IMF Staff Report & Central Bank Governor Meeting
- The executive board of International Monetary Fund (IMF) released a detailed staff report of 96 pages yesterday and statement by the Executive Director for Extended Fund Facility (EFF) for Pakistan.
- The package also includes a Letter of Intent (LOI) signed by the advisor to the PM on finance Mr. Hafeez Sheikh and Governor State Bank of Pakistan (SBP) Mr. Reza Baqir.
- We believe 2019 IMF program with Pakistan is tough compared to previous programs. In 2013 there were only one indicative and 5 performance criteria. While in the current program, there are 5 indicative and 6 performance criteria.
- For the first time, the IMF has imposed a floor on Federal Board of Revenue’s (FBR) revenue to Rs5.5tn as an indicative criterion. We believe this will be the most difficult measures as failure to complete this will force govt. to impose more taxes in the latter part of FY20.
- The SBP governor also held an analyst briefing session today to discuss the outlook of Pakistan’s macro economic situation. Governor was confident that external commitments would be met. He was also optimistic as the main causes of the crisis has been addressed.
- Post FY20 Budget measures and IMF’s staff report, we raise our inflation forecast to 12-13% for FY20 from our earlier estimates of 11%. Further, we expect another hike of 100-200bps in interest rate by Dec 2019.
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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