reports
- Ajay Kumar
 Oil prices up owing to production outages in the U.S Gulf of Mexico
Storms in the Gulf of Mexico remains bullish factor for oil price Oil prices turned positive this week on crude oil production outages in the U.S Gulf of Mexico due to threat of tropical storm and increased tensions in the Middle East. According to Reuters, nearly 70% or 1.3mn barrels per day of crude oil production has been cut in U.S regulated areas of the Gulf of Mexico of U.S. WTI crude closed at USD 60.21/bbl (+4.69% WoW) and Brent crude closed the week at USD 66.72/bbl, reporting a weekly...
- Ajay Kumar
- Talha Idrees
PSMC outperforms during March with sales up +23% YoY
The latest numbers released by PAMA reported auto sales of 22,878 units during March 2019 taking the cumulative sales to 185,757 units for 9MFY19. The 800cc category amongst the passenger car segment experienced 11.5% YoY increase during the month mainly due to removal of non-filers ban. Sale of LCV, vans and jeeps decreased 53.4% driven by lower sales of Toyota Fortuner, Hilux and Honda BR-V. Trucks and buses segment also witnessed a decline of 52% YoY. Pick-ups were up 8.6% YoY.
3QFY19 EPS likely to clock in at PKR 14.0
Pakistan Oilfields (POL) is scheduled to announce its 3QFY19 results on April 11, 2019, where we expect earnings to decline by 1% QoQ to clock in at PKR 3,973mn (EPS: PKR 14.0). Revenue is expected to decline by 5% QoQ on the back of lower oil prices and 3% QoQ decrease in oil flows. Absence of heavy exchange gains is also attributed to QoQ decline. We estimate the company to record net exchange gains of PKR 89mn in 3QFY19 as against PKR 357mn recorded in 2QFY19. Exploration expense is likely to...
- Ajay Kumar
ACPL to report an EPS of PKR 3.04 in 3QFY19
Attock Cement Pakistan Limited (ACPL) is scheduled to announce its 3QFY19 result on Thursday, April 11, 2019. We expect the company to post earnings of PKR 418 million (EPS: PKR 3.04) in 3QFY19, reporting a decline of 48% YoY despite 23% YoY growth in total dispatches. We expect gross margin for the quarter to decline to 26% due to decline in export price. We anticipate selling expenses to increase 2.2x times compared to SPLY due to significant rise in export dispatches while finance cost will r...
- Ajay Kumar
Total cement dispatches declines by 6.7% YoY in March
As per the data released by the All Pakistan Cement Manufacturers Association (APCMA), the industry dispatched 4.34mn MT during the month of March 2019, reporting a decline of 6.7% YoY, taking local dispatches for 9MFY19 to 29.29mn MT, down 6.4% YoY. But the export dispatches during the month continued its growth momentum, reporting a growth 22.8% YoY in March, taking total exports for first nine months up by 49% YoY. However total dispatches for the month of march remained down 6.7% YoY keeping...
- Shumaila Badar
Pakistan Textiles: In need of a stitch in time
IsmailIqbal Securities arranged a briefing on Pakistan’s textile industry yesterday. Speakers included Muhammad Ali Haroon, CFO of Al Karam Textile Mills; Imran Moten, CFO of Gadoon Textile Mills and Abdul Aleem, CFO of Gul Ahmed Textile Mills. The speakers covered the current challenges being faced by the textile industry, competitive position of Pakistan versus other countries and future outlook for the industry.
- Ajay Kumar
FCCL’s EPS for 2QFY19 to clock in at PKR 0.64
Fauji Cement Company Limited (FCCL) is scheduled to announce its 2QFY19 result on Monday, February 18, 2019. We expect the company to post profit after tax of PKR 889 mn (EPS: PKR 0.64) for the quarter, showing a growth of 8% YoY. We expect company’s topline to increase by 1.7% YoY reflecting higher selling price during the quarter. Moreover, we expect gross margins to remain slightly up despite higher coal price and currency depreciation. We expect FCCL to announce a cash dividend of PKR 1/shar...
- Ajay Kumar
- Talha Idrees
Introduction to Timeline - Fifth Edition
Introduction to Timeline - Fifth Edition Dear Clients, This is the fifth edition of our biannual publication - Timeline. The purpose of the Timeline remains same, to identify all events ahead that may have significant impact on the stocks listed on PSX. All sections remain same, as displayed in the table of contents. We welcome feedback, please contact us so we can further improvise our report. You may write at or contact us at 3-85. Please find in attachment: Additions Removals Post...
- Ajay Kumar
2QFY19 EPS is expected to clock in at PKR 2.16
International Steels Limited (ISL) is scheduled to announce its 2QFY19 result on Friday, 25th January, 2019. We expect earnings to grow by 11% on QoQ basis to stand at PKR 938mn (EPS: PKR 2.16) in 2QFY19. The earnings are likely to be supported by increase in price of Cold Rolled Coil (CRC) and Galvanized Iron (GI) amidst decline in international HRC prices. Our cash flow projections hint at less likelihood of cash payout along with 1H results.
- Talha Idrees
3QMY19 EPS likely to be down by 40% to PKR 4.32
Honda Atlas Cars Pakistan Ltd (HCAR) is scheduled to announce its 3QMY19 result on January 24, 2019. We expect the company to report earnings decline of 40% QoQ to stand at PKR 617mn (EPS: PKR 4.32) in 3QMY19. Despite price hike, margins are likely to contract to 4.7% in 3QMY19 as compared to 6.4% in 2QMY19. The decline is mainly attributed to currency devaluation amid decrease in volumetric sales during the period under review. For 9MMY19, we estimate EPS of PKR 18.89 (PAT: PKR 2,698 mn) which ...
AGP Limited | Company Update | Much needed price dose
We revise our estimates by 13-15% for AGP Limited (AGP) incorporating recently approved increase in product prices by Drug Regulatory Authority of Pakistan (DRAP). Subsequently, we hold positive stance on the stock with 11% upside to our December 2019 target price of PKR 101.0/share. AGP manages to capture higher than average increase in its drugs under hardship category which contributes approximately 12% in its sales mix (excluding Mylan portfolio). Moreover, 15% increase in all other drugs ha...
- Ajay Kumar
Oil prices continue to gain for second consecutive week
US supply data showed much higher supplies negatively im-pacting international oil prices in last two sessions of the week. But the inventory data was couldn’t erase the weekly gains on US-China trade talks which ended on good terms and buoyed markets. For the week, WTI prices were +7.6% up closing at USD 51.6/bbl while Brent and Arab Light closed at USD 60.5/bbl and USD 62/bbl, reporting weekly gains of 6% and 9.5% respectively.
- Shumaila Badar
Updating Target Prices on Revised Expectations
Following a number of negative surprises posted in the last earnings season, we have updated our earnings estimates and target prices for the Banks under our coverage. The major reason why Banks missed our expectations was that their respective net interest margins were unable to expand as we had expected. We now expect further contraction in 4QCY18, and an expansion from 1QCY19 onwards. We expect earnings for most banks to improve in CY19 due to (i) NIM expansion, (ii) continued earning assets ...
- Shumaila Badar
Reducing Target Price to PKR 183.5
We have reduced our June 2019 target price on United Bank Limited (UBL) to PKR 183.50 from our earlier TP of PKR 223.00. Our new target price implies a 40% upside from UBL’s last closing price, hence we are maintaining a positive stance on the stock. The major reason why we have reduced our target price is that we have revised our earnings estimates downwards. UBL had missed our earnings expectations for the last quarter due to a contraction in net interest margin, which surprised us. We now exp...
- Talha Idrees
Auto Sales remains flat in Oct’18
The latest numbers released by PAMA reported show auto sales of 24,850 units during the month of Oct’18, taking the cumulative sales for 4MFY18 to 83,201 units. The 800cc category amongst the passenger car segment experienced the decline in growth of 23.2% YoY during the month mainly due to decrease in sale of Mehran. Sale of LCV, Vans and Jeeps decreased 45.3% mainly due to decrease in sales of Toyota Fortuner and Honda BR-V. Trucks and Buses segment also witnessed decline of 9.9% YoY. Meanwhil...
- Shumaila Badar
Reducing Target Price to PKR 179.30
We have reduced our June 2019 target price on Habib Bank Limited (HBL) to PKR 179.30 from our earlier TP of PKR 230.80. Our new target price implies a 24% upside from HBL’s last closing price, hence we are maintaining a positive stance on the stock. The major reason why our target price has declined is that HBL has missed our earnings expectations for two quarters due to a significant hike in its administrative expenses. We now expect these expenses to remain higher for a longer period of time t...
- Shumaila Badar
Resuming Coverage with a TP of PKR 331.40
We are resuming coverage on Honda Atlas Cars (HCAR) with a June 2019 target price of PKR 331.40. Our new target price offers a 57% upside to the stock’s last closing price, hence we are adopting a positive stance on HCAR. We believe that the company is currently going through a tough operating environment, but we still believe that it is a good investment as the market appears to have over-reacted to its issues. We are assuming that gross margins will remain restrained in the future at a level o...
Fertilizer Off-take Grows by 15%YoY in September
According to National Fertilizer Development Center (NFDC), total fertilizer off-take increased by 15.03%YoY in September 2018. Further, on MoM basis, off-take increased by 20.61% in September. On the production side, Urea’s production was recorded 4.08% below previous month’s production. However, DAP’s production was recorded on higher side as compared to previous month. Urea inventory recorded a decline of 12.31% over August 2018 to reach the level of 115k MT. Going forward we expect Urea off-...
- Shumaila Badar
IBLHL in the Launching Phase of Several US, Chinese Products
Following are the most significant quotes from Financial Statements released this past week. IBL Healthcare’s (IBLHL) management is currently in the launching phase of several US and Chinese products.Pakistan International Container Terminal (PICT) is suffering from an adverse operational environment, which has been discussed in its Directors’ Report. Phillip Morris’s (PMPK) Directors too complained about the tough operating environment in their report.
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