Pakistan Fertilizers: Offtake continues to shine
Backed by continued GoP support (subsidies), Pakistan’s fertilizer sales remained promising in April’18. According to the latest figures released by NFDC, total fertilizer sales in Apr'18 clocked in at 570k tons, up 27%YoY. In tandem, urea sales have also jumped by 50%YoY/10%MoM to 375k tons in April’18. DAP sales on the other hand remained under pressure during the month (down 28%YoY/54%MoM) owing to seasonal slowdown and above average offtake in previous months. On a cumulative basis, total fertilizer sales posted an encouraging growth of 27%YoY during 4MCY18 where urea offtake posted a robust growth of 50%YoY in the review period. The fertilizer sector has posted a strong recovery (market capitalization is up 22% since Aug'17 and +9%CYTD) on improving fundamentals. Going forward, we anticipate the improvement to continue on the back of: 1) lower inventory levels (high demand against low production), 2) elevated landed cost of imported fertilizers, currently hovering around PkR1850-1900/bag (owing to relatively stable int’l prices along with sharp PkR depreciation against US$) and 3) continuous upward trend in local product prices (currently standing above PkR1500/bag). Maintaining our Marketweight stance on the sector, EFERT (TP of PkR87.8/sh) remains our top pick on the basis of attractive dividend yield of ~11% at current price level, followed by FATIMA (TP of PkR45.1/sh) with its diversified product mix and an equally attractive dividend yield of above 10%.
Engro Fertilizers Limited is a Pakistan-based company, which is engaged in manufacturing, purchasing and marketing of fertilizers. The Company's brands include Engro Urea, Engro NP, Engro DAP, Zingro, Engro MOP, Engro SSP and Engro Zarkhez. Engro NP is the Company's fertilizer brand with Nitrogen and Phosphorous content in equal quantity. Engro DAP primarily contains Di-Ammonium Phosphate, and is imported by Engro EXIMP and marketed by the Company. Engro DAP is marketed in approximately 50 kilogram bags. Zingro is a micronutrient fertilizer, and is imported by Engro EXIMP and marketed by the Company. Engro Zarkhez has Nitrogen, Phosphorous and Potassium, and is primarily offered for sugar cane, fruit orchards, vegetables, potato and tobacco farming. Engro Envy is primarily offered to urban market for gardens, lawns, flower beds, fruit plants and ornamental plants. The Company is a subsidiary of Engro Corporation.
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.