NML: Negatives priced in; Buy
- We revisit our investment case on NML, post dismal 3QFY18 results (EPS: PRs0.28, down 82%YoY), and revise down our earnings estimates by 10% on average over our investment horizon. Our new FY19/20F EPS estimates are PRs11.72/13.02.
- The downward revision in earnings estimates emanates from (i) lower weighted average product prices by 2% than our previous estimates, (ii) fuel cost per KWh revised up by 22% to PRs 8.0/KWh following incorporation of LNG in the fuel mix and upward revision in Furnace Oil prices and (iii) lower dividends expected from NPL.
- We upgrade our stance on the scrip to Buy at our new TP of PRs160/sh (upside: 19% on LDCP). We highlight that the stock has shed 16.8% in 3M, partly due to posting the worst quarterly results in almost a decade. The stock is currently trading close to its FYTD low, whereas potential catalysts include the extension of Export Package.
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.
Intermarket Securities Limited (IMS) is a full service corporate brokerage firm based in Karachi, Pakistan. We service both domestic and international clients. IMS was ranked #2 Best Local Brokerage and #3 Best for Overall Country Research for 2016 by AsiaMoney.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.