Pakistan Strategy - From dark clouds to sun-kissed skies CY23 Pakistan, (AKD Daily, Jan 01, 2024)
AKD Daily
Pakistan Strategy - From dark clouds to sun-kissed skies CY23 Pakistan
- CY23 has been the year with two clearly different halves with each portraying a different story. First half being full of macro headwinds, ending in a gain of 2.6% in 1HCY23.
- Meanwhile, in the second half, the tides began to turn with KSE100 outperformed all the global indices, posting returns of 50.7% (US$ return: 52.2%). IMF-Pakistan SBA of US$3bn acted as a catalyst, unlocking vital foreign inflows, along with measures like currency controls, a crackdown on smuggling, and the establishment of the SIFC.
- Overall, for the full year, KSE100 returns aggregate to 54.5%, closing at 62,451pts at the year end.
- Inflation remained high during the year, with CY23 expected to average at 30.9% vs. 19.7% in CY22. With stringent import restrictions in place, the current account showed restraint, reporting a deficit of just US$126mn for 11MCY23, a significant drop from US$11.8bn in SPLY.
- Company buybacks emerged as the dominant theme in terms of market flows, contributing a net US$129mn. On the contrary, mutual funds remained net sellers, offloading US$132mn.
- Looking ahead, market is expected to remain bullish in the near term, with valuations still attractive (forward PE below 4x), investors are advised to make positions in companies with robust fundamentals and attractive dividend yields.
AKD Research
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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