Pakistan Stock Exchange (PSX) Weekly Analysis 25 Sep, 2016

BUY recommendations are ABL, DGKC, EFERT, EFOODS, ENGRO, FATIMA, FCCL, FFBL, HBL, KEL, KOHC, LUCK, MCB, MLCF, OGDC, PAEL, PIOC, PPL, PSMC, PSO, PTC, TGL and UBL.

Top gainers of last week were: Associated Services Limited, Honda Atlas Cars, Millat Tractors, International Steels Ltd, Orix Leasing, Pak Tobacco Co, Lucky Cement, Jubilee Life Ins, Colgate Palmolive and The Searle Pak.

Top losers of last week were: Hum Network Ltd, TRG Pakistan Ltd, Muree Brewery Co Ltd, Ghani Glass Ltd, Jah.Sidd. Co., Ferozsons (Lab), B.O.Punjab, Dawood Hercules Chem, Engro Corp and Fauji Fertilizer Co.

Top Volume Leaders of last week: BOP, TRG, KEL, JSCL, SSGC, PIBTL, PTC, SNGP, NBP, NCL, and NUMNL.

The Pakistan Stock Exchange (PSX) market index witnessed volatility on concerns regarding domestic politics and jitters from global monetary policies with profit taking deflating the benchmark index by 1.44%WoW to 39,782pts. KSE-100 index has reached on 39,782 by decreasing -582 points or - 1.44 %.While KSE-30 index has reached on 22,108 by decreasing -446 points or -1.98 %.

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

• SBP have announced its MPS over the weekend; and keeps the discount rate unchanged
• The market was under dark clouds in the outgoing week as the wider investor community was spooked amid a heated exchange of statements between Indian and Pakistani leadership
• Foreign selling continued with outflows for the week at US$16.04mn vs. US$4.49mn in the previous five sessions
• PIB auction yields remained largely stable with GoP raising PkR219bn
• WB approved US$390mn loan for Tarbela fifth extension project
• Current account deficit for 2MFY17 clocked in at US$1.3bn, expanding 92%YoY
• Mergers and acquisition stories remained the key play in most of the low cap names and even some big ticket items like PTC where rumors were rife regarding Etisalat approaching Zong for sale of its equity stake in the company. Shanghai Electric emerged as the key contender for a controlling stake in KEL while MCB’s planned acquisition of NIB also seems to be heading into a conclusive channel
• Ministry of Industries and Production decided to seek approval of the ECC for further reduction in urea prices in order to offload 1.5mn tons of stock
• Political risks remain in place with PTI’s protest set for next week likely keeping investors cautious
• PKR 1mn penalty imposed on Takaful firm: Protection of interest of policyholders obligatory
• Fertiliser importers are all set to increase the price of di‐ammonium phosphate (DAP) by Rs300 per 50kg bag as the government has not been able to establish a subsidy mechanism and transfer funds to the importers for three months 
• More than half a million jobs have been lost in the country in two years due to factory closures, a global news agency reported
• Mari Petroleum Company Limited (MPCL) has borrowed Rs9 billion from Habib Bank Limited in a bid to accelerate the search for untapped oil and gas deposits in the country, particularly in Sindh and Balochistan 
• FFC, ENGRO and DAWH cumulatively contributed 216pts to index decline as overall fertilizer sector came under pressure, posting 4% negative return, mainly owing to renewed concerns on urea pricing and inventory levels
• Pharma exports: Drug regulations to be brought at par with world

Following are few BUY recommendations:

Allied Bank Limited (ABL) – BUY 
Current Price: PKR 97.3
Target Price: PKR 120

DG Khan Cement (DGKC) – BUY 
Current Price: PKR 187
Target Price: PKR 230

ENGRO Fertilizer Limited (EFERT) – BUY 
Current Price: PKR 62.3
Target Price: PKR 95

ENGRO Foods (EFOODS) – BUY 
Current Price: PKR 138.1
Target Price: PKR 163

Engro Corporation (ENGRO) – BUY
Current Price: PKR 286.7
Target Price: PKR 361

Fatima Fertilizer (FATIMA) – BUY 
Current Price: PKR 33.04
Target Price: PKR 48.68

Fauji Cement Company Limited (FCCL) – BUY 
Current Price: PKR 35.6
Target Price: PKR 47

Fauji Fert Bin Qasim (FFBL) – BUY 
Current Price: PKR 52.00
Target Price: PKR 60.48

Habib Bank Limited (HBL) – BUY 
Current Price: PKR 218.4
Target Price: PKR 255

K-Electric (KEL) – BUY
Current Price: PKR 9
Target Price: PKR 13

Kohat Cement (KOHC) – BUY
Current Price: PKR 254.5
Target Price: PKR 353

Lucky Cement (LUCK) – BUY
Current Price: PKR 681.3
Target Price: PKR 755

MCB Bank Limited (MCB) – BUY 
Current Price: PKR 210.2
Target Price: PKR 240

Maple Leaf Cement Factory (MLCF) – BUY 
Current Price: PKR 96.6
Target Price: PKR 123

Oil & Gas Development Co. (OGDC) – BUY 
Current Price: PKR 139.4
Target Price: PKR 164

Pak Electron (PAEL) – BUY 
Current Price: PKR 70
Target Price: PKR 83

Pioneer Cement Limited (PIOC) – BUY 
Current Price: PKR 105.1
Target Price: PKR 136

Pakistan Petroleum Limited (PPL) – BUY 
Current Price: PKR 159
Target Price: PKR 193.8

Pak Suzuki Motors (PSMC) – BUY 
Current Price: PKR 514.6
Target Price: PKR 661

Pakistan State Oil (PSO) – BUY 
Current Price: PKR 408.5
Target Price: PKR 456

Pakistan Telecommunications (PTC) – BUY 
Current Price: PKR 18.1
Target Price: PKR 21.9

Tariq Glass (TGL) – BUY 
Current Price: PKR 100.8
Target Price: PKR 136

United Bank Limited (UBL) – BUY 
Current Price: PKR 195.7
Target Price: PKR 235

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