MEBL_Strong Deposit Growth Setting the Bank Apart, (AKD Daily, Feb 22, 2023)
AKD Daily
MEBL: Strong Deposit Growth Setting the Bank Apart
- MEBL posted a stellar result for 4QCY22, with the bank reporting NPAT of PkR16.4bn (EPS: PkR9.2), higher by 43%QoQ and 87%YoY. The higher earnings in the last quarter was driven by expansion in the net profit earned, increasing by 40%QoQ.
- The bank’s Current Accounts at the end of the year stood at ~49% of total deposits, compared to 45% at CY21 close. Furthermore, the bank’s CASA has improved to 88%, compared to 83% at the end of CY21.
- MEBL’s deposits have grown at a CAGR of 19.8% over the past 5 years, while the industry deposits have grown at a substantially lower rate of 13% during the same period.
- The bank’s ADR currently stands at 61%, keeping it shielded from the taxation measures. Furthermore, the bank has increased its coverage to 166%, protecting its book from economic shocks.
- Our updated Dec’23 target price on the stock stands at PkR171/sh, which offers an upside potential of 78% to its last close and 12% higher than our earlier price target.
AKD Research
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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