Karachi Stock Exchange Weekly Analysis 15 March, 2015

The Karachi Stock Exchange (KSE) market continued its losing streak, falling by 1.01%WoW to 32,929 points in the week under review.  KSE-100 index closed on 32,929 by losing 335 points or -1.01%  while KSE-30 index closed on 21,200 by losing 495 points or -2.28%.
ADTO remained largely flat, down 18% WoW to 142mn shares, while ADV was down by 22% to US$80mn. FIPI registered yet another net outflow of US$28.4mn, much higher than last week’s outflow of about US$4.4mn.

According to experts of http://www.karachistockexchange.org, following news have played vital role in Karachi Stock Market index movement:

  • The news of gas price increase, which came in limelight at the start of the week; dragged the market
  • Concerns regarding deteriorating law & order in Karachi further pilled pressure
  • On the positive side remittances continued to depict strong growth, up 15.1%YoY in Feb’15 to reach US$11.7bn for 8MFY15, the country’s Fx reserves increased by 1.2%WoW and are now at US$16bn level (import cover at 4.8m) with another US$500+mn tranche due from IMF this month
  • Cement sales for 8MFY15 clocking in at 22.8mt, rising 5.5%YoY
  • SBP figures revealing that the GoP borrowing for additional budgetary support reached PkR1.03trn from schedules banks during 8MFY15, 2.23x higher than the PkR318.42bn borrowed in the same period last year
  • NEPRA approving proceeding to finalize the import of 1000MW of electricity from Iran, with a tariff adjusted between US$65-US$110/bbl translating into PkR8-11/KwH similar to the prevailing arrangement importing 74MW from Iran since 2007
  • The entire fertilizer sector took prominence as an expected increase in both feed and fuel gas prices triggered a wave of selling in the respective stocks
  • Big tickets were seen under pressure on account of foreign selling, with banks and some leading names in the cement sector feeling the pinch
  • GoP’s announcement of putting up HBL’s 41.54% shares for sale to the general public in a secondary offering dragged its price in the earlier half of the week, only to recover upon late buying albeit thin volumes
  • HBL acquiring Pakistan business of Barclays Bank
  • DLL is going to invest USD30mn in the equity of TGL through the issue of right shares. The power generation facility is being constructed at a cost of USD89mn. The project is envisaged to be financed through a mix of 25% equity and 75% debt
  • The Board of Directors of Dawood Hercules Limited (DAWH) has approved to enter into a Share Purchase Agreement with Pakarab Fertilizers Limited (PFL) for the entire shareholding of the Company in DH Fertilizers Limited (subject to negotiated and finalizing SPA and procuring corporate approvals and regulatory consents)

Top gainers of last week were: Pak Services, Shezan International Ltd., Fatima Fert.Co., Arif Habib Corp, EFU Life Assur Ltd., TRG Pakistan Ltd, Attock Petroleum, Pak Suzuki Motor, EFU General Ins and Jubilee Life Ins.

Top losers of last week were: Pak Tobacco Co, Fauji Fert Bin, Fauji Fertilizer Co., Engro Fertilizer, Soneri Bank, Shell Pakistan, Atlas Honda Limited, Abbott Lab, Nishat Power Ltd and Gul Ahmed.

Top ten volume leaders: JSCL, FFBL, MLCF, TRG, BOP, KEL, EFERT, PTC, ENGRO, FABL, and FCCL.

Following are few BUY recommendations:

Maple Leaf Cement Factory (MLCF) – BUY
Current Price: PKR 53.2
Target Price: PKR 61.0 

Cherat Cement (CHCC) - BUY
Current Price: PKR 81.25
Target Price: PKR 95.00 

Fatima Fertilizer (FATIMA) - BUY
Current Price: PKR 41.3
Target Price: PKR 51.7

Oil & Gas Development Co. (OGDC) – BUY
Current Price: PKR 205.0
Target Price: PKR 256.5 

Pak Oilfields (POL) – BUY
Current Price: PKR 367.5
Target Price: PKR 442.00

Pakistan Petroleum (PPL) – BUY
Current Price: PKR 166.56
Target Price: PKR 221.00

Nishat Mills (NML) - BUY
Current Price: PKR 118.8
Target Price: PKR 163.5

Allied Bank Limited (ABL) – BUY
Current Price: PKR 103.0
Target Price: PKR 140.0 

Bank Al-Falah (BAFL) – BUY
Current Price: PKR 30.1
Target Price: PKR 38.0

Habib Bank Limited (HBL) – BUY
Current Price: PKR 200.0
Target Price: PKR 255.0

United Bank Ltd (UBL) – BUY
Current Price: PKR 165.9
Target Price: PKR 210.0

Bank Al-Habib (BAHL) – BUY
Current Price: PKR 46.25
Target Price: PKR 68.00 

Kot Addu Power Co (KAPCO) – BUY
Current Price: PKR 81.29
Target Price: PKR 97.0 

Following are few SELL recommendations:

Hub Power Co (HUBCO) – SELL
Current Price: PKR 87.73
Target Price: PKR 71.00

Nishat Power Ltd (NPL) – SELL
Current Price: PKR 50.25
Target Price: PKR 38.00

Nishat Chun Power (NCPL) – SELL
Current Price: PKR 51.88
Target Price: PKR 43 

Pakgen Power Ltd. (PKGP) – SELL
Current hn6Price: PKR 30.46
Target Price: PKR 24.00

Thank you very much for reading this article.

NOTE: The information posted in this blog /forum (http://www.karachistockexchange.org/) 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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