Topline Securities Limited - Hascol Petroleum (HASCOL) Hascol Petroleum (HASCOL): 4Q2016 EPS of Rs1.8, -15% YoY; DPS Rs3.5/share (In-line with expectations)

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Topline Securities Limited

EUR 8.70 For Business Accounts Only

Hascol Petroleum (HASCOL): 4Q2016 EPS of Rs1.8, -15% YoY; DPS Rs3.5/share (In-line with expectations)

HASCOL reported earnings of Rs1.8/share during the quarter, down 15% YoY. The earnings decline was anticipated as the company incurred exchange losses of Rs795mn on account of 5% rupee devaluation witnessed during Dec 2017.
Company’s sales improved by 69% to Rs49.8bn driven by higher oil prices and improved sales volumes. International oil prices surged by 25% whereas company’s total sales volumes were up 37% to 691k tons. Market share of the company increased to 11% in Dec 2017 as compared to 9% in Dec 2016 driven by strong growth in white oil sales.
As of result of strong growth in sales, gross profits of the company was up 65% to Rs2.9bn.
In line with company sales, distribution & marketing expense also rose by 64% to Rs876mn. On the other hand, other expense were up 75% to Rs1.1bn primarily due to exchange losses.
In 2017, company profits improved by 12% to Rs1.4bn (EPS Rs9.4) driven by strong sales and improving market share of the company in total oil sales of the company. Other income of the company which includes rent income, storage & handling income and profit on bank deposits was also up 105% to Rs417mn during the year.
Key risks to the stock includes: 1) rise in pump prices & slowdown in sales growth, 2) rupee depreciation & inability of the company to pass on the impact and 3) volatility in oil prices and inventory losses.

03/04/2018 5 EN

Underlying

Hascol Petroleum

Hascol Petroleum Limited is a Pakistan-based company, which is engaged in procurement, storage and marketing of petroleum and related products. The Company is involved in the sale of petroleum products, such as fuel oil, high speed diesel, gasoline, Jet A-1, liquefied petroleum gas (LPG) and lubricants. The Company offers products, such as Tiger Super, Rocket Diesel and Furnace Oil. The Company offers Fuchs Lubricants products, which include corrosion preventives, quenching oils, industrial lubricants, open gear lubricants, greases, automotive oil and metal working fluids. The Company also markets LPG as an automotive fuel through its retail network. The Company is engaged in owning, leasing and renting oil storage facilities, as well as importing petroleum products. The Company has storage facilities at Machike, Shikarpur and Daulatpur. The Company sells its product to dealers, government agencies and autonomous bodies, independent power project and other corporate customers.

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PK0108001014 Pakistan Stock Exchange Pakistan

Provider

Topline Securities Limited

Topline Securities is one of the fastest-growing brokerage houses in Pakistan. It has strong Equity Brokerage, Economic/ Equity Research, Commodity Trading and Corporate Finance & Advisory functions.

Topline Securities has been endowed with numerous awards by renowned international financial organizations. The highlights of which consists of the award for ‘Best Local Brokerage House of Pakistan’ by Asiamoney Brokers Poll (the largest Asia-focused equity services provider poll) in 2016 and ‘Best Equity Brokerage House’ by CFA Society Pakistan in 2015.

Previously, Topline Securities held the title for ‘Best Brokerage House’ for 4 consecutive years (2011-2014) by Asiamoney Brokers Poll. Other awards include the ‘Best Salesperson’ award by Asiamoney for 6 consecutive years (2011-2016), the ‘Arabia Fast Growth 500’ award and ‘Pakistan Fast Growth 100’ award in 2012 and 2013 by AllWorld Network.

JCR-VIS, a credit rating agency providing independent rating services in Pakistan has assigned initial rating of “A-2” for short term and “A” for long term to Topline Securities. Topline Securities is registered as Underwriter, Book Runner and Research Entity with Securities & Exchange Commission of Pakistan (SECP).

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Hascol Petroleum (HASCOL): 4Q2016 EPS of Rs1.8, -15% YoY; DPS Rs3.5/share (In-line with expectations)

Pakistan OMCs_OMC volumes rose by 28%YoY for May'22, (AKD Daily, Jun 02, 2022)

Pakistan OMCs_Retail fuels continue to remain strong! (AKD Daily, Jan 10, 2022)

Pakistan OMCs_APL continues to gain market share (AKD Daily, Jan 04, 2021)

Pakistan Strategy: Foreign selling at PSX; Will this trend continue in 2021?

Pakistan Strategy: Pakistan Outlook 2021 based on Topline Poll

Pakistan Automobiles: Car sales (including KIA) up ~63% YoY in Nov-2020

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