MUGHAL & ASTL_Projections incorporating macro-developments, (AKD Daily, Jun 07, 2022)
AKD Daily MUGHAL & ASTL: Projections incorporating macro-developments · We revisit our investment case for MUGHAL and ASTL where we revised our target prices to PkR94/sh and PkR35/sh from PKR140/sh and PkR57/sh for MUGHAL and ASTL, respectively. Incorporating RF of 15.5% and PkR/US$ of 198/210 in FY23/24F. · We expect the earnings outlook for MUGHAL and ASTL to remain dreary in FY23 with the companies expected to see a volumetric decline of 10-12%YoY to 280-340K tons in rebar/girder dispatches for FY23. Likewise, we foresee a decline in EPS to PkR13.12/sh and PkR4.29/sh in FY23 from PkR16.2/sh and PkR7.61/sh in FY22F for MUGHAL and ASTL, respectively. · However, post FY23, we believe industry rebar volumes to register a 3y CAGR of 6% between FY23-26F. Moreover, we have also assumed MUGHAL and ASTL rebar volumes to register a 3yr CAGR of 13.7% and 8.4% between FY23-26F, respectively. We also expect a 3-yr earnings CAGR of 19.9% and 24.3% for MUGHAL and ASTL between FY23-26F, respectively. · Apart from ferrous segment, we expect MUGHAL’s non-ferrous segment to register a 4yr earning/sales CAGR of 8.9/10.7% with an earnings contribution of 57% and avg. GMs of 20.3% between FY22-26F. AKD Research
Amreli Steels Limited is a Pakistan-based steel manufacturing company. The Company is engaged in the manufacture and sale of steel bars and billets. The Company offers a range of steel bars for all construction needs.
AKD Securities Ltd. is one of the leading securities firm in Pakistan, providing a comprehensive range of investor focused services, including equity brokerage, economic and securities research, investment banking and financial advisory services. AKD Securities accounts for more than 6% of the average daily value of the Karachi Stock Exchange. AKD Securities was the first brokerage house to launch an online trading platform in Pakistan in November 2002 and now has the largest market share with over 6000 customers. This has helped diversify and expand the retail investor base in the country and ushered in a whole new universe of investors to the stock market.
AKD Securities Ltd. caters to a diversified group of domestic and international institutional investors, high net worth individuals and upscale retail clients, including expatriate Pakistanis. With high quality research, unparalleled execution and distribution capability for both regular and large block trades, AKD Securities Ltd. has earned an outstanding reputation in the Pakistani securities industry.Outside of commercial banks, AKD Securities Ltd. is one of the biggest capital market firms in the country. AKD Securities is the leader in raising and providing risk capital in underwriting, market making and mergers and acquisitions in Pakistan. Good corporate governance and professionalism are emphasized throughout the firm and AKD Securities Ltd. is amongst the very few companies to have introduced a firm-wide comprehensive CODE of ETHICS, overseen by an independent compliance manager.Ultimately, our success is based on the quality of service we provide to our customers and the trust and confidence reposed in us by them. Our focus, therefore, remains on customer satisfaction at all levels in the company.
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