MEBL_ABL & BAFL_1HCY21 Result Previews, (AKD Daily, Aug 12, 2021)
AKD Daily
MEBL, ABL & BAFL: 1HCY21 Result Previews
MEBL to post earnings of PkR4.5/sh in 2QCY21: Meezan Bank Limited (MEBL) is due to announce its 2QCY21 result today where we expect the bank to post NPAT of PkR6.3bn (EPS: PkR4.5), taking the cumulative profitability during 1HCY21 to PkR12.4bn (EPS: PkR8.7). Along with the result, the bank is expected to announce a semi-annual dividend of PkR1.5/sh , taking cumulative payout to PkR3.0/sh. On a sequential basis, earnings are expected to grow by 4%QoQ largely on the back of better non-funded income whereas the funded income is also expected to grow marginally owing to robust book growth. The scrip trades at a forward PBV of 2.3x
ABL earnings to stand at PkR3.42/sh in 2QCY21: We forecast Allied Bank Limited (ABL) to announce 2QCY21 earnings of PkR3.9bn (EPS: PkR3.4), which will take the cumulative profitability to PkR8.0bn (EPS: PkR7.0) for the period, down 5%YoY. Bank is expected to announce 2QCY20 dividend of PkR2.0/sh, taking the total payout to PkR4.0/sh. Sequentially, earnings are expected to come off by 5%QoQ on the back of i) higher admin expenses, ii) higher effective taxation. However ABL may be able to surprise our estimates on the higher side by booking reversals (we have estimated provisioning expense of PkR200mn). The scrip trades at a forward P/B of 0.56x—BUY
BAFL EPS expected at PkR1.8 during 2QCY21: Bank Al Falah Limited (BAFL) 2QCY21 earnings are estimated at PkR3.2bn (EPS: PKR1.8), this translates into 1HCY21 earnings of PkR6.6bn (EPS: PkR3.7). Along with the result, we expect BAFL to announce cash dividend of PkR1.5/sh. On sequential basis, BAFL’s earnings are expected to recede by 6%QoQ, largely on the back of normalization of capital gains in the outgoing quarter which are expected to come off by 40%QoQ, amid high base effect. However, with BAFL maintaining and ADR of over 63%, no additional tax liability will be levied on the profitability and therefore we expect realized effective tax rate to settle around 39% . We have a BUY call on the scrip with a TP of PKR53/sh.
AKD Research
Meezan Bank Limited is an Islamic commercial bank. The Bank is engaged in corporate, commercial, consumer, investment and retail banking activities. It offers a range of Islamic banking products and services through a retail banking network of over 550 branches in approximately 140 cities to its corporate, commercial and small and medium-sized enterprise (SME) customers based on their financial requirements. It provides personal banking, business banking, premium banking and branchless banking. The Bank also offers Meezan Rupee Current Account, Karobari Munafa Account, Meezan Rupee Savings Account, Meezan Business Plus Account, Meezan Bachat Account, Meezan Kids Club Account, Meezan Teens Club Account, Meezan Asaan Current Account, Meezan Kafalah, Certificates of Islamic Investment, Meezan Amdan Certificate and Dollar Mudarabah Certificate. It has assets in agriculture, food, forestry and fishing; cement, and others. The Bank operates only in Pakistan.
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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