PSO_RLNG Conundrum Tamed; Geared Up for the Macro Upswing ,(AKD Daily, Mar 06, 2024)
PSO: RLNG Conundrum Tamed; Geared Up for
the Macro Upswing
Company’s receivable collection ratio for the RLNG segment has markedly improved over the past twelve months, averaging at 95% during CY23 (vs. 78% in CY22).
Specifically, cost of diverting RLNG amounting to PkR232bn has been incorporated into the tariff calculation for indigenous gas customers for the first time. The adjustment was for the sale of ~161MMCFD of RLNG towards system gas users for the full year.
With a more pronounced recovery in country’s economic activity come FY25, we expect PSO’s OMC sale penetration to remain strong amidst company’s far-reaching retail net work and aggressive market capture over the past 24 months.
PSO stands as our top pick from the sector, with a Dec’24 target price of PkR290/sh on the stock, offering upside potential of 73% over the last close.
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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