Pakistan Fertilizers: Strong Jul'18 draws inventory to 7yr low
Pakistan's fertilizer offtake remained promising in Jul'18, courtesy of early monsoon rains that came to the rescue spurring a delayed lift-off for Kharif season demand amid water scarcity. According to the latest NFDC read, total fertilizer sales in Jul'18 stood at 980k tons against 746k tons sold in Jul'17 (up 31%YoY/12%MoM). In tandem, Urea/DAP offtakes have increased by 46%/7%YoY to 497/302k tons during the month under review. Similarly, CAN/NP sales have also jumped by 83%/16%YoY to 99/56k tons in Jul'18. On a cumulative basis, total fertilizer sales posted nominal growth of 4%YoY to 5.06mn tons during 7MCY18 where urea offtake climbed 6%YoY to stand at 3.22mn tons. Backed by continuous improvements in industry dynamics, the fertilizer sector has gained 21%CYTD, outperforming the KSE-100 index by +13% during FY18. With this impressive run-up in the backdrop, we assert a Market-weight stance on the sector, where EFERT (TP of PkR87.8/sh) remains our top pick on an appealing dividend yield of ~11%, followed by FATIMA (TP of PkR45.1/sh).
EnGro Corp is an investment holding company. Co. is engaged in the manufacturing and selling of cement. Through its subsidiaries and associates, Co. is also engaged in the marketing and distribution of office automation products; manufacturing and sale of vermiculite; provision of liaison and coordination services to related companies; investment trading; retrofitting and restoration works to buildings and construction; and manufacture and sale of readymixed concrete.
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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