Team AKD Research
EUR 9.28 For Business Accounts Only

Budget FY18_Proposals and Implications

The incumbent government is due to present its last federal budget on May 26'17 where we expect the government to move ahead with its growth agenda. Setting an ambitious GDP growth target of 6% in FY18F, the GoP is likely to enhance its development expenditure primarily making its case on uptick in CPEC led activity, with news flows suggesting federal PSDP allocation at PkR1,001bn vs. PkR800bn in FY17B. However, fiscal constraints will remain in play where higher tax collection is likely to be supported by increase in duties and continued penalization for non-filers. For capital market, incoming PSX proposals including: 1) reduction in CGT, 2) bonus tax applicability on face value instead of the value of the bonus issued, 3) extension in tax credit for new listings to five years and 4) reduction in corporate tax rate to 30%, entail positive implications, attempting to increase the depth in the market. Specifically, we feel continued support will be extended to exporting industries via relief packages (positive for Textiles) while infrastructure focus is to keep Construction and Allied sectors (positive for Cements, Autos) in limelight. Banks might bear the brunt of additional taxation measures (continuation of super tax likely) alongwith Dairy manufacturers in case of any increase in sales tax on tea whiteners.

AKD Securities Limited
AKD Securities Limited

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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