reports
- Muhib Ur Rasool
PPL: Margand; a potential game changer
There’s a lot of excitement in the E&P sector after PPL announced it’s first discovery in Margand Block. This is the second discovery in Kalat Plateau, and substantially enhances the play’s attractiveness for future exploration, potentially leading to big discoveries. Margand structure in itself is estimated to hold sizeable reserves. Given the significance of the discovery we have tried to gauge the potential of Margand X-01 in the most objective manner possible. Margand X-01 can potentiall...
- Muhib Ur Rasool
HTL: Weak 1Q earnings will create an ideal entry point
HTL: Weak 1Q earnings will create an ideal entry point HTL has appreciated 69% after hitting a low of PKR 17.0 in Aug-19 and 32% since we initiated coverage on September 20th with a strong BUY rating. Price recovery was driven by strong earnings recovery where the company posted bumper earnings for 4QFY19 at PKR 2.68/share, up 1.44x YoY. Pre-selling and local blending led to robust earnings growth in 4QFY19 Robust growth in 4QFY19 earnings was primarily driven by two factors (i) sig...
- Saad Nandia
Power Tariffs: Full cost recovery is not too far away
Power Tariffs: Full cost recovery is not too far away The recently approved IMF program has energy sector reforms as one of its key elements, with a focus on depoliticizing gas and power tariffs and gradually bringing the sector to full cost recovery over the program period. This is in contrast to the general perception that IMF may warrant energy sector full cost recovery as a precondition. We thought it would thus be useful to map the future path of electricity tariffs by compiling the plan...
- Muhib Ur Rasool
Kekra - 01: Making sense of the hype
A substantial amount of hype has been created around the recently commenced offshore exploratory drilling of Kekra-01 in Offshore Indus-G block. We, hence, thought it would be useful to reach out to industry experts and conduct some international benchmarking, to better understand prospects of Kekra-01 in the most objective manner possible. We share our findings in this piece
- Akseer Research
- Musadiq Jawaid
Auto sector update: Are volumes approaching an off-the-cliff fall?
Passenger car sales during 5MFY19 rose 1.0% YoY, which allowed listed automobile manufacturers to limit decline in volumes to 2.0% YoY during the period. Amid dismal volumetric performance by other vehicle categories (declines for LCVs, HCVs, Tractors and three wheelers ranged from -13% to -26%, while M/Cycles sales have remained flat), the outperformance of passenger car segment is likely to have been driven by 1) large order book at the start of the year, 2) pre-buying resulting from pre-an...
- Akseer Research
- Fariya Saleem
FFL: Short term headwinds change our stance to SELL
We change our recommendation to SELL on Fauji Foods Limited (FFL) due to a downward earnings revision for CY18, where we expect the gross margins to drag the profitability. Resultantly, we slash our Jun-19 PT to PKR 30/share, which indicates a downside of 11% from LDCP. We expect FFL liquid products’ sales to grow 57% YoY during CY18 on the back of increase in both UHT milk and Tea Whitener sales. Company’s market share in both the categories is likely to settle in at 7.0% and 24.0%, resp...
- Akseer Research
- Musadiq Jawaid
MTL: Increase in cost pressures amid diminishing volumes, HOLD
We revisit our investment case of MTL where we have revised down our Jun-19 price target PT to PKR 754/Share. Our PT implies a downside of 14.2% along with a dividend yield of 10.6%. The stock is valued rich and trading at PER of 9. 4x based upon strong dividend pay-outs history. We recommend ‘HOLD’. We expect the company’s bottom-line to grow by 6.2% per annum during FY19-23 on the back of 1) diffident growth in sales volumes 2) unsustainability of current historic high gross margins...
- Akseer Research
- Uzair Shaikh
MARI: Growth to gain momentum in FY19
â–ª We initiate our coverage on MARI with a Jun-19 price target (PT) of PKR 2,062/share. Out PT provides a potential upside of 53% along with 0.5% dividend yield. The stock is currently trading at FY19 PER of 5.6x. We have assumed oil prices at USD 60/bbl for FY19 and USD 60/bbl for the long term, whereas, our Jun-19 end PKR/USD assumption stands at 145.â–ª MARI HRL reservoir is estimated to maintain a plateau of 650mmcfd till Jul-23, against previous estimates of 640mmcfd plateau which was proj...
- Akseer Research
Federal Budget 2018-19: Massive reforms ahead of the elections
Federal Budget 2018-19: Massive reforms ahead of the elections Contrary to its populist appearance, Federal Budget FY19 is NOT a populist election year budget. It restricts non-filers of tax returns from purchasing all new motor vehicles, and property valued above PKR 4.0mn. Non-tax filers comprise 98% of Pakistan’s labor force. The budget introduces substantial punitive measures for concealment of foreign / domestic income / assets, thereby enhancing incentives to avail the amnesty scheme whic...
Unfortunately, this report is not available for the investor type or country you selected.
Report is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.