Pakistan Economy_CAD sequentially improved; challenges remain
Current account deficit for Dec'17 recorded at US$1.13bn, lower than US$1.41 for Nov'17 (vs. US$1.352bn in Dec'16) on the back of: 1) healthy remittances flow for the month (US$1.723bn in Dec'17, up 9.3%MoM) and 2) improvement in trade deficit (US$2.68bn, down 4.0%MoM). However, cumulatively current account marks a deficit of US$7.41bn in 1HFY18, up by 59.1%YoY reflecting an expanding trade deficit (+24.2%YoY) where higher imports (particularly oil and machinery) outpaced relatively lower recovery in exports. On the positive side, foreign investments dynamics have been encouraging so far, with Net FDI standing at US$1.38bn (ex.acquisition of EFOOD's in Dec'16, cumulative FDI is up 44%YoY), while relief has also come from recent issuance of Eurobond (US$1.5bn) and Sukuk (US$1.0bn) in Dec'17 taking total net investment flows to US$3.621bn in 1HFY18. Going forward, current account weakness is expected to continue where we estimate CAD to clock in at ~US$15.627bn (4.9% of GDP) in FY18F underpinned by: 1) weak trade outlook (FY18F trade deficit: 13.7% YoY) and 2) plateaued remittance flows.
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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