Karachi Stock Exchange Weekly Analysis 13 July, 2015

The Karachi Stock Exchange (KSE) market registered a much awaited correction during the week. KSE-100 index closed on 3 5,112 by losing -344 points or -0.97% while KSE-30 index closed on 21,959 by losing -354 points or -1.59%.

Over the week, the average trading volumes improved by 6% week-on-week to 378 million shares per day, while average daily trading value rose 23% to $160 million.

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

  • Political uncertainty and selling in oil stocks amid falling international crude prices, which hit a three-month low, wiped off the early gains
  • Oil prices fell during the week by about 2%, reeling from the effect of Greece’s financial crisis and China’s stock market woes, leading to a considerable battering of the exploration and production (E&P) sector (down an average 5.5% WoW)
  • Hascol hit its upper circuit within the first hour of trading, similarly Pakistan State Oil, Pakistan Oilfields Limited and Pakistan Petroleum Limited ended 0.7%, 0.6% and 0.3% higher, respectively
  • The cement sector continued to outperform others on strong June 2015 sales, while insurance stocks (+4% WoW) also attracted investor interest
  • The banking sector remained impressive on rising deposit growth and increasing yields of treasury bills
  • Among market-moving news, the debate over the controversial banking transaction tax heated up until the government and traders reached an agreement on Thursday to bring down the 0.6% withholding tax to 0.3% for the non-filers of tax returns till September 2015
  • Foreign funds flew out of the market, with foreigners selling $23 million worth of holdings compared to $1.6 million last week
  • NEPRA has made electricity costlier by 20 to 80% for domestic consumers of K‐Electric by slashing the amount of subsidy as per agreement with the IMF. The impact of reduction in subsidy for domestic consumers will be between PKR2 to PKR4.28/unit \
  • The government plans to borrow PKR1.35tn through the banking system in the 1QFY16. The government has slashed the selling of PIBs by limiting them to PKR200bn during the quarter
  • The NBP in collaboration with HBL is planning to invest PKR80bn in a 1,200MW power generation project
  • 150MW solar power plants: Pakistan, Norway companies sign MoU
  • Mughal Group of Industries has planned a 55MW coal‐fired power plant to be setup in Sheikhupura with an estimated cost of USD141.701mn
  • SSC on Water and Power headed by Senator decided to conduct a performance audit of KElectric through Auditor General of Pakistan aimed at judging the performance of the power utility
  • Major gain was seen in Life Insurance (5.0%), Non Life Insurance (4.3%) and Cement (3.5%), while major decline was witnessed in Oil & Gas (3.9%) and Telecom (3.2%), during the outgoing week
  • Pakistan’s fx reserves rising to highest ever levels of US$18.7bn as of last week, following inflows from the IMF, where the SBP’s reserves now stand at US$13.5bn

Top gainers of last week were: Punjab Oil, TRG Pakistan Ltd, Jubilee Gen Ins, Kohat Cement, Adamjee Ins, Jubilee Life Ins, Kohinoor Textile, Bannu Woollen, J.D.W.Sugar and Colgate Palmolive.
   
Top losers of last week were: Arif Habib Corp, Pak Oilfields, Service Indus, Pak Petroleum, National Refinery, Sui South Gas, P.S.O., Shifa International Hospitals, Dawood Hercules Chem and K‐Electric.

Top ten volume leaders: KEL, JSCL, PIBTL, TRG, FCCL, PAEL, LPCL, MLCF, PTC, DGKC, and BOP.

Following are few BUY recommendations:

Pak Suzuki Motors (PSMC) – BUY
Current Price: PKR 436.9
Target Price: PKR 552.00

Fatima Fertilizer (FATIMA) – BUY
Current Price: PKR 40.6
Target Price: PKR 50.7

Engro Fertilizers Limited (EFERT) – BUY
Current Price: PKR 91.75
Target Price: PKR 103.2

Engro Corporation (ENGRO) – BUY
Current Price: PKR 308
Target Price: PKR 338

Engro Foords (EFOODS) – BUY
Current Price: PKR 156
Target Price: PKR 177.8

Oil & Gas Development Co. (OGDC) – BUY
Current Price: PKR 176.7
Target Price: PKR 238.2

Pak Oilfields (POL) – BUY
Current Price: PKR 372.3
Target Price: PKR 442.00

Pakistan Petroleum (PPL) – BUY
Current Price: PKR 159.58
Target Price: PKR 221.00

Pakistan State Oil (PSO) – BUY
Current Price: PKR 383
Target Price: PKR 493

K-Electric Co. (KEL) – BUY  
Current Price: PKR 8.0
Target Price: PKR 13.3

Pakistan Telecommunication (PTC) – BUY  
Current Price: PKR 20.5
Target Price: PKR 25.1

Nishat Mills (NML) – BUY
Current Price: PKR 115.5
Target Price: PKR 168.5

Nishat Chunian Ltd. (NCL) – BUY
Current Price: PKR 37.6
Target Price: PKR 45.7

Allied Bank Limited (ABL) – BUY
Current Price: PKR 99.1
Target Price: PKR 140.0

Habib Bank Limited (HBL) – BUY
Current Price: PKR 214.06
Target Price: PKR 270

National Bank (NBP) – BUY
Current Price: PKR 53.8
Target Price: PKR 69.0

United Bank Ltd (UBL) – BUY
Current Price: PKR 171.08
Target Price: PKR 194.00

Bank Al-Falah (BAFL) – BUY
Current Price: PKR 27.16
Target Price: PKR 34

Bank Al-Habib (BAHL) – BUY
Current Price: PKR 44.40
Target Price: PKR 68

MCB Bank Ltd (MCB) – BUY
Current Price: PKR 264
Target Price: PKR 320

Lucky Cement (LUCK) – BUY
Current Price: PKR 564.24
Target Price: PKR 652.00

Following are few SELL recommendations:

Fauji Fert. Bin Qasim Ltd. (FFBL) – SELL
Current Price: PKR 58.34
Target Price: PKR 49.00

Hub Power Co (HUBCO) – SELL
Current Price: PKR 97.45
Target Price: PKR 71.00

Nishat Power Ltd (NPL) – SELL
Current Price: PKR 59.21
Target Price: PKR 38.00

Nishat Chun Power (NCPL) – SELL
Current Price: PKR 59.70
Target Price: PKR 43

Pakgen Power Ltd (PKGP) – SELL
Current Price: PKR 29.50
Target Price: PKR 24

Indus Motor (INDU) – SELL
Current Price: PKR 1242.00
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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