indices kmi- 30 allshare stocksmart pakistan weekly...

AKD Research [email protected]

+92-21-111-253-111

Weekly Review

The KSE-100 index built on the bullish momentum of the previous weeks, supported by con-clusion of IMF’s first review. A staff mission of IMF on 8th Nov’19, Friday concluded its visit to Pakistan with all praise to authorities for over-performing on first quarter targets under the $6 billion Extended Fund Facility, paving way for the disbursement of $450 million early next month. The first session of the week thus closed +825pts, or up 2.29%. In a large move to widen tax net and check evasion, the government also decided to evolve a comprehensive plan for nationwide tax assessment and documentation drive to bring untapped sectors in the net. PM Imran Khan tasked the tax department for coming up with a detailed plan until Nov 30, which will envisage measures to be implemented over the next two years. On local politi-cal front, the JUI-F led Azadi march fizzled out, as JUI-F chief called off the party’s sit-in in Is-lamabad on 13th Nov’19, leading to market rally 401 pts (up 1.09%) during KSE-100’s third trading session. Other major factors building market’s momentum during the week included: (i) pick up in foreign investment in treasury bills (US$267mn during the first two weeks of Nov’19), (ii) SBP’s decision to increase loans for the exporters by Rs100 billion, (iii) allocation of additional Rs250 billion to resolve the problem of circular debts, (iv) tax incentives for the companies involved in construction of houses, (v) allowing manufacturing sector an advance payment of upto $10,000 for import of raw materials and spare parts to spur LSM sector and (vi) trade deficit shrinking by 29/34% YoY in Oct’19/4MFY20. Major data released during the week included auto sales data released by PAMA, which indicated 56% YoY decline in car sales for Oct’19, owed to a slowdown in economy and higher car prices. Top performers in AKD Universe during the week included HASCOL (+27.41%WoW), ASTL (+26.73%WoW), CHCC (+25.02%WoW), PIOC (+21.75%WoW) and GWLC (+17.71%), while FFC (-2.10%), and EFERT (-0.91%) were major laggards. Average daily turnover significantly improved 28%WoW to 311mn shares. BOP (106.03mn shares), PAEL (57.34mn shares), UNITY (56.16mn shares), TRG (54.77mn shares) and FCCL (50.07mn shares) remained major volume churners.

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©2019 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-019

Find AKD research on Bloomberg

(AKDS<GO>), firstcall.com and Reuters Knowledge

The upcoming week’s sentiment will be shaped by the monetary policy statement (date not announced yet). We expect status quo in the MPS, where weak reserve buffer stands as the major impediment in rate cuts in near term, in our view. Relative calm on the political front amidst positive macro reads (keep an eye on foreign portfolio inflows in debt market & Oct’19 CAD), the market is likely to continue its positive momentum in the weak ahead.

15 November 2019

Outlook

Index & Volume Chart

Source: PSX & AKD Research

Universe Gainers & Losers

36,803 36,766 37,167

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(Index)(Shrs'000)

Ready Volume (LHS) KSE100 Index (RHS)

Top-5 Volume Leaders

Symbol Volume (mn)

BOP : 106.03

PAEL : 57.34

UNITY : 56.16

TRG : 54.77

FCCL : 50.07


Indic e s KSE- 10 0 KSE- 3 0

This week 37,584 17,341

Last week 35,978 16,754

Change 4.46% 3.50%

Indic e s KMI- 3 0 Allsha re

This week 61,221 26,714

Last week 58,944 25,731

3.86% 3.82%

Mkt Ca p. PkRbn US$ bn

This week 7,215 46.43

Last week 6,961 44.77

Avg. Da ily Turnove r ('mn sha re s)

This week 311.17

Last week 242.71

Change 28.2%

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AKD Securities Limited

15 November 2019

StockSmart


This Week’s Daily Reports

2

Pakistan Autos: Shying away from major model upgrades, (AKD Daily, Nov 15, 2019)

An analysis of updated financial accounts for auto OEMs now indicates a “cooling-off” of indus-try CAPEX with the last trailing twelve month (TTM) total outlay reaching PkR13.6bn, down 6.4%QoQ with PSMC/INDU/HCAR contributing 24/70/6%, as slowing demand dynamics ham-per/delay new product launches and OEMs revert back to maintenance CAPEX levels

The industry’s TTM topline/gross profit levels have receded 5.2/40.4%YoY showcasing persis-tent strains on core profitability (two consecutive quarters of declining sales), where players dealt with FX fluctuations drastically hiking retail prices coinciding with a period of demand weakness (monetary tightening, inflationary pressures, lower disposable incomes)

In terms of cash flows, net working capital outflows remain a sap on operating cash flows. While slowing CAPEX helps in reducing outflows, OEMs may be revisiting the case for adding leverage to their balance sheets, a trend initiated by PSMC (ST borrowing of PkR21.3bn as of Sept’19, up PkR14.2bnQoQ). That said, as long as major OEMs remain profitable and CAPEX reverts back to maintenance levels, leverage could be avoided.

Backed by our conversations with industry participants, we put forward a conservative outlook for demand, with little room available to spur demand from new model launches. In this case, we believe any cost de-escalations or significant discounting by OEMs could drive demand. Barring that, only a new variant launch with attractive mix of features and pricing could turn the industry back to a path of growing profitability.

Pakistan Commodities: Slowing growth is the new normal, (AKD Daily, Nov 14, 2019)

Global growth seems to have plateaued, as indicated by contractions in global manufacturing PMI and softening consumer confidence, where sentiments now driving global commodities seem to be focused on geopolitical developments, global central banks and FX swings (Dollar index slipped 1.9%MoM) have consolidated commodity price benchmarks (TRJ index +3.6%MoM)

Almost all major commodity prices we track were higher MoM, with precious metals continu-ing their north-bound moves and other hard commodities edging higher, while energy prices followed a similar trend higher (Brent/Arab Light 3.7/1.8%MoM) where Coal prices recovered from the CYTD downward slide (up 8.4%MoM but down 29.5%CYTD)

FAO food price index and the Cotlook benchmark was higher for the outgoing month, where dissipating trade tensions and lower production prospects dented supply expectations, driving prices higher.

In terms of corporate profitability, lower commodity prices offer some relief in an otherwise tough operational environment, where some strength in the PkR vs. US$ (-0.6%MoM) comes as a welcome relief. Positive outcome of US China trade talks (including tangible confidence building measures), and global central banks implementing harmonious easing program could spur industrial activity in-turn driving commodity prices higher.

Pakistan Autos: High-base intensifies Oct’19 slowdown, (AKD Daily, Nov 13, 2019)

Total automotive industry sales fell -7%MoM/-56%YoY during Oct’19, amounting to just 11,231 units, where constituents of total industry sales moved -12%/+52%/+4%/+75%/-24%MoM for Passenger Cars/LCVs/Trucks/Buses/Tractors, where passenger car and LCV sales slipped passes their 7th consecutive month of YoY declines

Cumulative 10MCY19 sales decline of 25.5%YoY was an offshoot of Passenger Car/LCVs/Trucks slipping 23.4%/32.7%/49.2%YoY, while in terms of car segments 800cc+/1000CC/1300CC+ sales moved -14.3/-19.1/-30.8%YoY, as hefty price tag hikes and lack of new variants in the premium category kept customers in ‘sticker-shock’ while relatively nascent lower-end variants exhibited relative strength

Amongst major OEMs, PSMC/INDU/HCAR had relatively tough month with sales down 48/61/72%YoY as they compare feebly to a high-watermark established in Oct’18, while cumu-lative 10MCY19 figures remain firmly in the red as well with sales down 19/23/43%YoY

Citing drastic decline in sales led by sticky cost centers, 1QFY20 results for INDU were highly

Nov 15, 2019

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15 November 2019

StockSmart


This Week’s Daily Reports

3

reflective of the terse operational environment currently at play for the industry and INDU. Based on sales for FY20 showcasing decline of ~59%YoY (underpinned by ~60%YoY fall in Corolla sales to ~23K vehicles), we have pruned our EPS to PkR77.0.

Pakistan Energy Another day, Another debt settlement Part II,(AKD Daily, Nov 12, 2019)

Apropos our previously published note (Another day, Another debt settlement) we layout a comprehensive framework for another Energy Sukuk issue, reportedly at PkR250bn, requir-ing clearance from the IMF for raising sovereign guarantees threshold from current PkR1.6trn.

As opposed to Energy Sukuk I, we expect a higher amount i.e. PkR65-70bn to be routed towards IPPs in the second tranche of Sukuk. Payout potential is dependent on capacity payments received by each IPP, as energy payments will likely be directed towards PSO and SNGP, where we highlight KAPCO (low payables to PSO and SNGP) and NPL (least leveraged) as more likely to resume payout.

With a higher current liabilities, HUBC can be expected to divert the settlement amount towards retiring short term debt and CAPEX, leaving little room for payouts, in our view. Despite high D/A of KAPCO, low payables to PSO/SNGP leave some space for payouts .

We expect PSO, sole beneficiary from OMC sector, to receive PkR45bn from the next tranche of circular debt clearance, aiding the company in repaying the FE-25 borrowing while also providing room to move forward with planned capital expenditures.

Pakistan OMCs: Much ado about margins, (AKD Daily, Nov 11, 2019)

After a delay of five months, Economic Coordination Committee (ECC) finally accorded ap-proval to revision in OMC margins, setting them at PkR2.81/liter for MS and HSD for rest of FY20 (effective Dec’19) — increasing by 6.4%.

Margin revision did not compensate OMCs for the delay where we had already incorporated margins of PkR2.77/liter for FY20 vs. now applicable weighted average margins of PkR2.74 resting lower than our estimates, pruning earnings of PSO/APL by 1.5/1% (avg. FY20-22).

Though chances of passing the proposal for incorporation of exchange losses into the pricing mechanism remain slim (inflationary in nature), in case it does, we flag their incorporation as a material positive for HASCOL as the company imports significant portion of its products.

PSO’s exposure to exchange rate movement is expected to increase post repayment/curtailment of FE-25 borrowings (at 18bn in Sept’19 vs. 62bn in June’19) as the GoP covers adverse exchange movements on loans arising on the facility. While, APL remains a safe bet with refinery upliftment standing at 69%.

We maintain APL (TP: Pk369/sh, Buy) as our preferred play from the sector as unleveraged balance sheet protects the profitability from high interest rates while strong dealer network in North works as a shield against smuggling of HSD.


15 November 2019

StockSmart


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 (2019)

Source: AKD Research & Bloomberg

129.0

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SPOT Units 15-Nov-19 8-Nov-19 WoW CYTD

TRJ-CRB Points 180.0875 181.275 -0.66% 6.06%

Nymex (WTI) US$/bbl. 56.71 57.24 -0.93% 24.88%

ICE Brent US$/bbl. 62.63 62.97 -0.54% 17.79%

N. Gas Henry Hub US$/Mmbtu 2.68 2.87 -6.62% -15.92%

Cotton USd/Pound 74.9 75.4 -0.66% -7.30%

Gold US$/Tr.Oz 1465.52 1458.92 0.45% 14.28%

Sliver US$/Tr.Oz 16.88 16.793 0.52% 8.94%

Copper US$/MT 5787.75 5910.75 -2.08% -2.71%

Platinum US$/Oz 881.35 887.1 -0.65% 10.77%

Coal US$/MT 70.9 69.05 2.68% -26.41%

SPOT 15-Nov-19 8-Nov-19 Chg +/- WoW CYTD

Dollar Index 98.145 98.353 -0.208 -0.21% 2.05%

USD/PkR 155.375 155.685 -0.310 -0.20% 11.89%

USD/JPY 108.690 109.260 -0.570 -0.52% -0.91%

EUR/USD 1.103 1.102 0.001 0.12% -3.80%

GBP/USD 1.288 1.277 0.011 0.85% 1.00%

AUD/USD 0.680 0.686 -0.007 -0.95% -3.56%

NZD/USD 0.639 0.633 0.006 0.98% -4.90%

CHF/USD 0.990 0.997 -0.007 -0.75% 0.79%

CAD/USD 1.324 1.323 0.001 0.10% -2.90%

USD/KRW 1,167 1,157 9.350 0.81% 4.56%

CNY/USD 7.010 6.996 0.014 0.20% 1.91%

Country Bloomberg Code 15-Nov-19 8-Nov-19 WoW CYTD

Pakistan KSE100 Index 37,584 35,978 4.46% 1.4%

Srilanka CSEALL Index 6,023 5,955 1.15% -0.5%

Thailand SET Index 1,602 1,638 -2.17% 2.5%

Indonesia JCI Index 6,128 6,178 -0.80% -1.1%

Malaysia FBMKLCI Index 1,595 1,610 -0.93% -5.7%

Philippines PCOMP Index 7,933 8,066 -1.65% 6.3%

Vietnam VNINDEX Index 1,010 1,022 -1.22% 13.2%

Hong Kong HSI Index 26,327 27,651 -4.79% 1.9%

Singapore FSSTI Index 3,239 3,264 -0.78% 5.5%

Brazil IBX Index 44,658 45,075 -0.93% 22.4%

India SENSEX Index 40,357 40,324 0.08% 11.9%

S&P SPX Index 3,097 3,093 0.11% 23.5%

DJIA INDU Index 27,782 27,681 0.36% 19.1%

UK UKX Index 7,255 7,359 -1.41% 7.8%

Germany DAX Index 13,202 13,229 -0.20% 25.0%

Qatar DSM Index 10,363 10,275 0.86% 0.6%

Abu Dhabi ADSMI Index 5,138 5,131 0.12% 4.5%

Dubai DFMGI Index 2,701 2,699 0.10% 6.8%

Kuwait KWSEIDX Index 6,633 6,633 0.00% 0.0%

Oman MSM30 Index 4,084 4,041 1.07% -5.5%

Saudi Arabia SASEIDX Index 7,924 7,798 1.61% 1.2%

MSCI EM MXEF Index 1,042 1,065 -2.12% 7.9%

MSCI FM MXFM Index 560 558 0.40% 8.5%

EPS Growth PE(x)

Pakistan 17.54% 6.73

Indonesia 11.35% 15.27

Malaysia 12.59% 14.14

Philippines 6.42% 15.70

Vitenam 10.27% 15.53

India 22.67% 17.87

China 10.16% 10.44

% ROE Divd Yld

Pakistan 16.2% 9.31

Indonesia 13.89 2.37

Malaysia 8.93 3.67

Philippines 11.46 1.72

Vitenam 17.01 1.93

India 14.37 1.67

China 11.70 2.87

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15 November 2019

StockSmart


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

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MSCI EM

MSCI FM

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(%)

Ind., 16.80

Co., 2.98

Bank/DFI, (18.79)

NBFC, 0.47

M.Funds, 7.95

Ins, (9.16)

Others, (1.89)Prop. Trading ,

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KSE-All Share Index AKD Univ erse

6

AKD Securities Limited StockSmart


Market PER Chart 2020

15 November 2019

AKD Universe Valuations

Source: AKD Research

Market P/BVS Chart 2020

Source: AKD Research

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15-Nov-19 2016 2017 2018F 2019F 2020F

EPS (PkR) 7.19 6.22 6.72 7.78 9.25

EPS chg (%) 2.39 (13.55) 8.09 15.81 18.86

EPS chg (%) ex-E&P 17.90 (22.96) 2.27 6.35 26.46

Book Value per Share (PkR) 41.15 43.99 46.58 50.85 55.80

Payout (%) 50.96 55.63 50.48 46.70 49.34

Valuations

Price to Earnings (x) 6.74 8.76 8.24 7.45 6.73

PER (Ex-Banks & E&Ps) (x) 5.51 8.07 7.41 7.96 7.15

Price to Book (x) 1.30 1.22 1.16 1.07 0.97

Price to CF (x) 9.80 11.15 9.13 10.42 6.04

Earnings Yield (%) 14.85 11.42 12.13 13.43 14.86

Dividend Yield (%) 7.62 6.96 6.36 6.73 8.25

EV / EBITDA (x) 6.15 6.37 6.35 5.49 4.76

Profitability

Return on Equity (%) 17.48 14.14 14.43 15.31 16.58

Return on Assets (%) 3.18 2.36 2.41 2.67 2.82

Chg in Sales (%) (14.92) 16.29 18.23 17.01 13.84

Gross Margin (%) 34.39 35.77 34.52 33.94 33.20

Operating Margin (%) 22.38 24.45 23.89 23.76 23.38

Net Margin (%) 15.56 11.57 10.57 10.47 10.93

7



AKD Universe Active Coverage Cluster’s Valuations

15 November 2019

Source: AKD Research UR Under Review

Stock Symbol Price TP Stance EPS(PkR) PE(x) PB(x) DY(%)

(PkR) (PkR) 18 19F 20F 18 19F 20F 18 19F 20F 18 19F 20F

Automobile and Parts

Indus Motors INDU 1,199.46 1,452.06 Buy 200.66 174.49 180.17 5.98 6.87 6.66 2.57 2.30 2.07 11.67 9.59 10.06

Pak Suzuki Motors PSMC 196.63 275.08 Buy 15.77 4.33 21.14 12.47 45.44 9.30 0.55 0.55 0.52 - 0.51 2.54

Cements

DG Khan Cement DGKC 70.97 53.20 Sell 20.17 6.86 (0.06) 3.52 10.34 n.a 0.40 0.40 0.40 5.99 0.14 0.00

Lucky Cement LUCK 388.82 516.54 Buy 37.72 32.44 24.75 10.31 11.99 15.71 1.46 1.33 1.25 3.34 1.67 1.41

Maple Leaf Cement Factory MLCF 20.03 22.90 Buy 6.12 4.14 (0.25) 3.27 4.84 n.a 0.40 0.38 0.39 12.48 2.50 0.00

Fauji Cement Company Ltd. FCCL 16.37 15.09 Neutral 2.49 2.05 0.99 6.59 8.00 16.61 1.10 1.08 1.07 11.01 9.16 4.44

Pioneer Cement Limited PIOC 31.24 17.30 Sell 7.24 4.46 7.82 4.32 7.00 3.99 0.52 0.51 0.46 13.03 - 5.01

Cherat Cement Co Limited CHCC 52.12 23.60 Sell 12.07 9.98 (3.61) 4.32 5.22 n.a 0.82 0.76 0.83 9.59 1.92 -

Gharibwal Cement Ltd GWLC 11.63 25.00 Buy 3.77 2.70 3.69 3.08 4.31 3.15 0.37 0.37 0.35 12.90 4.30 19.35

Engineering

Amreli Steels Ltd. ASTL 40.20 41.00 Sell 5.34 0.11 5.00 7.53 363.77 8.04 0.93 0.98 0.97 5.47 - -

Fertilizers

Engro Corporation ENGRO 328.39 321.56 Neutral 24.28 39.68 51.30 13.53 8.28 6.40 1.03 0.92 0.79 0.58 8.58 8.58

Engro Fertilizers Limited EFERT 70.47 68.56 Sell 13.04 9.25 10.41 5.40 7.62 6.77 2.07 2.11 2.09 15.61 14.19 14.19

Fauji Fert. Bin Qasim Ltd. FFBL 20.90 31.34 Buy 1.54 (1.63) 1.24 13.59 n.a 16.85 1.40 1.58 1.53 4.78 - 3.83

Fauji Fertilizer Company FFC 95.76 116.45 Buy 11.35 13.87 15.22 8.44 6.91 6.29 3.65 3.29 2.96 9.24 11.49 12.53

Fatima Fertilizer FATIMA 27.00 36.68 Buy 6.24 8.88 7.29 4.33 3.04 3.70 0.91 0.75 0.66 6.48 8.89 9.81

Food Producers

Engro Foods Limited EFOODS 72.55 80.87 Neutral 0.08 1.22 1.37 871.97 59.31 53.11 2.84 2.66 2.55 - - -

Oil & Gas

Oil & Gas Development Co. OGDC 133.94 215.00 Buy 18.31 27.53 29.71 7.31 4.87 4.51 1.05 0.92 0.85 7.47 8.21 8.96

Pak Oilfields POL 413.18 450.00 Neutral 40.10 59.44 67.43 10.30 6.95 6.13 3.58 3.28 2.90 8.57 12.10 13.07

Pakistan Petroleum PPL 122.08 208.00 Buy 23.17 23.10 21.72 5.27 5.28 5.62 1.15 1.04 0.95 3.92 1.64 10.36

Hascol Petroleum HASCOL 49.60 UR UR UR UR UR UR UR UR UR UR UR UR UR UR

Attock Petroleum APL 343.64 479.57 Buy 56.83 39.79 55.97 6.05 8.64 6.14 1.86 1.75 1.61 11.64 8.15 11.46

Pakistan State Oil PSO 174.61 195.80 Buy 32.93 22.55 24.37 5.30 7.74 7.17 0.74 0.69 0.65 7.16 4.78 4.78

Power

Hub Power Co. HUBC 82.69 139.96 Buy 9.56 9.37 15.99 8.65 8.83 5.17 3.37 2.45 2.04 7.98 - 2.42

K-Electric Co. KEL 4.10 UR UR UR UR UR UR UR UR UR UR UR UR UR UR

Kot Addu Power Company KAPCO 34.57 41.93 Buy 12.06 10.90 10.52 2.87 3.17 3.28 0.87 0.83 0.81 26.47 13.02 27.48

Cable & Electrical Goods

Pak Elektron Ltd PAEL 22.42 18.30 Sell 2.76 (1.16) 0.58 8.14 n.a 28.55 0.37 0.37 0.38 - 2.43 4.86

Personal Goods

Nishat Mills NML 98.26 158.00 Buy 11.65 16.66 14.92 8.43 5.90 6.59 0.46 0.44 0.42 4.83 4.07 6.11

Nishat Chunian Ltd. NCL 37.05 55.00 Buy 9.84 9.30 7.11 3.77 3.98 5.21 0.65 0.59 0.56 10.80 10.80 8.10

Banks

Allied Bank Limited ABL 90.37 118.50 Buy 11.08 15.45 20.55 8.16 5.85 4.40 0.93 0.87 0.79 8.85 9.40 12.51

Bank Al Habib BAHL 75.51 97.64 Buy 7.61 9.53 11.94 9.93 7.92 6.33 1.68 1.48 1.25 3.31 5.30 7.28

Bank AlFalah BAFL 44.59 51.30 Buy 5.99 7.69 9.07 7.44 5.80 4.92 1.03 0.91 0.79 5.60 6.73 6.73

Habib Bank Limited HBL 141.77 140.47 Neutral 8.22 11.06 23.22 17.25 12.82 6.10 1.04 0.95 0.85 3.00 3.53 4.94

Habib Metropolitn Bank HMB 34.25 43.81 Buy 5.88 6.92 8.34 5.82 4.95 4.11 0.89 0.80 0.68 5.84 7.07 8.52

MCB Bank Limited MCB 191.31 224.73 Buy 18.02 20.37 26.35 10.62 9.39 7.26 1.49 1.41 1.30 8.36 8.36 9.41

Meezan Bank Limited MEBL 84.57 115.80 Buy 6.96 9.66 12.08 12.14 8.75 7.00 2.56 2.17 1.82 3.76 4.09 6.13

National Bank of Pakistan NBP 39.23 66.51 Buy 9.42 7.14 12.27 4.17 5.49 3.20 0.44 0.45 0.42 - 17.84 20.39

United Bank Ltd UBL 147.73 154.60 Buy 12.29 21.52 31.28 12.02 6.86 4.72 1.02 0.92 0.79 7.45 7.45 8.12

8


15 November 2019

StockSmart


AKD Universe Coverage Cluster’s Performance


Stoc ks Symbol Pric e 1 Ye a r 1 Ye a r

15 - Nov- 19 1M 3 M 6 M 12 M CYTD High Low

KSE- 10 0 Inde x 3 7 ,5 8 3 .8 9 10 .3 2 7 .7 9 .6 - 9 .3 1.4 4 1,6 6 0 .8 2 8 ,7 6 4 .6

Automobile a nd Pa rts

Indus Motors INDU 1,199.46 21.2 19.9 - 0.6 - 13.7 - 1.7 1390.50 924.49

Pak Suzuki Motors PSMC 196.63 19.1 25.4 - 16.4 - 20.8 12.9 340.41 148.79

Ce me nts

DG Khan Cement DGKC 70.97 23.0 54.0 19.9 - 36.0 - 11.5 110.84 42.31

Lucky Cement LUCK 388.82 4.6 12.2 8.0 - 21.8 - 10.5 532.44 338.70

Maple Leaf Cement Factory MLCF 20.03 15.1 11.0 - 6.1 - 62.2 - 50.7 52.94 13.79

Fauji Cement Company Ltd. FCCL 16.37 6.5 23.2 - 2.9 - 36.5 - 21.8 25.77 12.48

Pioneer Cement Limited PIOC 31.24 25.8 75.4 49.0 - 41.1 - 25.5 54.64 17.37

Cherat Cement Limited CHCC 52.12 60.1 105.3 40.3 - 34.5 - 25.2 91.22 24.78

Gharibwal Cement Limited GWLC 11.63 16.3 41.5 12.2 - 39.0 - 26.4 19.16 8.19

Engine e ring

Amreli Steel Ltd ASTL 40.20 49.8 145.0 70.7 - 38.4 - 16.0 65.30 15.83

Fe rtilize rs

Engro Fertilizers Ltd. EFERT 70.47 2.5 12.0 4.7 30.7 2.1 78.36 61.99

Engro Chemical ENGRO 328.39 18.3 38.9 24.7 - 1.6 12.8 339.80 234.78

Fatima Fertilizer FATIMA 27.00 3.8 7.1 3.8 - 22.8 - 26.0 36.55 24.26

Fauji Fert. Bin Qasim Ltd. FFBL 20.90 12.9 37.1 - 7.1 - 50.8 - 43.9 43.57 14.39

Fauji Fertilizer Company FFC 95.76 0.5 2.4 3.9 - 4.0 3.1 109.12 84.88

Food Produc e rs

Engro Foods Limited EFOODS 72.55 38.6 58.4 48.9 - 15.2 - 9.0 92.45 43.98

Ca ble & Ele c tric a l Goods

Pak Elektron Limited PAEL 22.42 16.0 53.0 5.9 - 32.7 - 10.0 33.31 14.32

Oil & Ga s

Oil & Gas Development Co. OGDC 133.94 4.1 19.6 - 2.0 - 9.7 4.6 154.19 104.56

Pak Oilfields POL 413.18 7.7 13.6 4.1 - 18.5 - 2.7 523.35 352.30

Pakistan Petroleum Ltd. PPL 122.08 - 10.4 7.7 - 26.9 - 28.8 - 18.4 193.79 103.40

Pakistan State Oil PSO 174.61 - 0.1 31.3 5.1 - 35.2 - 22.5 281.26 124.54

Attock Petroleum Ltd. APL 343.64 16.2 40.3 17.8 - 31.7 - 20.4 510.27 240.05

Hascol Petroleum HASCOL 49.60 72.6 27.9 - 30.2 - 77.5 - 66.6 221.87 20.31

Powe r

Hub Power Co. HUBC 82.69 9.9 31.8 11.5 - 12.1 - 3.6 95.65 62.50

K- Electric Limited KEL 4.10 3.0 34.4 - 2.8 - 30.6 - 31.0 6.68 3.04

Kot Addu Power Company KAPCO 34.57 0.8 16.2 - 8.8 - 34.5 - 30.2 53.33 27.73

Pe rsona l Goods

Nisaht (Chunian) Ltd. NCL 37.05 - 0.9 35.2 - 10.7 - 41.2 - 23.7 62.97 25.51

Nishat Mills NML 98.26 9.4 47.6 - 10.8 - 35.3 - 22.3 152.03 66.55

Ba nks

Allied Bank Limited ABL 90.37 2.5 5.1 - 16.4 - 15.1 - 15.9 112.81 82.64

Bank AlHabib Limited BAHL 75.51 8.5 10.8 - 4.1 1.2 9.8 87.06 64.00

Bank AlFalah BAFL 44.59 1.9 22.2 - 0.5 - 12.6 9.9 51.00 36.50

Habib Bank Limited HBL 141.77 6.2 33.5 16.0 - 3.0 17.7 151.43 106.17

Habib Metropolitan Bank HMB 34.25 8.4 11.2 - 9.7 - 19.7 - 25.2 46.00 28.95

MCB Bank Limited MCB 191.31 12.2 23.2 7.3 - 5.0 - 1.2 212.51 154.04

Meezan Bank Limited MEBL 84.57 4.5 12.6 - 0.5 - 9.3 - 8.5 103.59 69.20

National Bank of Pakistan NBP 39.23 16.5 35.9 4.9 - 20.4 - 6.7 50.16 28.58

United Bank Ltd UBL 147.73 0.7 19.8 0.3 7.2 20.5 158.82 121.11

Absolute Pe rforma nc e (%)

9


15 November 2019

StockSmart


Economic Snapshot

Source: SBP, PBS & AKD Research

End Month Data Units Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Jul-19 Aug-19

Monetary Rates

T-Bills - 3M % 7.73 7.73 8.73 8.73 10.19 10.29 10.45 10.45 10.84 11.54 12.39 12.93 13.43

T-Bills - 6M % 7.84 7.84 8.84 8.84 10.28 10.44 10.6 10.6 11 11.68 12.46 12.98 13.48

T-Bills - 12M % 8.05 8.05 9.05 9.05 10.42 10.68 10.78 10.78 11.1 11.81 12.6 13.1 13.6

PIB 10Y % 9.93 10.02 11.53 12.16 12.89 13.18 13.35 13.35 13.06 13.5 13.68 13.67 13.29

KIBOR 6M % 7.79 8.17 9.43 9.62 10.66 10.76 10.85 10.9 10.99 11.92 12.86 13.3 13.82

Discount rate % 8.00 9.0 9.0 10.5 10.5 10.75 10.75 11.25 11.25 12.75 13.75 13.75 13.75

Policy rate % 7.50 8.5 8.5 10 10 10.25 10.25 10.75 10.75 12.25 13.25 13.25 13.25

Inflation

Headline inflation % 5.8 5.1 6.8 6.5 6.2 7.2 8.2 9.4 8.8 9.1 8.9 10.3 11.6

Core inflation % 7.7 8.00 8.20 8.3 8.4 8.7 8.8 8.5 7.0 7.2 7.2 7.8 8.2

Food inflation % 3.3 1.4 2.7 1.8 0.9 2.4 5.0 8.4 8.6 8.7 8.2 9.2 11.9

External Indicators

Export (PBS) US$ (mn) 2,017 1,728 1,903 1,843 2,080 2,043 1,889 1,979 2,094 2,102 1,717

1,894

1,859

Import (PBS) US$ (mn) 4,992 4,430 4,841 4,626 4,444 4,504 4,180 4,155 4,753 5,042 4364 4019 3658

Trade Deficit (PBS) US$ (mn) (2,975) (2,702) (2,938) (2,783) (2,364) (2,461) (2,291) (2,176) (2,659) (2,940) (2,647)

(2,125)

(1,799)

Export (SBP) 2087 1801 2063 1893 2,004 2,272 1,862 2,026 2,079 2,318 1800 2228 1914

Import (SBP) 4,460 3,792 4,717 4,184 4,578 4,403 3,440 4,121 4,182 4,381 3997 4182 3522

Trade Deficit (SBP) (2,373) (1,991) (2,654) (2,291) (2,574) (2,131) (1,578) (2,095) (2,103) (2,063) (2,197)

(1,954)

(1,608)

Home Remittances US$ (mn) 2,089 1,486 2,060 1,664 1,749 1,743 1,577 1,746 1,779 2,316 1,646 2,039 1,691

Current Account US$ (mn) (600) (909) (1,218) (1,209) (1,660) -873 -356 (822) (1,244) (1,089) (995)

(678)

(614)

Banking Sector

Deposits PkR (bn) 12,692 13,032 12,666 13,079 13,354 13,058 12,805 13,456 13,149 13,460 14,458 13,747 n.a

Advances PkR (bn) 7,426 7,492 7,534 7,750 7,888 7,841 7,884 7,889 7,860 8,022 8,097 7,991 n.a

Investments PkR (bn) 6,893 6,677 5,525 5,459 7,583 5,223 7,498 5,751 6,230 7,300 7,624 n.a n.a

W. A. lending rate % 8.27 8.33 8.87 9.07 9.66 10.20 10.46 10.99 11.19 11.39 11.87 n.a n.a

W. A. deposit rate % 3.44 3.51 3.84 3.92 4.46 4.78 4.96 5.00 5.81 5.34 5.71 n.a n.a

Spread rate % 4.83 4.82 5.02 5.14 5.20 5.42 5.50 5.99 5.38 6.05 6.16 n.a n.a

Public Finance

Tax collection PkR (bn) 247.40 333.82 268.90 281.80 411.90 273.10 265.00 371.60 277.60 309.40 537.90 - -

Direct taxes PkR (bn) 71.50 133.02 79.40 98.90 191.60 92.10 81.20 155.70 78.50 92.90 276.80 n.a n.a

Indirect Taxes PkR (bn) 175.90 200.80 189.50 182.90 220.30 181.00 183.80 215.90 199.10 216.50 261.10 n.a n.a

Currency

Fx Reserves US$ (mn) 16,370 14,921 14,016 14,011 13,753 14,920 14,951 17,417 15,723 14,882 14,477 15,144 15,644

USDPkR - Interbank PkR/USD 124.08 124.29 130.72 134.03 138.74 138.83 138.62 139.76 141.33 146.17 156.41

159.19

158.24

10



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.

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Any recipient, other than a U.S. recipient that wishes further information should contact the company.

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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

Usman Zahid +92 111 253 111 (693) [email protected] Executive Director Research

Hamza Kamal +92 111 253 111 (634) [email protected] Banking

Ali Asghar Poonawala +92 111 253 111 (646) [email protected] Cable & Electrical, OMCs & Automobiles

Umer Farooq +92 111 253 111 (602) [email protected] Textiles & Steel

Shahrukh Saleem +92 111 253 111 (685) [email protected] Cement Sector

AIlia Naeem +92 111 253 111 (603) [email protected] Fertilizer & Energy

Qasim Anwar +92 111 253 111 (680) [email protected] Technical Analysis

Nasir Khan +92 111 253 111 (639) [email protected] Research Production

Faisal Tufail +92 111 253 111 (647) [email protected] Research Production

Tariq Mehmood +92 111 253 111 (643) [email protected] Library Operations

15 November 2019

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