weekly Review
Amidst the inevitable Rupee devaluation against the US dollar and continued political uncer-
tainty arising from judicial developments, the KSE-100 index weakened 1.11%WoW closing
at 38,646pts with average daily volumes traded decreasing to 135mn shares (down 4.39%
WoW). Market sentiment cratered under a ‘controlled’ devaluation exercise by the SBP
which saw the PkR lose 4.6%WoW against the Greenback, leading participants to raise con-
cerns over the knock-on effects on the import bill, inflation and consumer confidence. Key
news flows impacting the market during the week included: 1) Supreme Court ruling in fa-
vor of PTI Chairman Imran Khan in a disqualification case, while disqualifying PTI General
Secretary Jahangir Khan Tareen, 2) Supreme Court dismissing NAB’s appeal to reopen the
Hudaibiya Paper Mills case, 3) NA speaker hinting towards early dissolution of assemblies,
while later refuted by PM Shahid Khaqan Abbasi, 4) trade deficit treading upward in Nov’17,
with 5MFY18 deficit now standing at US$15.03bn (up 29%YoY) and 5) long steel manufac-
turers raising re-bars prices by ~PkR5000/ton. Gainers (of AKD Universe) during the week
were: 1) EFERT (8.39%WoW), 2) KAPCO (5.72%WoW), 3) ENGRO (3.26%WoW), 4) PPL
(2.60%WoW) and 5) OGDC (1.85%WoW) while the laggards were: 1) HASCOL (-12.05%
WoW), 2) LUCK (-7.78%WoW), 3) PIOC (-7.73%WoW), 4) FCCL (-6.67%WoW) and 5) APL (-
6.54%WoW). Top 5 volume leaders included: 1) TRG (67.23mn), 2) KEL (51.39mn), 3) PAEL
(36.25mn), 4) WTL (30.54mn) and 5) ANL (22.81mn). During the week, foreign outflow of
US$8.87mn was recorded against a net inflow of US$1.04mn last week.
StockSmart
AKD Equity Research / Pakistan
Pakistan Weekly Update
Important disclosures including investment banking relationships and analyst certification at end of this report. AKD Securities does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of the report. Investors should consider this report as only a single factor in making their investment decision.
Important disclosures
Copyright©2017 AKD Securities Limited. All rights reserved. The information provided on this document is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to law or regulation or which would subject AKD Securities or its affiliates to any registration requirement within such jurisdiction or country. Neither the information, nor any opinion contained in this document constitutes a solicitation or offer by AKD Securities or its affiliates to buy or sell any securities or provide any investment advice or service. AKD Securities does not warrant the accuracy of the information provided herein.
www.akdsecurities.net
AKD Securities
TREC Holder & Registered Broker
Pakistan Stock Exchange
REP-108
Find AKD research on Bloomberg
(AKDS<GO>), firstcall.com and Reuters Knowledge
Apex court judgments on two key cases offering win-win situation to both PML (N) and PTI point towards relatively stable political environment going forward. This along with much-awaited devaluation exercise attracting higher foreign interest and encouraging participation by individuals and mutual funds at current levels give weight to wider consolidation as we approach the year-end window-dressing period.
15 December 2017
Outlook
Index & Volume Chart
Source: PSX & AKD Research
Universe Gainers & Losers
38,482
38,525 38,820
38,224
38,646
37,900
38,000
38,100
38,200
38,300
38,400
38,500
38,600
38,700
38,800
38,900
-
50,000
100,000
150,000
200,000
11-Dec 12-Dec 13-Dec 14-Dec 15-Dec
(Index)(Shrs'000)
Ready Volume (LHS) KSE100 Index (RHS)
Indices KSE-100 KSE-30
This w eek 38,646 19,280
Last w eek 39,080 19,491
Change -1.11% -1.08%
Indices KMI-30 Allshare
This w eek 66,325 28,636
Last w eek 67,013 28,896
Change -1.03% -0.90%
Mkt Cap. PkRbn US$bn
This w eek 8,242 74.64
Last w eek 8,321 77.77
Change -0.94% -4.03%
Avg. Daily Turnover ('mn shares)
This w eek 135.07
Last w eek 141.27
Change -4.39%
Top-5 Volume Leaders
Symbol Volume (mn)
TRG : 67.23
KEL : 51.39
PAEL : 36.25
WTL : 30.54
ANL : 22.81
-15.0%
-10.0%
-5.0%
0.0%
5.0%
10.0%
EFER
T
KAPC
O
ENG
RO PPL
OG
DC APL
FCCL
PIO
C
LUCK
HAS
COL
Source: PSX & AKD Research
33,000
35,000
37,000
39,000
41,000
43,000
45,000
47,000
49,000
51,000
53,000
-50
50
150
250
350
450
550
650
750
850
950
Dec
-16
Jan
-17
Feb
-17
Mar
-17
Ap
r-1
7
Ap
r-1
7
May
-17
Jun-
17
Jul-1
7
Au
g-17
Sep
-17
Oct
-17
No
v-1
7
Dec
-17
(Index)(share mn)
Volume (LHS) KSE-100 Index
AKD Securities Limited
15 December 2017
StockSmart
Pakistan Weekly Update
This Week’s Daily Reports
2
Dec 14, 2017
ASTL: Towering to diversify business, (AKD Daily, Dec 15, 2017)
Diversifying into tower manufacturing business, ASTL plans on setting up a joint venture with the Chinese company "Qingdao Huijintong Power Equipment Company Ltd (HJT)". The proposed venture (Amreli-Huijintong pvt Ltd) would include the production and sale of transmission towers, where ASTL is expected to take 65% equity stake, entailing total in-vestment amount of ~PkR1.67bn. Our preliminary research indicates that the proposed project would take at least 1-1.5years to come online. With cost plus pricing model, tower manufacturing industry offers superior margins compared to the re-bars manufacturers (see table IV). In the backdrop of new generation capacity coming online coupled with inade-quate existing T&D network, we expect the gov't to shift focus towards T&D segment, gen-erating additional demand for towers. Analyzing the same, our sensitivity analysis using varying capacity and margin levels reveals incremental operating income from the new ven-ture in the range of PkR186-296mn (see table II). On the flipside, concentrated customer base (i.e. NTDC, KEL, FTCL & STDCPL in Pakistan case) and delayed materialization of mega projects present business and liquidity risk.
Autos: “Go out with the old and in with the new”, (AKD Daily, Dec 14, 2017)
Prevailing competitive dynamics in the auto space can be said to be nascent at best. Taking cues from past offerings of now defunct OEMs (KIA, Hyundai, Nissan), we construct a case for why new entrants are expected to penetrate the passenger car market. Highlighting the minimal impact these offerings made in the past (largely from idiosyncratic factors hinder-ing proper production runs), we compare their performance to older variants offered by incumbent OEMs (FX, Baleno, Liana, etc.). Lastly, looking at the average life of variants of-fered by incumbents (INDU, HCAR, PSMC) the stretched production life of PSMC's offerings remains unsustainable in the face of emerging threats from new entrants, in our view. Com-paring local model launches with the international release of variants by incumbents we emphasize the shortening of the product life cycle for local OEMs as an unavoidable trend for local OEMs.
Nov'17: Commodities Update, (AKD Daily, Dec 13, 2017)
Continuing to climb, bullish sentiment prevailed during Nov'17 with commodity index firm-ing up around 189.1 points. This uptrend was led by higher oil prices that treaded upwards (Brent/WTI gaining9.4%/10.3%MoM) following OPEC's agreement to extend supply cuts amid escalating Middle East crisis. Similar trend was seen in Coal (+2.4%MoM) with the in-crease being driven by higher demand in China (ongoing heating season, lower hydro power output). Steel prices also treaded upwards (+2.1%MoM) as the Chinese government imple-ments a policy of curtailing supply in the backdrop of improved demand. That said, prices for international milk (FAO dairy index down 4.9%MoM) and Urea (down 1.8%MoM) cooled on the back of rising output. Going into Jan'17, the commodity cycle can sustain its current uptrend with weather disruptions, policies of the Chinese govt. and manageable inventory levels making room for higher prices.
Autos: Nov'17 sales numbers are nothing to complain about, (AKD Daily, Dec 12, 2017)
Total automotive industry sales moved -9.6%MoM/+17.6%YoY for Nov'17 with total indus-try sales clocking in at 21,765 units, taking cumulative 11MCY17 sales to 229,085 units (+18.6%YoY). Adhering to the trend of seasonal weakness from the month of November, negative movement of -11.2%/-2.1%/-4.4%/-60.5%/-8.1% for Passenger Cars/LCVs & Pickups/ Trucks/Buses/Tractors was witnessed. Running a basic time series analysis of MoM moves between Nov vs. Oct between CY11-16 shows an average total industry sales unit dip of -2.2%MoM, which falls to -7.1% ex CY16 (Rozgar scheme year). Category-wise declines were led by the 1000CC category (-29.5%MoM/+31.4%YoY) followed by 800CC and below (-12.3%MoM/+16.8%YoY) while the 1300CC+ segment sales sustained momentum (+1.0%MoM/-5.1%YoY). Additionally, for the outgoing month INDU/PSMC/HCAR reported their capacity utilization at 118.8%/91.5%/108.4%, taking the 11MCY17 capacities to 112.4%/87.7%/95.8% for SPLY. We remain upbeat on INDU's prospects for passing on any price hikes (following recent PkR weakness), while capacity expansion raises the OEMs abil-
Source: PSX & AKD Research
Dec 13, 2017
Dec 15, 2017
Dec 12, 2017
Dec 11, 2017
38,200
38,300
38,400
38,500
38,600
38,700
38,800
38,900
39,000
9:1
5
9:4
3
10:1
1
10:4
0
11:0
8
11:3
6
12:0
5
12:3
3
13:0
1
13:2
9
13:5
7
14:2
5
14:5
4
15:2
2
15:5
1
16:1
9
38,000
38,100
38,200
38,300
38,400
38,500
38,600
38,700
38,800
38,900
9:3
0
9:5
3
10:1
7
10:4
1
11:0
4
11:2
8
11:5
2
12:1
5
12:3
9
13:0
2
13:2
6
13:4
9
14:1
3
14:3
7
15:0
0
15:2
4
38,400
38,450
38,500
38,550
38,600
38,650
38,700
38,750
38,800
38,850
38,900
9:3
0
9:5
5
10:2
0
10:4
5
11:1
0
11:3
4
11:5
9
12:2
4
12:4
9
13:1
3
13:3
8
14:0
3
14:2
8
14:5
3
15:1
8
38,350
38,450
38,550
38,650
38,750
38,850
38,950
39,050
39,150
39,250
39,350
39,450
39,550
9:3
0
9:5
5
10:2
0
10:4
5
11:1
0
11:3
5
11:5
9
12:2
4
12:4
9
13:1
4
13:3
9
14:0
3
14:2
8
14:5
3
15:1
8
N.A
AKD Securities Limited
15 December 2017
StockSmart
Pakistan Weekly Update
This Week’s Daily Reports
3
ity to meet any escalation in demand.
ENGRO: More opportunity than meets the eye, (AKD Daily, Dec 11, 2017)
In the backdrop of recent weakness in stock price (-18%CYTD), we reiterate our liking for ENGRO with our rolled forward Dec'18 TP of PkR348.8/sh (upside: 34%). Our recommenda-tion for the conglomerate is underpinned on all-round improvements in the form of: 1) re-covery in fertilizer business (EFERT earnings up 18%YoY for 9MCY17), 2) impressive turna-round in polymer business (EPCL earnings up 61.1xYoY in 9MCY17), 3) higher utilization for its Elengy and Vopak business lines and 4) smooth progress at its flagship Thar coal mining & power project (currently 4 months ahead of schedule and expected to reach COD by Jun'19). In addition to value enhancements prospects through ongoing operations, there has been some clarity on utilization of its cash rich balance sheet (cash & cash equivalent of PkR62bn) in the shape of: 1) investment in 450MW RLNG based Power Plant at Port Qasim and (pending tariff approval from NEPRA) and 2) intentions to setup a second LNG terminal. Recent price correction due to relegation from MSCI Global EM index to the small cap EM index offers attractive entry points, considering fundamental growth remains intact (4yr forward earnings CAGR of 44%).
AKD Securities Limited
15 December 2017
StockSmart
Pakistan Weekly Update
4
Commodities
International Major Currencies
Source: Bloomberg
Source: Bloomberg
Major World Indices’ Performance
Source: Bloomberg
TRJ-CRB Index
Source: Bloomberg
PkR/US$ Trend
Source: Bloomberg
Regional Valuations (2017)
Source: Bloomberg & AKD Universe
165
168
171
174
177
180
183
186
189
192
195
198
Dec-
16
Jan-1
7
Feb
-17
Mar-
17
Apr-
17
May-
17
Jun-1
7
Jul-17
Aug-1
7
Sep-1
7
Oct-17
Nov-
17
Dec-
17
101.0
102.0
103.0
104.0
105.0
106.0
107.0
108.0
109.0
110.0
111.0
112.0
Dec-
16
Jan-1
7
Feb
-17
Mar-
17
Apr-
17
May-
17
Jun-1
7
Jul-17
Aug-1
7
Sep-1
7
Oct-17
Nov-
17
Dec-
17
SPOT Units 15-Dec-17 8-Dec-17 WoW CYTD
TRJ-CRB Points 184.2184 185.0158 -0.43% -4.31%
Nymex (WTI) US$/bbl. 57.41 57.36 0.09% 6.87%
ICE Brent US$/bbl. 64.03 63.67 0.57% 15.56%
N. Gas Henry Hub US$/Mmbtu 2.6658 2.7465 -2.94% -27.60%
Cotton USd/Pound 84.7 84.7 0.00% 6.68%
Gold US$/Tr.Oz 1257.58 1248.5 0.73% 9.14%
Sliver US$/Tr.Oz 15.9843 15.8585 0.79% 0.42%
Copper US$/MT 6761 6536.75 3.43% 22.42%
Platinum US$/Oz 884.45 888.28 -0.43% -2.11%
Coal US$/MT 97.7 94.75 3.11% 16.66%
SPOT 15-Dec-17 8-Dec-17 Chg +/- WoW CYTD
Dollar Index 93.471 93.901 -0.430 -0.46% -8.97%
USD/PkR 110.100 108.800 1.300 1.19% 5.03%
USD/JPY 112.200 113.480 -1.280 -1.13% -3.72%
EUR/USD 1.180 1.177 0.002 0.20% 12.46%
GBP/USD 1.340 1.339 0.001 0.06% 9.27%
AUD/USD 0.767 0.751 0.016 2.17% 6.28%
NZD/USD 0.703 0.685 0.018 2.61% 0.88%
CHF/USD 0.989 0.993 -0.004 -0.38% -3.33%
CAD/USD 1.277 1.285 -0.008 -0.61% -5.42%
USD/KRW 1,089 1,094 -4.120 -0.38% -9.81%
CNY/USD 6.609 6.621 -0.012 -0.19% -5.00%
Country Bloomberg Code 15-Dec-17 8-Dec-17 WoW CYTD
Pakistan KSE100 Index 38,646 39,080 -1.11% -19.2%
Srilanka CSEALL Index 6,352 6,375 -0.36% 2.0%
Thailand SET Index 1,718 1,707 0.65% 11.3%
Indonesia JCI Index 6,119 6,031 1.47% 15.5%
Malaysia FBMKLCI Index 1,753 1,721 1.85% 6.8%
Philippines PCOMP Index 8,337 8,305 0.39% 21.9%
Vietnam VNINDEX Index 935 940 -0.53% 40.7%
Hong Kong HSI Index 28,848 28,640 0.73% 31.1%
Singapore FSSTI Index 3,417 3,425 -0.22% 18.6%
Brazil IBX Index 29,951 30,073 -0.41% 20.8%
Russia RTSSTD Index 13,946 13,675 1.98% -5.4%
India SENSEX Index 33,463 33,250 0.64% 25.7%
S&P SPX Index 2,652 2,652 0.02% 18.5%
DJIA INDU Index 24,509 24,329 0.74% 24.0%
UK UKX Index 7,450 7,394 0.76% 4.3%
Germany DAX Index 13,030 13,154 -0.94% 13.5%
Qatar DSM Index 8,212 7,774 5.64% -21.3%
Abu Dhabi ADSMI Index 4,339 4,277 1.46% -4.6%
Dubai DFMGI Index 3,355 3,393 -1.12% -5.0%
Kuwait KWSEIDX Index 6,332 6,187 2.34% 10.2%
Oman MSM30 Index 5,062 5,066 -0.08% -12.5%
Saudi Arabia SASEIDX Index 7,076 7,086 -0.14% -1.9%
MSCI EM MXEF Index 1,121 1,111 0.94% 30.0%
MSCI FM MXFM Index 627 627 0.09% 25.6%
EPS Growth PE(x)
Pakistan 19% 7.44
Indonesia 11% 15.45
Malaysia 12% 15.94
Philippines 7% 15.18
Vitenam 12% 18.16
India 28% 17.07
China 13% 12.72
% ROE Divd Yld
Pakistan 15.6% 7.13
Indonesia 15.02 2.32
Malaysia 10.18 3.47
Philippines 12.16 1.56
Vitenam 16.14 1.97
India 15.43 1.57
China 11.52 2.24
5
AKD Securities Limited
15 December 2017
StockSmart
Pakistan Weekly Update
Chart Bank
FIPI Flows for the week
Advance to Decline Ratio
AKD Universe vs. KSE-100 Index
LIPI Flows for the week
Earnings Yield vs. T-Bill (12M) Differential
KSE-100 vs. MSCI-EM & MSCI-FM
-30%
-20%
-10%
0%
10%
20%
30%
40%
Dec
-16
Jan-
17
Feb
-17
Mar
-17
Ap
r-17
May
-17
Jun
-17
Jun
-17
Jul-
17
Au
g-17
Sep
-17
Oct
-17
No
v-17
Dec
-17
KSE10 0 MSCI EM MSCI FM
608
(8,791)
(2,772)
1,971
117
(9,970)
(7,970)
(5,970)
(3,970)
(1,970)
30
2,030
11-Dec-17 12-Dec-17 13-Dec-17 14-Dec-17 15-Dec-17
(US$'000)
-2.00
-1.50
-1.00
-0.50
0.00
0.50
1.00
1.50
No
v-16
Dec
-16
Jan-
17
Feb
-17
Mar
-17
Ap
r-17
May
-17
Jun
-17
Jul-
17
Au
g-17
Sep
-17
Oct
-17
No
v-17
No
v-17
(%)
Ind., (17.80)
Co., 10.70
Bank/DFI, 11.27
NBFC, 0.30
M.Funds, 6.53
Ins, (0.71)
Others, 0.94
Prop. Trading , (2.37)
(20.00)
(15.00)
(10.00)
(5.00)
-
5.00
10.00
15.00
0.75
0.80
0.85
0.90
0.95
1.00
1.05
1.10
1.15
1.20
1.25
1.30
1.35
1.40
1.45
1.50
Dec-1
6
Jan-1
7
Jan-1
7
Feb
-17
Ma
r-1
7
Ma
r-1
7
Apr-
17
Apr-
17
Ma
y-17
Jun-1
7
Jun-1
7
Jul-1
7
Aug-1
7
Aug-1
7
Sep-1
7
Sep-1
7
Oct
-17
Nov-1
7
Nov-1
7
Dec-1
7
-22%
-17%
-12%
-7%
-2%
3%
8%
13%
18%
23%
De
c-1
6
Jan
-17
Feb
-17
Mar
-17
Ap
r-1
7
May
-17
Jun
-17
Jul-
17
Au
g-1
7
Sep
-17
Oct
-17
No
v-1
7
De
c-1
7
KSE-All Share Index AKD Universe
6
AKD Securities Limited StockSmart
Pakistan Weekly Update
Market PER Chart 2017
Source: AKD Research
Market P/BVS Chart 2017
Source: AKD Research
15 December 2017
Jul-
07
Feb
-08
Oct
-08
Jun-
09
Feb
-10
Oct
-10
May
-11
Jan-
12
Sep
-12
May
-13
Jan-
14
Sep
-14
Apr
-15
Dec
-15
Aug
-16
Apr
-17
Dec
-17
14.0
10.5
7.0
3.5
(x)
Jul-0
7
Feb-
08
Oct
-08
Jun-
09
Feb-
10
Oct
-10
May
-11
Jan-
12
Sep-
12
May
-13
Jan-
14
Sep-
14
Apr-
15
Dec
-15
Aug-
16
Apr-
17
Dec
-17
2.5
2.0
1.5
1.0
(x)
7
AKD Securities Limited StockSmart
Pakistan Weekly Update
AKD Universe Active Coverage Cluster’s Valuations
15 December 2017
Source: AKD Research UR Under Review
Stock Symbol Price TP Stance EPS(PkR) PE(x) PB(x) DY(%)
(PkR) (PkR) 17 18F 19F 17 18F 19F 17 18F 19F 17 18F 19F
Automobile and Parts
Indus Motors INDU 1,680.91 2,069.97 Buy 165.41 159.58 185.44 10.16 10.53 9.06 4.24 3.76 3.22 6.84 6.54 6.54
Pak Suzuki Motors PSMC 472.35 800.66 Buy 44.98 57.33 58.31 10.50 8.24 8.10 1.32 1.16 1.04 1.91 2.33 2.54
Cements
DG Khan Cement DGKC 123.17 194.00 Buy 18.20 16.40 17.85 6.77 7.51 6.90 0.72 0.69 0.65 6.09 6.50 5.68
Lucky Cement LUCK 454.81 898.00 Buy 42.34 34.15 37.79 10.74 13.32 12.03 1.84 1.76 1.59 2.64 2.20 2.64
Maple Leaf Cement Factory MLCF 66.14 107.00 Buy 7.92 6.98 7.46 8.35 9.47 8.86 1.68 1.27 1.05 4.96 9.08 9.08
Fauji Cement Company Ltd. FCCL 22.81 39.00 Buy 1.89 2.59 3.22 12.04 8.81 7.08 1.60 1.53 1.43 3.95 8.77 10.96
Pioneer Cement Limited PIOC 53.49 109.00 Buy 12.84 9.04 10.54 4.16 5.92 5.08 0.99 0.93 0.85 10.28 9.35 11.22
Cherat Cement Co Limited CHCC 90.90 140.00 Buy 11.08 10.71 12.79 8.21 8.48 7.11 1.53 1.41 1.25 2.95 4.40 5.50
Gharibwal Cement Ltd GWLC 22.10 58.00 Buy 5.71 4.07 4.49 3.87 5.43 4.93 0.78 0.74 0.71 13.57 14.71 12.44
Engineering
Amreli Steels Ltd. ASTL 84.65 128.00 Buy 3.62 5.56 14.70 23.41 15.22 5.76 2.26 1.96 1.52 2.36 2.36 7.09
Fertilizers
Engro Corporation ENGRO 268.66 348.84 Buy 20.47 21.56 27.91 13.13 12.46 9.63 1.70 1.68 1.61 8.56 7.44 8.19
Engro Fertilizers Limited EFERT 64.48 72.24 Accumulate 7.19 7.23 7.37 8.97 8.92 8.74 1.97 1.89 1.83 8.36 8.97 9.72
Fauji Fert. Bin Qasim Ltd. FFBL 33.15 48.10 Accumulate 2.03 2.60 2.79 16.30 12.74 11.88 2.30 2.13 1.99 4.91 6.28 6.74
Fauji Fertilizer Company FFC 75.46 96.86 Buy 6.97 7.66 8.34 10.83 9.85 9.05 3.30 3.19 3.08 8.31 9.13 9.94
Fatima Fertilizer FATIMA 28.25 45.11 Buy 5.06 5.44 6.00 5.58 5.20 4.71 1.09 1.00 0.93 11.64 13.47 14.87
Food Producers
Engro Foods Limited EFOODS 71.01 84.20 Accumulate 0.75 1.19 1.22 94.92 59.47 58.05 2.94 2.78 2.61 - - -
Oil & Gas
Oil & Gas Development Co. OGDC 156.70 190.00 Buy 14.83 18.46 18.51 10.56 8.49 8.47 1.30 1.17 1.07 3.83 3.51 3.51
Pak Oilfields POL 615.06 445.00 Sell 40.92 61.32 69.91 15.03 10.03 8.80 4.62 4.21 3.83 6.50 8.45 9.67
Pakistan Petroleum PPL 201.56 239.00 Accumulate 18.10 21.40 25.93 11.14 9.42 7.77 1.84 1.64 1.45 4.47 4.47 5.21
Hascol Petroleum HASCOL 222.91 325.95 Buy 13.02 18.43 23.50 17.13 12.10 9.49 4.35 3.73 3.21 3.81 5.38 7.40
Attock Petroleum APL 509.23 745.14 Buy 65.27 75.54 91.87 7.80 6.74 5.54 2.74 2.61 2.46 8.35 12.92 15.71
Pakistan State Oil PSO 277.77 413.28 Buy 55.90 64.33 78.14 4.97 4.32 3.55 0.88 0.79 0.70 7.50 9.72 10.80
Power
Hub Power Co. HUBC 93.76 142.70 Buy 11.20 12.42 12.37 8.37 7.55 7.58 3.54 3.47 3.59 8.00 11.74 11.47
K-Electric Co. KEL 6.15 UR UR UR UR UR UR UR UR UR UR UR UR UR UR
Kot Addu Power Company KAPCO 53.93 85.00 Buy 10.84 11.40 11.39 4.97 4.73 4.74 1.48 1.41 1.36 16.78 18.08 18.08
Fixed Line Telecommunication
Pakistan Telecommunication PTC 12.26 UR UR UR UR UR UR UR UR UR UR UR UR UR UR
Personal Goods
Nishat Mills NML 142.13 163.10 Accumulate 12.12 15.48 18.09 11.72 9.18 7.86 0.56 0.54 0.52 3.52 4.93 5.80
Nishat Chunian Ltd. NCL 46.29 69.26 Buy 6.75 9.55 10.66 6.86 4.85 4.34 0.93 0.82 0.73 5.94 8.10 9.18
Banks
Allied Bank Limited ABL 78.51 101.44 Buy 11.95 13.01 14.62 6.57 6.03 5.37 0.84 0.79 0.74 9.55 10.19 11.46
Bank AlFalah BAFL 39.32 48.43 Buy 5.33 5.44 5.98 7.38 7.23 6.58 0.96 0.83 0.74 - 2.52 3.79
Habib Bank Limited HBL 158.63 253.08 Buy 22.13 24.11 26.29 7.17 6.58 6.03 1.10 1.02 0.94 8.83 8.83 8.83
MCB Bank Limited MCB 196.64 241.36 Buy 21.08 22.41 25.04 9.33 8.77 7.85 1.39 1.31 1.25 8.13 8.13 8.64
National Bank of Pakistan NBP 43.57 73.67 Buy 8.59 10.12 12.74 5.07 4.30 3.42 0.49 0.47 0.44 16.07 17.21 19.51
United Bank Ltd UBL 164.99 238.61 Buy 20.52 22.40 25.00 8.04 7.37 6.60 1.17 1.11 1.04 7.88 7.88 7.88
8
AKD Securities Limited
15 December 2017
StockSmart
Pakistan Weekly Update
AKD Universe Coverage Cluster’s Performance
Source: PSX & AKD Research
Stoc ks Symbol Pric e 1 Ye a r 1 Ye a r
15 - De c - 17 1M 3 M 6 M 12 M CYTD High Low
KSE- 10 0 Inde x 3 8 ,6 4 5 .9 0 - 5 .0 - 9 .7 - 18 .5 - 16 .6 - 19 .2 52,876.5 38,223.6
Automobile a nd Pa rts
Indus Motors INDU 1680.91 - 4.5 - 4.6 - 14.1 5.0 4.1 2044.30 1574.18
Pak Suzuki Motors PSMC 472.35 - 9.8 2.4 - 41.1 - 15.4 - 22.9 903.91 436.74
Ce me nts
DG Khan Cement DGKC 123.17 - 12.2 - 20.6 - 44.2 - 42.9 - 44.5 245.37 118.09
Lucky Cement LUCK 454.81 - 12.2 - 25.9 - 44.6 - 46.2 - 47.5 994.65 454.81
Maple Leaf Cement Factory MLCF 66.14 - 5.4 - 24.2 - 38.6 - 45.2 - 48.2 137.64 64.91
Fauji Cement Company Ltd. FCCL 22.81 - 20.6 - 33.4 - 46.6 - 45.5 - 49.4 48.19 22.02
Pioneer Cement Limited PIOC 53.49 - 14.6 - 42.9 - 60.3 - 61.6 - 62.4 160.02 53.49
Cherat Cement Limited CHCC 90.90 - 9.6 - 28.9 - 47.8 - 46.9 - 47.8 212.00 88.73
Gharibwal Cement Limited GWLC 22.10 - 6.2 - 38.5 - 56.6 - 57.0 - 55.8 67.48 21.75
Engine e ring
Amreli Steel Ltd ASTL 84.65 - 11.2 - 15.8 - 33.6 23.4 27.1 137.97 65.52
Fe rtilize rs
Dawood Hercules DAWH 112.51 - 5.1 - 3.0 - 15.4 - 20.3 - 22.0 161.23 105.45
Engro Fertilizers Ltd. EFERT 64.48 - 2.7 10.6 16.3 19.6 - 5.1 73.28 51.90
Engro Chemical ENGRO 268.66 1.1 - 14.7 - 20.0 - 13.1 - 15.0 399.16 253.43
Fatima Fertilizer FATIMA 28.25 - 10.0 - 2.4 - 12.5 - 20.3 - 23.4 41.29 26.83
Fauji Fert. Bin Qasim Ltd. FFBL 33.15 - 2.5 - 5.3 - 21.1 - 36.0 - 35.3 58.41 32.17
Fauji Fertilizer Company FFC 75.46 - 8.0 1.6 - 16.2 - 27.4 - 27.7 118.96 70.07
Food Produc e rs
Engro Foods Limited EFOODS 71.01 - 17.3 - 28.7 - 46.8 - 57.3 - 63.0 207.82 71.01
Oil & Ga s
Oil & Gas Development Co. OGDC 156.70 2.3 2.9 7.4 - 5.6 - 5.2 188.71 133.69
Pak Oilfields POL 615.06 0.4 24.1 30.3 13.6 15.0 640.28 429.75
Pakistan Petroleum Ltd. PPL 201.56 5.8 13.2 28.2 8.2 7.1 201.94 143.73
Pakistan State Oil PSO 277.77 - 20.1 - 37.6 - 31.0 - 32.0 - 36.0 486.05 272.67
Attock Petroleum Ltd. APL 509.23 - 16.2 - 16.4 - 23.5 - 27.8 - 25.6 749.39 509.23
Hascol Petroleum HASCOL 222.91 - 20.9 - 23.7 - 37.7 - 33.2 - 34.0 389.41 222.91
Powe r
Hub Power Co. HUBC 93.76 - 10.3 - 20.0 - 20.6 - 20.5 - 24.1 145.43 91.96
K- Electric Limited KEL 6.15 13.7 - 2.4 - 11.4 - 33.9 - 34.4 10.67 5.34
Kot Addu Power Company KAPCO 53.93 - 19.3 - 27.6 - 26.2 - 28.8 - 31.6 85.02 49.39
Fixe d Line Te le c ommunic a tion
Pakistan Telecommunication PTC 12.26 - 3.6 - 11.2 - 18.8 - 29.8 - 28.6 19.45 11.92
Pe rsona l Goods
Nisaht (Chunian) Ltd. NCL 46.29 1.8 - 10.2 - 12.7 - 23.3 - 25.9 72.67 44.03
Nishat Mills NML 142.13 - 3.3 - 4.0 - 5.1 - 8.8 - 6.7 185.63 130.03
Ba nks
Allied Bank Limited ABL 78.51 - 4.2 - 8.7 - 14.4 - 29.3 - 34.1 122.00 77.50
Bank AlFalah BAFL 39.32 - 2.3 - 5.2 - 2.9 10.9 3.6 47.24 35.32
Habib Bank Limited HBL 158.63 - 4.4 - 18.9 - 40.6 - 36.4 - 41.9 308.57 152.41
MCB Bank Limited MCB 196.64 - 3.0 - 3.6 - 5.2 - 17.4 - 17.3 262.10 190.43
National Bank of Pakistan NBP 43.57 - 3.8 - 26.3 - 33.5 - 40.7 - 41.8 82.66 43.01
United Bank Ltd UBL 164.99 - 3.6 - 13.0 - 26.8 - 28.4 - 30.9 275.38 163.40
Absolute Pe rforma nc e (%)
9
AKD Securities Limited
15 December 2017
StockSmart
Pakistan Weekly Update
Economic Snapshot
Source: SBP, PBS & AKD Research
End Month Data Units Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17
T-bill
3M % 5.85 5.85 5.85 5.85 5.85 5.85 5.85 5.85 5.85 n.a
6M % 5.90 5.90 5.90 5.90 5.90 5.90 5.90 5.90 5.90 n.a
12M % 5.90 5.90 5.90 5.90 5.90 5.90 5.90 5.90 5.91 n.a
PIB 10Y % 8.21 8.17 8.24 8.26 8.21 8.18 8.2 8.23 8.27 n.a
KIBOR 6M % 5.87 5.87 5.88 5.91 5.90 5.90 5.89 5.90 5.91 5.91
Discount rate % 6.25 6.25 6.25 6.25 6.25 6.25 6.25 6.25 6.25 6.25
Policy rate % 5.75 5.75 5.75 5.75 5.75 5.75 5.75 5.75 5.75 5.75
Inflation
Headline inflation % 3.66 4.22 4.94 4.78 5.00 3.9 2.9 3.4 3.9 3.8
Core inflation % 5.40 5.30 5.30 5.50 5.50 5.5 5.6 5.5 5.4 5.3
Food inflation % 2.60 3.70 5.00 4.40 4.90 2.4 (0.10) 1.3 2.4 2.2
External Indicators
Export (PBS) US$ (mn) 1,780 1,638 1,801 1,805 1,627 1,912 1,631 1,866 1,675 1,888
Import (PBS) US$ (mn) 4,724 4,419 5,009 4,998 5,092 4,534 4,835 4,952 4,473 4,929
Trade Deficit (PBS) US$ (mn) (2,944) (2,781) (3,208) (3,193) (3,465) (2,622) (3,204) (3,086) (2,798) -3,041
Export (SBP) 1,783 1,769 2,061 1,766 1,954 1,865 1,828 2,104 2,194 2,380
Import (SBP) 4,196 4,017 4,305 4,108 4,633 5,054 4,720 4,262 4,712 5,258
Trade Deficit (SBP) (2,413) (2,248) (2,244) (2,342) (2,679) (3,189) (2,892) (2,158) (2,518) (2,878)
Home Remittances US$ (mn) 1,488 1,417 1,694 1,539 1,867 1,840 1,542 1,955
1,294 1,654
Current Account US$ (mn) (1,202) (822) (562) (1,337) (1,651) (1,431) (2,051) (550) (1,097) (1,315)
Banking Sector
Deposits PkR (bn) 10,704 10,730 11,170 11,214 10,993 11,981 11,702 11,651 11,980 11,777
Advances PkR (bn) 5,468 5,477 5,697 5,777 5,936 6,176 6,028 6,035 6,137 6,151
Investments PkR (bn) 7,374 7,467 7,670 7,794 7,849 8,166 7,989 8,145 8,338 8,342
W. A. lending rate % 8.01 7.99 7.89 7.85 7.87 7.86 7.88 7.91 7.83 7.82
W. A. deposit rate % 3.05 3.02 2.99 2.98 2.89 2.84 2.91 2.93 2.93 2.91
Spread rate % 4.96 4.97 4.90 4.87 4.98 5.02 4.97 4.98 4.90 4.90
Public Finance
Tax collection PkR (mn) 223,856 225,486 346,999 249,958 330,957 511,449 n.a n.a n.a n.a
Direct taxes PkR (mn) 81,741 80,019 147,242 78,407 117,084 247,210 n.a n.a n.a n.a
Indirect Taxes PkR (mn) 142,115 145,467 199,757 171,551 213,873 264,239 n.a n.a n.a n.a
Currency
Fx Reserves US$ (mn) 22,242 22,072 21,572 21,019 21,190 21,402 20,223 20,401 19,775 19,583.70
USDPkR - Interbank PkR/USD 104.84 104.84 104.82 104.79 104.84 104.86 105.48 105.38 105.40 105.41
10
AKD Securities Limited StockSmart
Pakistan Weekly Update
DISCLOSURES & DISCLAIMERS
This publication/communication or any portion hereof may not be reprinted, sold or redistributed without the written consent of AKD Securities Limited. AKD Securities Limited has produced this report for private circulation to professional and institutional clients only. The information, opinions and estimates herein are not directed at, or intended for distribution to or use by, any person or entity in any jurisdiction where doing so would be contrary to law or regulation or which would subject AKD Securities Limited to any additional registration or licensing requirement within such jurisdiction. The information and statistical data herein have been obtained from sources we believe to be reliable and complied by our research department in good faith. Such information has not been independently verified and we make no representation or warranty as to its accuracy, completeness or correctness. Any opinions or estimates herein reflect the judgment of AKD Securities Limited at the date of this publication/ communication and are subject to change at any time without notice.
This report is not a solicitation or any offer to buy or sell any of the securities mentioned herein. It is for information purposes only and is not intended to provide professional, investment or any other type of advice or recommendation and does not take into account the particular invest-ment objectives, financial situation or needs of individual recipients. Before acting on any information in this publication/communication, you should consider whether it is suitable for your particular circumstances and, if appropriate, seek professional advice. Neither AKD Securities Limited nor any of its affiliates or any other person connected with the company accepts any liability whatsoever for any direct or consequential loss arising from any use of this report or the information contained therein.
Subject to any applicable laws and regulations, AKD Securities Limited, its affiliates or group companies or individuals connected with AKD Securities Limited may have used the information contained herein before publication and may have positions in, may from time to time pur-chase or sell or have a material interest in any of the securities mentioned or related securities or may currently or in future have or have had a relationship with, or may provide or have provided investment banking, capital markets and/or other services to, the entities referred to herein, their advisors and/or any other connected parties.
AKD Securities Limited (the company) or persons connected with it may from time to time have an investment banking or other relationship, including but not limited to, the participation or investment in commercial banking transaction (including loans) with some or all of the issuers mentioned therein, either for their own account or the account of their customers. Persons connected with the company may provide corporate finance and other services to the issuer of the securities mentioned herein, including the issuance of options on securities mentioned herein or any related investment and may make a purchase and/or sale of the securities or any related investment from time to time in the open market or otherwise, in each case either as principal or agent.
This document is being distributed in the United State solely to "major institutional investors" as defined in Rule 15a-6 under the U.S. Securities Exchange Act of 1934, and may not be furnished to any other person in the United States. Each U.S. person that receives this document by its acceptance hereof represents and agrees that it: is a "major institutional investor", as so defined; and understands the whole document. Any such person wishing to follow-up any of the information should do so by contacting a registered representative of AKD Securities Limited.
The securities discussed in this report may not be eligible for sale in some states in the U.S. or in some countries.
Any recipient, other than a U.S. recipient that wishes further information should contact the company.
This report may not be reproduced, distributed or published, in whole or in part, by any recipient hereof for any purpose.
Analyst Certification We, the AKD Research Team, hereby individually & jointly certify that the views expressed in this research report accurately reflect our personal views about the subject securities and issuers. We also certify that no part of our compensation was, is,or will be, directly or indirectly, related to the specific recommendations or views expressed in this research report. We further certify that we do not have any beneficial holding of the specific securities that we have recommendations on in this report.
AKD Research Team
Analyst Tel no. E-mail Coverage
Umer Pervez +92 111 253 111 (693) [email protected] Executive Director Research & Business Development
Zoya Ahmed +92 111 253 111 (603) [email protected] Banks, Telecoms & Consumers
Ali Asghar Poonawala +92 111 253 111 (646) [email protected] OMCs & Automobiles
Waqas Imdad Ali +92 111 253 111 (634) [email protected] Cements & Fertilizer
M.Daniyal Kanani +92 111 253 111 (602) [email protected] Oil & Gas & Power
Umer Farooq +92 111 253 111 (637) [email protected] Textiles & Steel
Bilal Ahsan Elahi +92 111 253 111 (685) [email protected] Automobiles
Qasim Anwar +92 111 253 111 (680) [email protected] Technical Analysis
Nasir Khan +92 111 253 111 (639) [email protected] Research Production
15 December 2017
