Report
Shahrukh Saleem
EUR 9.34 For Business Accounts Only

Pakistan Cement_COVID-19 taking its toll on dispatches (AKD Daily, Jun 04, 2020)

Pakistan Cement_COVID-19 taking its toll on dispatches

  • Local cement dispatches for May’20 declined by 37.7%YoY as COVID-19 related restrictions, rainfall and slowdown in sales due to ramzan took its toll. For 11MFY20, local dispatches have declined by 2.7%YoY and now stand at 36.1mn tons.
  • Exports from North took a significant hit, declining by 95.4%YoY as border controls were imposed due to COVID-19 outbreak while South’s exports were dented by restrictions in place at export destinations.
  • Local prices in North have held their ground despite the questions raised by authorities though further price increase has come into question. However, local players are enjoying the space arising from decreasing fuel prices and interest rates.
  • We maintain LUCK (TP: PkR637.7/sh—41.6% upside), DGKC (TP: PkR106.9/sh—31.6% upside) and MLCF (TP: PkR38.3/sh—48.8% upside) as our preferred play from the sector with LUCK being the safest play with a diversified portfolio, while MLCF and DGKC have manageable debt levels where cost saving measures are expected to significantly improve efficiency.
Underlying
D.G. Khan Cement Co.

Co. is engaged in the production and sale of Ordinary Portland and Sulphate Resistant Cements.

Provider
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.

Analysts
Shahrukh Saleem

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