Pakistan Refinery_Near term profitability to remain strong
AKD Daily
Pakistan Refinery: Near term profitability to remain strong!
- News of possible ban by Europe on oil imports from Russia and historic low global diesel stocks have sent global diesel prices higher, while spreads are also touching historic highs, standing at USD30.35/bbl for first fifteen days of Apr’22, up 54% on fortnight basis.
- Refinery cracks for 3QFY22 have improved significantly compared to 2QFY22, with HSD/MS/FO spreads standing at USD11.89/8.58/-18.26/bbl against USD7.17/8.06/-12.80/bbl for 2QFY22. CNERGY will be the biggest beneficiary in our opinion with its weighted average refining margin increasing to USD2.0/bbl for 3QFY22 against USD0.1/bbl for 2QFY22, courtesy lower furnace oil yield.
- Unavailability of RLNG and plant outages resulted in increased power production on furnace oil which resulted in increased furnace oil yield for ATRL, NRL and PRL, and will become a drag on weighted average refining margins for these players, however possible higher run rates may set off some impact.
- Moving forward, refinery profitability can be expected to remain elevated in near term as dual impact of high refinery yields and increasing oil prices resulting in inventory gains impart its effect where even furnace oil spread has improved for first fifteen days of Apr’22.
AKD Research
Attock Refinery is engaged in the refining of crude oil and the manufacture of motor gasoline, solvents, jet fuels, kerosene, mineral turpentine, high speed diesel, light diesel oil, jute batching oil, furnace oil, cutback asphalts, paving grade asphalts and LPG. All of its products are consumed locally. Co., through its subsidiary, provides medical services to Attock Group Companies and the general public.
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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