OMCs_Lubes and Storage Update
Two crucial data sets regarding the OMC sector are difficult to tabulate and verify, one is regarding lubricant sales and market shares, which are excluded from monthly OCAC volumes and other is mid-stream storage infrastructure. Updating our data sets through the annual OCAC Pakistan Oil Report 2016-17, we observe: 1) 47.9%YoY increase in lubricant sales volumes for FY17 steered by 73%YoY rise in passenger motor car lubricant sales, 2) SHEL maintaining leadership in the segment (44% market share), and 3) total storage infrastructure for POL products growing by ~131k tons, up ~4%YoY. In-line with expectations of an FO-lite future, these data sets show that the OMC space (listed players at the least) are ready to put power sectors consumers (and accompanying arrears) in the rear view. Re-iterating strong retail dynamics furthered by core drivers (motor vehicles on road/total industry sales climbing +4.4/+17.9%YoY for FY17), we remain upbeat on the sector with APL offering the highest upside (~20% to DCF based TP of PkR725/sh) at current levels.
Pakistan State Oil is a petroleum group based in Pakistan. Co.'s principal activities are the procurement, storage and marketing of petroleum and related products. Co. also blends and markets various kinds of lubricating oils.
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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