OMC: Retail Update 2QCY18
Amongst mounting set of dampeners for the OMC space, volumetric growth remains hinged on retail fuel sales. Hence, our quarterly analysis of sales volumes for HSD and MOGAS matched by quarterly retail outlets illustrate where future growth is expected to come from. For 2QCY18, we find strong retail network additions from HASCOL/PSO/APL with QoQ additions of 47/18/11 outlets, while SHEL continued to shed its retail footprint. Sales per outlet for listed OMCs reached 673.4Kltrs/outlet for 2QCY18 grew 6.1%QoQ but remaining flat YoY, signifying the limited impact of CNG and slowing discretionary demand for POL products. PSO's focus on retail operations seem to be paying off, as the state owned OMC grew its retail footprint (18 outlets added QoQ) while keeping sales per outlet on an uphill trajectory (580.6Kltrs/outlet rising 13%QoQ/6%YoY). Comfortable with our assumption for PSO (4.4%YoY growth in HSD and MOGAS sales through to FY20F) continued reliance on retail heavy CAPEX spurring growth for the state OMC, especially through its sizeable footprint, we have a TP of PkR399/sh on the stock, where an Accumulate stance is implied.
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.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.