AKD STOCK SMART
The market opened the week on a weak note, tumbling down by 2.12% in the first trading session, as Pakistan was slapped with a penalty of US$5.8bn on Reko Diq case, over the weekend. SBP announced Monetary Policy on 16th May’19 and increased interest rates by 100 bps to 13.25%. While SBP hinted towards an end of monetary tightening era in its Monetary Policy statement, the market remained lackluster amid frail investor confidence. Meanwhile, FBR chairman continued to tighten its noose on non-filers across different sectors to meet IMF’s stringent demand to increase tax to GDP ratio by 4-5 ppt in FY20. Towards the end of the week, KSE-100 took another nosedive as NAB arrested former PM, Shahid Khaqan Abbasi on 18th July on LNG case. Other major news-flow included: (i) FDI dropped 50% to US$1.73bn in FY19, hitting a five year low, (ii) interest rate hiked to 13.25%, (iii) CAD shrunk 32% in FY19 to US$13.6bn, (iv) terming the traders’ recent countrywide strike ‘politically motivated’, the federal cabinet on Tuesday resolved not to withdraw its decision on registration of traders to bring them under the tax net, and (v) massive import under invoicing data came to the forefront through an analysis from Web-Based One Customs System Glo (WeBOC-Glo). Top performers during the week in AKD Universe were LUCK (+1.79%), and EFOODS (+0.74%) while NCL (-15.58%), NML (-14.83%) and PAEL (-14.78%) remained the worst performers. Average daily turnover significantly improved, increasing 107% WoW to 105mn shares, led by 1) MLCF (14.41mn shares), 2) TRG (12.18mn shares), 3) KEL (11.09mn shares), 4) PAEL (7.62mn shares) and 5) BOP (7.30mn shares).
Outlook
The market during the upcoming week will be dominated by the result season and PM’s visit to the US, scheduled for 22nd July. We advise investors to take a longer term investment perspective as the market is set to rebound with improving economic indicators. Banks, E&Ps, and selected Power and OMCs remain our preferred sectors amid the dynamics on a macro level.
AKD Research
Lucky Cement Corporation. LUCKY CEMENT CO. is a Taiwan-based company principally engaged in the manufacture and distribution of cement and clinker. The products of the Company include type I cement, type II cement, furnace powder, premixed concrete, limestone, stone and sand stone, among others. Its products are applied in the construction of ordinary engineering, underground engineering and concrete projects, among others. The Company operates through two segments. The Cement segment is engaged in the manufacture and sales of cement and related products. The Others segment is engaged in other businesses. The Company mainly operates businesses in Taiwan market.
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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