Report
EUR 8.70 For Business Accounts Only

Aisha Steel Mills Limited : Expansion to provide multi-pronged growth!

We initiate coverage on Aisha Steel Mills Limited (ASL), a flat steel producer, with a ‘Buy’ rating and a DCF-based TP of PKR27.05/sh (32% total return). ASL commands 36% market share in Pakistan’s flat steel industry which operates under a duopoly. ASL’s two-pronged expansion target include; (i) Pakistan’s growing consumer theme and infrastructure investment, and (ii) product enhancement via entry into high-margin segment. Combination of volume growth and margin accretion will likely deliver ASL an impressive earnings growth of 46% p.a. over FY18-FY20E. 

Underlying
Aisha Steel Mills

Aisha Steel Mills Limited. Aisha Steel Mills Limited is a Pakistan-based company, which is engaged in the primary business of manufacturing and selling cold rolled steel in coils and sheets. The Company produces cold rolled coils from imported hot rolled coils. The Company offers cold rolled coils products to the industrial, engineering and manufacturing industry as a raw material for transformation into a range of value added products for the domestic and export markets. The Company has a cold rolling complex in the downstream Industrial Estate, Pakistan Steel, Bin Qasim, Karachi. The Company's cold rolling complex has a capacity to produce 220,000 metric tons of cold rolled coils per year.

Provider
BMA Capital Management Limited
BMA Capital Management Limited

​BMA is amongst the leading financial groups in Pakistan. BMA Capital’s core areas of business include Capital Markets, Corporate Finance & Advisory, Asset Management, and Financial Products Distribution. BMA Capital is the leader in privatisation advisory in Pakistan, having successfully advised on over 50% of all privatisations in Pakistan, by value, in transactions valued in excess of US$4 billion. Recent transactions include joint lead managing the $813 million GDR Offering of 10% of OGDCL on the London Stock Exchange in 2006-07, and advising Etisalat on their successful acquisition of a 26% strategic stake in Pakistan Telecommunications Company Limited (PTCL) for US$2.6 billion, the largest M&A transaction and foreign direct investment in Pakistan’s history. The firm is among the top brokers in the Pakistan equity and treasury markets, and is among a handful of firms that comprehensively cover all segments of the capital markets. This is supported by a very strong and independent research capability, which is quoted regularly in both local and international media. BMA Capital’s retail brokerage brand, BMA Trade, has launched a nationwide network of branches as well as a comprehensive online trading platform, enabling investors across Pakistan to take part in the capital markets.

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