Report
Hamad Aslam ...
  • Sharoon Ahmad
EUR 4.74 For Business Accounts Only

Pakistan Equity Market - Lack of Action in Finance Act Amendments

  • Amendments to Finance Act unveiled yesterday lack austerity measures that we think are required to trim the Twin Deficits
  • Revenue measures are projected to raise PKR183bn in additional collection while Federal Development Budget was cut by a meagre PKR255bn to PKR725bn; resultantly fiscal deficit for FY19 is expected to clock in at PKR2.3tn (6.0% of GDP)
  • While market cheered the lack of austerity measures, we were disappointed as we could not see any decisive measures that can meaningfully trim down the import bill; moreover, relaxations to non-filers and support for real estate market reflect contradictions within the policy actions
  • While the policy actions are clearly positive for Textiles and select Ferts, we expect continued overhang on measures to address BoP challenges will likely hand over the overall equity market back to bears
Underlyings
Agriauto Industries Ltd.

Agriauto Industries Limited is a holding company. The Company is engaged in the manufacture and sale of components for automotive vehicles, motor cycles and agricultural tractors. The Company's product range covers both original equipment manufacturers (OEM) and aftermarket. Its product range includes shock absorbers and struts, motorcycle shock absorber and parts, sheet metal press parts, tractor parts and other parts. It also caters to the requirements of the aftermarket customers. It manufactures complete shock absorber assembly and components for shock absorbers. It produces an array of sheet metal parts, re-enforcement instrument panel and door impact beam for OEM. It produces sheet metal parts for in-house use for shock absorbers and struts. It produces tractor steering boxes on automatic computer numeric control (CNC) machine, and also machines camshafts in both casting and forging for tractor assemblers.

Fatima Fertilizer Co. Ltd.

Fatima Fertilizer Company Limited is a Pakistan-based fertilizer manufacturing company. The Company is engaged in manufacturing and marketing of Nitrogen, Phosphate and Potash fertilizers. It produces a range of fertilizers, including Sarsabz Calcium Ammonium Nitrate (CAN), Sarsabz Nitro Phosphate (NP), Nitrogen Phosphorous Potassium (NPK) and Sarsabz Urea. Its CAN is a granulated nitrogenous fertilizer. Sarsabz Urea can be applied in various forms and it can be spread in bulk alone or can also be mixed with other fertilizers before application. Its NP can be applied on various types of soils. The Company has a production base for Nitric Acid. The Company has annual production capacity of Urea 500,000, CAN 420,000, NP 244,000, Nitric Acid 500,000 and Ammonia 500,000. It also offers services and support to farmers from education on farming practices and research oriented agricultural practices.

Gul Ahmed Textile Mills

Co. is engaged in the manufacture and sale of cotton and yarn.

Nishat Chunian

Nishat (Chunian) Limited. Nishat (Chunian) Limited is a Pakistan-based textile company. The Company is principally engaged in the business of spinning, weaving, dyeing, printing, stitching, processing, doubling, sizing, buying, selling and otherwise dealing in yarn, fabrics and made-ups made from raw cotton, synthetic fiber and cloth and to generate, accumulate, distribute, supply and sell electricity. The Company operates in four business segments, which include Spinning, which produces a range of yarn using natural and artificial fibers; Weaving, which produces a range of greige fabric using yarn; Processing and Home Textile, which is engaged in processing greige fabric for production of printed and dyed fabric and manufacturing of home textile articles, and Power Generation, which is engaged in generating and distributing power. The Company has a spinning production of approximately 75,000 tons of yarn, three million meters of greige fabric in weaving and four million meters of finished fabric per annum.

Nishat Mills Ltd.

Nishat Mills is engaged in the business of textile manufacturing and of spinning, combing, weaving, bleaching, dyeing, printing, stitching, buying, selling and otherwise dealing in yarn, linen, cloth and other goods and fabrics made from raw cotton, synthetic fiber and cloth, and to generate, accumulated, distribute and supply electricity.

Provider
Elixir Securities
Elixir Securities

Elixir Securities Pakistan is a Corporate Member of the Pakistan Stock Exchange & Pakistan Mercantile Exchange and is one of the leading securities brokerage & investment banking firms in Pakistan, established since 1994. Our principal business activities include all aspects of Pakistan’s Capital Markets covering Securities Brokerage (Equities, Fixed Income and Commodities), Corporate Finance & Capital Markets Advisory (M&A, ECM, DCM) and Investment Research (Economics & Securities). We are one of the most active & aggressive Broker-Dealers in Pakistan executing trades for most of the Top 20 Global Brokers with unmatched corporate access credentials and have successfully advised and closed on some landmark ECM transactions in the history of Pakistan including the largest deal in frontier Asia (USD 1.02 billion). Our Clients include foreign and domestic financial institutions (Banks, Asset Managers, Insurance Companies, Pension Funds) corporates, HNWI’s and retail investors. This is supported by a very strong and independent research capability, which is quoted regularly in both local and international media.

Elixir Securities Pakistan is the proud recipient of many awards & recognitions including AsiaMoney’s Brokers Poll 2017, FinanceAsia’s Pakistan Best Investment Bank and Best Broker 2017, The Asset’s Best Brokerage House in Pakistan 2016, Asiamoney’s “Best Domestic Equity House 2015 in Pakistan”, The Asset Triple A Country Awards 2015 - Pakistan “Deal of the Year” and “Deal of the Year-Highly Commended”, CFA Society of Pakistan Awards for Year 2015 “Best Research Analyst (1st Rank), CFA Society of Pakistan Awards for Year 2014 “Best Research Analyst (1st Rank)”, “Best Trader” 2nd Runner-up (3rd Rank), The Asset Triple A Country Awards 2014’s “Best Deal in Pakistan” and Capital Finance International’s nomination for “Best Equity Research in Pakistan 2010”.

Analysts
Hamad Aslam

Sharoon Ahmad

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