Pakistan Steel_RD reduction is more bark than bite
In a recent and what appears to be a populistic move, MoC has reportedly recommended withdrawal of regulatory duty on 57 tariff lines including 47 steel products in the upcoming budget. While the said recommendations hold limited chance to get through considering narrow fiscal space, approval of the same can have wide-ranging implications for the steel sector. For long steel players (ASTL, MUGHAL and ITTEFAQ), elimination of 30% RD on re-bars would significantly hurt the pricing power of domestic manufacturers, as the price differential between imported and local re-bars would shrink to ~PkR13k per ton (which currently stands at ~PkR39k per ton). For flat steel (manufactured by ASL & ISL), the said proposal carries marginally negative implications, with potential elimination of 5% RD on its final products (CRC, HDGC) narrowing the price disparity between imported and local product by ~PkR4-5k per ton. With imported re-bars prices remaining at a premium post RD removal, we continue to like ASTL on the back of strong earnings outlook (5yr forward NPAT CAGR of 30%).
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.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.