Karachi Stock Exchange Weekly Analysis 11 Jan, 2014

The Karachi Stock Exchange (KSE) market was bullish and Bullish momentum lifts index to all time high. KSE - 100 index closed at 26,488.32 points by gaining +441.61 points or +1.70 percent, while KSE - 30 index closed at 19,498.24 points by gaining +142.84 or +0.74 percent.

Activity also improved with KSE-100 trading an average of 183 million shares, +8% from the previous week, while USD value traded jumped 16%. Next week’s trial of Former President Musharraf would likely be in limelight and any political noise may alter sentiment. According to analysts, the market is likely to witness mixed trend next week due to expected correction.

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

  • Privatization board approved divestment of GoP's shares in PIA, OGDC, PPL, HBL, UBL, ABL, Heavy Electrical Complex and National Power Construction Company
  • Major stocks like OGDC +1.1%, HBL +10.9% and UBL +3.7% that were approved by privatization commission for divestment led the index rally while Consumers names (NATF +27%, NESTLE +9.5% and PAKT +22%) also contributed to index performance during the week
  • Overall optimism continued during the week on expectations of inflows after IMF’s report suggested satisfaction on implementation of reforms and expectations of no change in DR in the upcoming monetary policy
  • ECC raised concerns over recent urea price hike and concessionary gas to Engro fertilizers
  • ECC also approved Lucky Cement’s investment of USD40mn in Congo
  • Government of Pakistan has appointed new BoI chief
  • Local cement sales for Dec-13 grew by 3.8% YoY 
  • PKGP/LPL and HUBC would likely be the key beneficiaries of coal conversion
  • Lack of financial inflows push SBP reserves down
  • Tractor sales hit by hike in GST
  • Drug prices pushed up by 20 to 80pc despite govt orders
  • Dollar at Rs 106 on open market
  • POL sales increase by 11% in first half of FY14
  • LNG import deal with Yemen likely this month
  • Exporters perturbed at government's inaction to capitalize on GSP plus status
  • Bank deposits rise to Rs 7.5 trillion on MDR
  • Pakistan is yet to receive USD798mn under CSF from the United States for the period from October 2012 to March 2013
  • Following in Engro’s footsteps, FFC raised the price of a 20kg bag of urea to PKR 1,875
  • PTA is granting three months free trial of the next generation technology services to major mobile companies in Pakistan to enable them to improve their preparedness before its complete 
  • SNGPL is seeking a massive PKR69/MMBTU raise in gas tariff, arguing it would be left with no option but to brave losses worth PKR6bn/annum if the requested hike is not put in to place
  • Pakistan is all set to increase its textile exports by 3bn dollars this year since textile sector has improved its production capacities over the last few years, chairman of APTMA, Punjab. APTMA had done its homework before committing to the government to raise the textile exports, which suffered in the past because of various reasons, including power shortage, high markup and limited market access 
  • IMF lifting its FY14E GDP growth outlook for Pakistan to 2.8% (up 0.3% from initial outlook)
  • There are expectations of good dividends from Fauji Group companies such as FFC, FFBL and FCCL kept high interest in these scrips
  • Strong December quarterly results expected from Engro Fertilizer, Pakistan State Oil, Fauji Fertilizer Bin Qasim Limited and banks could garner stock-specific interest

Top ten gainers of last week were: Lafarge Pakistan, Muree Brewery Co Ltd, National Foods, Pak Tobacco Co.XD, Feroz 1888 Mills Ltd, Ghani Glass, Soneri Bank, Tri‐Pack Films Limited, Shell Pakistan and Shifa International Hospitals.

Top ten losers of last week were: J.D.W.Sugar, Bata (Pak) Ltd., Kohinoor Textile, NIB Bank, Rafhan Maize Prod., Javedan Corporation, P.T.C.L.A, Netsol Technologie, Abbott Lab and Century Paper.

Top ten volume leaders were: LPCL, KESC, ANL, BOP, FCCL, JSCL, MLCF, FABL, DGKC, and NCPL.

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

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