Karachi Stock Exchange Weekly Analysis 21 June, 2015

The Karachi Stock Exchange (KSE) market remained flat to end the week at 34,526pts, shedding 0.36% amid slight profit taking before the start of Ramadan. KSE-100 index closed on 3 4,527 by losing -124 points or -0.36% while KSE-30 index closed on 21,658 by losing 95 points or -1.01%.

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

  • A slew of political developments in the outgoing week; spearheaded by controversial remarks from an ex‐president failed to stir the KSE‐100 benchmark
  • The inauguration of country's largest oil refinery complex with a crude oil refining capacity of 120,000 barrels/day, fulfilling around 39% of country's energy needs and cutting down reliance on imports. The refinery built by the Byco Group has attracted in an investment of USD 750mn and produce about 1.6mn tons of Fuel oil, 2.4mn tons of diesel, 1.1mn tons of LPG annually. He also appreciated the Abraaj Group for their investment in refinery
  • CAD deficit for May’15 recorded at US$521mn vs. a surplus of US$223mn in Apr’15 (11MFY15 CAD at US$1.98bn vs. US$3.02bn in 11MFY14)
  • Acceptance of budget proposals including a PkR20bn subsidy on phosphoric fertilizer and extension of income tax exemption on Halal meat units to Jun’17
  • Proposal of PkR5bn subsidy allocation to farmers for purchase of 25,000 tractors in the Punjab budget FY16
  • Increase in RD on the import of sugar from 20% to 40%
  • The banking sector was the star performer of the week after Moody’s upgraded the ratings of 5 major commercial banks from Caa1 to B3 with a stable outlook. The market responded positively to the news and the sector contributed a gain of 50 points to the KSE-100 index
  • Credit ratings upgrade by Moody’s of local‐currency deposits from Caa1 to B3 for five banks (UBL, HBL, MCB, ABL and NBP) as well as the base‐line credit assessments (BCA) for all banks except NBP, again from Caa1 to B3
  • Proposal to exempt tax on capital gains on disposal of securities held for four years or more for Tax year 2015‐16
  • Foreigners remained net sellers of PkR5.65mn vs. net buyers of PkR13.84mn in the previous week
  • The World Bank agreeing to loan $500 million to the country which will help shore up the foreign exchange reserves
  • The automobile and cement sectors also put in a decent performance as provincial budgets revealed extensive spending on tractors for farmers and road construction schemes. Heavy activity was witnessed in specific stocks in both sectors and contributed positively to the index
  • Dewan Cement Limited (DCL) has decided to convert its outstanding loan of Rs500mn into 50mn ordinary shares of Rs10 each
  • The headline of the week was a conspicuous rally in KEL that was catapulted into greener meadows, thanks to foreign interest augmented by handsome support from HNWI’s. The stock achieved a landmark turnover of 217mn shares in a single trading day, shattering all previous records
Top gainers of last week were: Rafhan Maize Prod., Sui North Gas Pipe., Bata (Pak) Ltd., Hum Network Ltd, Nishat Power Ltd, Jubilee Gen Ins, Dawood Hercules Chem, Sui South Gas, Searle Pak and K‐Electric.
Top losers of last week were: Fauji Fert Bin, Muree Brewery Co Ltd, Honda Atlas Cars, Nishat Chunian, Gul Ahmed, Mari Petroleum, National Bank of Pakistan, EFU Life Assur Ltd., Allied Rental Mod and Shell Pakistan.

Top ten volume leaders: KEL, JSCL, FFBL, TRG, PAEL, PIBTL, PTC, HUMNL, BOP, FCCL, and SCBPL.

Following are few BUY recommendations:

Pak Suzuki Motors (PSMC) – BUY
Current Price: PKR 447.5
Target Price: PKR 552.00

Engro Fertilizers Limited (EFERT) – BUY
Current Price: PKR 89.5
Target Price: PKR 103.2

Fauji Fert. Bin Qasim Ltd. (FFBL) – BUY
Current Price: PKR 55.9
Target Price: PKR 62.4

Fatima Fertilizer (FATIMA) – BUY
Current Price: PKR 39.2
Target Price: PKR 50.7

Oil & Gas Development Co. (OGDC) – BUY
Current Price: PKR 193.8
Target Price: PKR 238.2 

Pak Oilfields (POL) – BUY
Current Price: PKR 407.3 
Target Price: PKR 442.00

Pakistan Petroleum (PPL) – BUY
Current Price: PKR 170.53
Target Price: PKR 221.00

K-Electric Co. (KEL) – BUY 
Current Price: PKR 8.7
Target Price: PKR 13.3

Nishat Mills (NML) – BUY
Current Price: PKR 116.1
Target Price: PKR 168.5 

Nishat Chunian Ltd. (NCL) – BUY 
Current Price: PKR 33.6
Target Price: PKR 45.7

Allied Bank Limited (ABL) – BUY
Current Price: PKR 100.9
Target Price: PKR 140.0 

Habib Bank Limited (HBL) – BUY
Current Price: PKR 205.1
Target Price: PKR 270

MCB Bank Ltd (MCB) – BUY
Current Price: PKR 239.8
Target Price: PKR 320

National Bank (NBP) – BUY
Current Price: PKR 51.2
Target Price: PKR 69.0

United Bank Ltd (UBL) – BUY
Current Price: PKR 167.1
Target Price: PKR 194.00

Bank Al-Falah (BAFL) – BUY
Current Price: PKR 24.96
Target Price: PKR 34

Bank Al-Habib (BAHL) – BUY
Current Price: PKR 41.30
Target Price: PKR 68

Lucky Cement (LUCK) – BUY
Current Price: PKR 500
Target Price: PKR 552.00

DG Khan Cement (DGKC) – BUY
Current Price: PKR 143
Target Price: PKR 162

Engro Foods Limited (EFOODS) – BUY
Current Price: PKR 152
Target Price: PKR 177.8

Following are few SELL recommendations:

Hub Power Co (HUBCO) – SELL
Current Price: PKR 95.58
Target Price: PKR 71.00

Nishat Power Ltd (NPL) – SELL
Current Price: PKR 60.00   
Target Price: PKR 38.00

Nishat Chun Power (NCPL) – SELL
Current Price: PKR 59.47
Target Price: PKR 43 

Pakgen Power Ltd (PKGP) – SELL
Current Price: PKR 30.30
Target Price: PKR 24

Maple Leaf Cement (MLC) – SELL
Current Price: PKR 77.32
Target Price: PKR 65

Indus Motor (INDU) – SELL
Current Price: PKR 1294.70
Target Price: PKR 1023.00

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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