Earnings Likely to Slightly Decline
Bank Al Habib Limited (BAHL) is scheduled to announce its results tomorrow, April 17, 2018. We expect the Bank to post earnings of PKR 2.1bn (EPS: PKR 1.92) in 1QCY17, 7.3% lower than the earnings posted in 1QCY17 and 5.0% lower than the earnings of 4QCY17. One of the reasons for the decline is that we are expecting BAHL to post a small amount of provisions charge instead of the net reversals posted in 4QCY17 and 1QCY17. Moreover, earnings are likely to be lower than that of 1QCY17 because of lower gains from sales of securities. Our December 2018 target price of PKR 81.40 implies a 9% upside to BAHL’s last closing price; hence we are adopting a neutral stance on the stock.
Bank AL Habib Limited is a banking company. The Bank operates through Retail banking, Commercial banking, Retail brokerage and geographical segments. Its Retail banking consists of retail lending, deposits and banking services to private individuals and small businesses. The retail banking activities include provision of banking and other financial services, such as current and savings accounts, and credit cards to individual customers, and small and medium enterprises (SMEs). Its Commercial banking represents provision of banking services, including treasury and international trade-related activities to corporate customers, multinational companies, and government and semi government departments and institutions. Its Retail brokerage activities include the business of equity, money market and foreign exchange brokerage, equity research, and corporate financial advisory and consultancy services. It operates in four geographic regions: Pakistan, the Middle East, Asia Pacific and Africa.
Ismail Iqbal Securities (Private) Limited (IISPL) is a TREC holder of the Pakistan Stock Exchange, as well as an SECP registered Underwriter and Book Runner. IISPL provides comprehensive financial services including Equity Sales, Research on Equities and the Macro-Economy, Investment Advisory, Portfolio Management, Corporate Finance, and extensive services for Private Equity investors. IISPL services a diversified client base, from Institutional to Retail Investors including High Net worth Individuals.
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