EUR 4.42 For Business Accounts Only

Intermarket Pulse: Pakistan OMCs: Strong show in Jul’17 sales

Overall OMC sales posted a strong growth of 12% YoY in Jul’17. Petrol sales rose 15% YoY, in line with its recent trend, but HSD sales were more impressive (up 39% YoY). Both indicate strong underlying demand, even as July is a peak demand month.

There was little change in the market shares of PSO and APL; but securing their shares in a very competitive environment is still laudable. HASCOL is likely to overtake Shell for the second position, as the latter remains lackluster in the retail fuel markets.

OMC margins for FY18 are yet to be notified, with two price revisions already gone. Given the transition going on in the government, further delay is likely. A PRs0.10/sh revision in margins contributes on average 5% to our FY18 EPS estimates for OMCs.