Karachi Stock Exchange Weekly Analysis 20 July, 2013

The Karachi Stock Exchange (KSE) benchmark movement was volatile which moves up a notch near all time peak. KSE-100 hits new peak amid higher earnings expectations. KSE – 100 index closed at 23,428.93 points by gaining 391.61 points or 1.7 percent. While KSE – 30 index closed at 18,330.01 by gaining  339.91 points or 1.89 percent. However, average daily volumes dropped 18% to 216 million shares this week vs. 263mn shares a week prior. There are some concerns on an early return to monetary tightening later this year, with a further 25bps increase seen in the 10-year PIB yield.

According to analysts, there is hope of good corporate results, and market is likely to continue upward rally next week, but volumes might remain low.

Following news have played vital role in Karachi Stock Market index movement:

  • Results season commencement, rupee’s depreciation and Kot Addu Power Company’s (Kapco) international investors’ divestment plans remained the key highlights of the week
  • The key result announced during the week was that of PTCL, which delivered robust 1H2013 earnings (+15%YoY) alongside a somewhat rare dividend payout of Rs1/share
  • The govt needed to allay concerns of Etisalat on grey trafficking as well as settling the issue of properties in order to release the remaining US$800mn on account of PTCL privatization
  • Pakistan now officially wants US$7.3bn from the IMF
  • The government has restored the zero-rated General Sales Tax (GST) status on milk and dairy products. FBR has restored sales tax zero‐rating facility for dairy products, stationery items and bicycles along with their raw material, packing material, sub‐components, components, sub‐assemblies and assemblies, imported or purchased locally for manufacture of above mentioned goods
  • Phosacid contract price for 3Q2013 has been finalized at US$715/ton, down US$35/ton
  • Ministry of Water and Power stated that the energy sector would be fixed in 3 years
  • Economic Coordination Committee (ECC) of the Cabinet was expected to consider a proposal to privatize 25%‐30% shares along with management control to a strategic investor of Pakistan International Airlines Corporation (PIAC)
  • The unpaid bills of private power companies — commonly known as circular debt — have again started to pile up in spite of the payment by the government of PKR260bn to clear their outstanding bills up to end March this year 
  • In order to strengthen Shariah compliance framework, the SBP has asked Islamic Banking Industry to adopt the AAOIFI Shariah Standard No 17 on 'Investment Sukuk'
  • Pakistan’s oil production stood at 76.5k bpd during FY13, up by 14% against 67.3k in FY12, data released by PPIS revealed
  • Qatar has agreed to provide 500mn Cubic Feet per Day (MMCFD) LNG to Pakistan, but has shown its inability to construct LNG terminal in Karachi
  • Urea prices on the world market are gradually declining and so far witnessed a steep fall of some USD100/ton during the last few months mainly due to oversupply. Market declining trend in the urea prices would be benefit for Pakistan as it is going to finalize urea deal for the import of 0.3mn tons 
  • Import of 0.3mon tons of urea recently approved by the ECC of Cabinet has reportedly turned out to be a mega scandal as two ministries are challenging each other's definition of "emergency"
  • PM Sharif inaugurated the 84MW Laraib New Bong Hydropower project
  • This week foreign portfolio investment remained at $4.64 million only
  • Good results of independent power producers (IPPs), oil & gas and fertiliser sectors are expected, which will have a positive impact on the market
  • There were talks that the discount rate will be increased that would improve profits of the banking sector. Such talks invited more attraction in the banking stocks
  • Engro Corporation, which closed at the upper lock in some sessions because of the announcement of more gas availability to its fertiliser plant, witnessed lower locks when it was witnessed that the gas supply will be delayed. However, later in the week, Engro again gathered strength on the assurance of gas supply on time
  • Cement sector also remained active amid hope for better June earnings due to decline in the international coal prices and better margins

Top ten gainers of last week were: Faysal Bank, B.O.Punjab, Habib Bank, Fauji Fert Bin, Abbot Laboatories, National Bank Of Pakistan, Nishat Chunian, Pakistan Cables, National Foods and Adamjee Insurance.

Top ten losers of last week were: Ghani Glass, International Industries, Lucky Cement, Bata (Pak) Ltd., NIB Bank, Fatima Fert.Co., K.E.S.C., Colgate Palmolive, JS Bank and Mari Petroleum.

Top ten volume leaders were: BOP, NBP, PTC, FABL, FCCL, JSCL, ENGRO, FFBL, DGKC and BAFL.

Thank you very much for reading this article.

NOTE: The information posted in this blog (forum) is based on current affairs & investors point of view. There may be discrepancy in the ground realities.

Written by: Rana Khurram

No comments:

Post a Comment