Pakistan Strategy_May'21_A month of all-time high volumes, (AKD Daily, Jun 01, 2021)
AKD Daily
Pakistan Strategy: May’21_A month of all-time high volumes
- Closing at 47,896pts, KSE-100 index gained 8.1% in May’21 – the highest monthly gain in 9 months. Investors preferring to remain sideways in the earlier part of the month, returned to the bourse after extended eid holidays and significant curtailment in COVID load, rejoicing positive inklings on the macro front.
- Within sectors, Engineering and Cements gained 18.1%MoM and 12.3%MoM respectively on expectation of FY22 budget likely favoring these sectors. OMCs gained 14.3%MoM on the back of potential release of first tranche by Govt. by the end of the week to clear circular debt whereas activity was also seen in the E&P space (+7.2%MoM) after Govt. shelved stake sell in OGDC and PPL.
- Flow wise, foreigners cumulatively sold US$43.4mn whereas excluding BYCO transaction where sponsor divested its holding, net sell stood at ~US$7.4mn. Mutual Funds and Banks also followed suit with net sell of US$7.4mn and US$4.7mn respectively. However, the selling was balanced primarily by Individuals and Others with a cumulative net buy of US$43.2mn.
- KSE-100 index is expected to continue its bull run boosted by liquidity flush currently prevailing in the market. As such, we advocate for sectors that fall on structural theme metrics (likely to also remain in favor in the upcoming budget) where our preferred sectors are Cements, Steel, and Construction-Allied on construction theme, and Power and select-OMCs (PSO) on payment in lieu of circular debt resolution.
AKD Research
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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