Pakistan Fertilizers: Sector update Jul'17
Fertilizer offtake expectedly came down significantly in Jul'17 (down 32%YoY/48%MoM), post extraordinary sales of 1.43mn in the month of Jun'17 (up 106%YoY/100%MoM). According to latest figures released by NFDC, total fertilizer sales in Jul'17 stood at 746k tons against 1.10mn tons sold in Jul'16 (down 32%YoY/48%MoM). Similarly, urea sales also came down by 56%YoY/68%MoM to 339k tons during the month under review, after heavy urea procurement by dealers in Jun'17. Furthermore, imported urea sales declined by 5%YoY to 46k tons in Jul'17, despite availability at a significant discount to local urea. DAP sales on the other hand registered a growth of 42%YoY/153%MoM to 283k tons in Jul'17. On a cumulative basis, total fertilizer sales posted growth of 23%YoY to 4.88mn tons during 7MCY17 where urea offtake posted a decent recovery of 17%YoY to stand at 3.04mn tons. In the backdrop of industry's weak pricing power and relatively higher inventory levels (urea inventory standing at 1.15mn tons), we maintain our Marketweight stance on the sector until a sustainable improvement in the local and int'l pricing scenario emerges.
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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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