Karachi Stock Exchange Weekly Analysis 10 Aug, 2015


SELL recommendations are FFBL, HUBCO, NPL, NCPL, PKGP, INDU and HCAR

Top gainers of last week were: Punjab Oil, National Refinery, Ghani Glass Ltd, Pak Suzuki Motor, Searle Pak, Dawood Hercules Chem, Fauji Fert Bin, Kohat Cement, EFU Life Assur Ltd. and Pak Elektron.
Top losers of last week were: Jubilee Gen Ins, TRG Pakistan Ltd, Service Indus, Sui South Gas, Archroma Pakistan, Sui North Gas Pipe., Colgate Palmolive, Bannu Woollen, Packages Limited and Stand.Chart.Bank.

Top ten volume leaders: SHFA, PAEL, KAPCO, PKGS, RMPL, MCB, LPCL, FML, EFERT, EFOODS and MLCF.

The Karachi Stock Exchange (KSE) market continued its bullish momentum gaining 481 points (1.3%) during the week. Market crossed the psychological barrier of 36k points to close the week at 36,222pts (+481 points). KSE-100 index closed on 3 6,223 by gaining 481 points or 1.35%, while KSE-30 index closed on 22,432 by gaining 193 points or 0.87%.

Trading activities were largely supported by blue chips where average traded value increased by 5% to US$133mn. However, average volume went down to 295mn shares per day amid low interest in 2nd or 3rd tier stocks.

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

  • Corporate earnings took a front seat during the week, where ABL and UBL posted healthy results while key fertilizer stocks (FFC, FFBL) appeared as nets loser with below par results
  • The auto sector posted enormous results (HCAR and PSMC) for the period ending June
  • Announcement of corporate results (EFERT, POL, MCB, APL) are likely to be the sentiment movers in the upcoming week
  • Inflation determined at 1.8% and below market consensus also shifted investors’ focus towards cement and other leverage sector despite lower dispatches for the period
  • Pakistan and IMF official are meeting on a quarterly review of economic performance, Pakistani authorities have reportedly informed the IMF of the possibility of not implementing the 0.6% withholding tax on all bank transactions
  • World Bank’s assistance offer worth US$2bn
  • Soft inflation numbers for July 2015. Lower than expected CPI once again built expectations of another cut in the Policy Rate, improving the prospects for leveraged companies as MLCF and PAEL gained 7.3% and 8.6% respectively during the week
  • Foreigners remained net buyers worth US$4.8mn this week
  • SBP cut refinancing rates by 150bps
  • Forex reserves hit all-time high of US$18.82bn
  • FBR will charge enhanced rate of 36.5% sales tax on the supply of electricity generated exclusively through high speed diesel by the IPPs
  • The OGRA has imposed a fine of PKR10.7mn on 12 OOMCs for overcharging the consumers during petrol crisis of January 2015. Twelve companies were found involved in overcharging including PSO, Total Parco and APL, HASCOL, SHELL, Baiko, Bakri and others
  • MoW&P and K‐Electric will hold the second round of talks on August 12, 2015 and agree on a new set of conditions for the continuation of supply of 650MW from the national grid, well informed
  • The general public portion for the IPO of Al Shaheer Corporation has been subscribed 1.15 times
  • Expectations of elevated Iranian oil output by 500k bpd upon lifting of sanctions to pose downside risk to oil prices
  • Cement and Chemical sectors staged comeback, cumulatively adding 316 points to the index during the week. DAWH and Engro contributed 76 and 51 points, respectively in the index
  • Interestingly, Pharma sector also increased by 52 points during the week as market speculated on price increase by drug regulatory authority
  • SECP cuts mutual fund unit charges to 3%
  • Inflation eases to 1.8% in July
  • SECP plans capital market hub in Abbottabad
  • PIA’s privatisation: Government gives fresh commitment to IMF
Following are few BUY recommendations:

Oil & Gas Development Co. (OGDC) – BUY
Current Price: PKR 162.04
Target Price: PKR 238.2 

Pak Oilfields (POL) – BUY
Current Price: PKR 364.09
Target Price: PKR 442.00

Pakistan Petroleum (PPL) – BUY
Current Price: PKR 153.49
Target Price: PKR 221.00

Pakistan State Oil (PSO) – BUY
Current Price: PKR 382.25
Target Price: PKR 493

MARI Petroleum (MARI) – BUY
Current Price: PKR 447
Target Price: PKR 625

K-Electric Co. (KEL) – BUY 
Current Price: PKR 8.21
Target Price: PKR 13.3

United Bank Ltd (UBL) – BUY
Current Price: PKR 183.57
Target Price: PKR 194.00

Allied Bank Limited (ABL) – BUY
Current Price: PKR 106.01
Target Price: PKR 140.0 

National Bank (NBP) – BUY
Current Price: PKR 57.98
Target Price: PKR 69.0

Habib Bank Limited (HBL) – BUY
Current Price: PKR 228.55
Target Price: PKR 270

Bank Al-Falah (BAFL) – BUY
Current Price: PKR 28.52
Target Price: PKR 34

Bank Al-Habib (BAHL) – BUY
Current Price: PKR 44.46
Target Price: PKR 68

Nishat Mills (NML) – BUY
Current Price: PKR 121.5
Target Price: PKR 168.5 

Nishat Chunian Ltd. (NCL) – BUY
Current Price: PKR 40.5
Target Price: PKR 45.7 

Engro Corporation (ENGRO) – BUY
Current Price: PKR 334.4
Target Price: PKR 403

Following are few SELL recommendations:

Fauji Fert. Bin Qasim Ltd. (FFBL) – SELL
Current Price: PKR 63.98
Target Price: PKR 49.00

Hub Power Co (HUBCO) – SELL
Current Price: PKR 99.02
Target Price: PKR 71.00

Nishat Power Ltd (NPL) – SELL
Current Price: PKR 59.90
Target Price: PKR 38.00

Nishat Chun Power (NCPL) – SELL
Current Price: PKR 59.99
Target Price: PKR 43 

Pakgen Power Ltd (PKGP) – SELL
Current Price: PKR 32.50
Target Price: PKR 24

Indus Motor (INDU) – SELL
Current Price: PKR 1297.74
Target Price: PKR 1023.00

Honda Atlas Cars (HCAR) – SELL
Current Price: PKR 272.71
Target Price: PKR 204.00

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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