stock smart weekly (jan 31 2014)

8/13/2019 Stock Smart Weekly (Jan 31 2014)

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AKD Researc [email protected] 111 253 111

Weekly Review

The KSE-100 Index shed 0.81%WoW to close at 26,784 points with average daily turno-ver coming off by 3.48%WoW to 299.5mn shares. Volumes, however, picked up in thelast day of trading as the market gained up to 0.92% in intra-day trading with Cementsbeing the key gainers. Key news flows during the week were 1) strategic dialogue be-tween Pakistan and the US commenced while the US stated that the next tranche ofUS$352mn under the CSF has been approved with disbursement likely by Feb 614, 2)IMF announced the next review of Pakistans program to be held in Dubai from Feb 114onwards, 3) Chinese investors expressed keen interest in Pakistans textile space, 4) theSBP gave permission for government securities to trade on the stock exchanges, and 5)work on the Thar coal project commenced today. Political noise also remained in thelimelight with PM Sharif forming a 4-member committee to hold talks with the TTP whilethe Supreme Court dismissed former President Musharrafs plea and barred him fromleaving the country. Key gainers during the week were SHEL (+3.5%WoW on expecta-tions of increase in OMC margins and a potential buy-back by the parent company), ICI(+3.4%WoW), DGKC (+1.6%WoW), POL (+1.2%WoW), AICL (+1.1%WoW). Top losersduring the week included HCAR (-9.2%WoW), LOTCHEM (-6.8%WoW after the companyposted a loss in CY13), EFOODS (-5.5%WoW), HUBC (-4.6%WoW after NEPRA refusedto formulate a coal conversion tariff for IPPs) and HBL (-4.5%WoW). Volumes during theweek were led by ANL (115.26mn shares), BOP (111.97mn shares), JSCL (88.47mnshares), FCCL (67.66mn shares) and LPCL (43.44mn shares).

St ock Sma r t AKD Equity Research / Pakistan

Pakistan Weekly Update

Important disclosures including investment banking relationships and analyst certification at end of this report. AKD Securities does and seeks to do business with companiescovered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of the report. Investorsshould consider this report as only a single factor in making their investment decision.

Important disclosures

Copyright2014 AKD Securities Limited. All rights reserved. The information provided on this document is not intendedfor distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would becontrary to law or regulation or which would subject AKD Securities or its affiliates to any registration requirement withinsuch jurisdiction or country. Neither the information, nor any opinion contained in this document constitutes a solicitationor offer by AKD Securities or its affiliates to buy or sell any securities or provide any investment advice or service. AKDSecurities does not warrant the accuracy of the information provided herein.

www.akdsecurities.net

AKD SECURITIESMember: Karachi Stock Exchange

Find AKD research on Bloomberg(AKDS), firstcall.com

and Reuters Knowledge

The result season should continue to drive market sentiment going ahead, where keyresults next week include PTC, EFERT and EPCL. Moreover, with expectations of softCPI numbers for Jan14 (AKD estimate: 7.5%YoY), we expect market sentiment to re-main buoyed with leveraged sectors such as Cements and Textiles expected to be in thespotlight.

Outlook

Index & Volume Chart

Source: KSE & AKD Research

Universe Gainers & Losers

31 January 2014

Top-5 Volum e Leaders

Sym bol Volum e (m n)

ANL : 115.26

BOP : 111.97

JSCL : 88.47

FCCL : 67.66

LPCL : 43.44

10.0%

8.0%

6.0%

4.0%

2.0%

0.0%

2.0%

4.0%

6.0%

S H E L I C

I

D G K C

P O L

A I C L

H B L

H U B C

E F O O D S

L O T C H E M

H C A R

26,784

26,608

26,59626,654

26,671

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

27 Jan 28 Jan 29 Jan 30 Jan 31 Jan

(Shrs'000)

26,500

26,550

26,600

26,650

26,700

26,750

26,800

(Index)

Ready Volume (LHS) KSE100 Index (RHS)

Indices KSE-100 KSE-30This week 26,784 .34 19,296 .75Last week 27,002 .89 19,601 .60Change -0.81% -1.56%

Indices KMI-30 AllshareThis week 44,186 .56 20,244 .31Last week 44,716 .71 20,302 .40

Change -1.19% -0.29%

Mkt Cap. PkRbn US$bnThis week 6 ,607 .30 62.65 Last week 6 ,623 .62 62.81 Change -0.25% -0.25%

Avg. Daily Turnover (' mn s har es)This week 299.49 Last week 310.28 Change -3.48%

0

100

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300

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700

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(mn) (Index)

15,000

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28,000

Volume (LHS) KSE-100 Index


2/10

AKD Securities Limited31 January 2014

StockSmartPakistan Weekly Update

This Weeks Daily Reports

2

Jan 31, 2014

Jan 30, 2014

PTC: CY13 Result Preview, AKD Daily (January 31, 2014)

Pakistan Telecommunication Company Limited (PTC) is scheduled to finalize its full-year CY13 result over the weekend with result announcement on Monday Feb 3'14. Ona consolidated basis, we expect PTC to post NPAT of PkR15.07bn (EPS: PkR2.95) inCY13 vs. NPAT of PkR8.00bn (EPS: PkR1.57) in full-year CY12 translating into agrowth of 88%YoY. However, factoring out extraordinary items (primarily the one-offVSS expense booked in 3QCY12) results in normalized pre-tax growth of 10%YoY.Sequentially, we expect 4QCY13F consolidated earnings to clock in at a relatively weakPkR2.71bn (EPS: PkR0.53), lower by 9%QoQ with the ICH mechanism resulting inlower incoming traffic (reportedly less than 500mn minutes per month vs. more than1.5bn minutes per month pre-ICH). On an unconsolidated basis, we expect PTC to postNPAT of PkR12.00bn (EPS: PkR2.35) in full-year CY13F. Alongside the result, we ex-pect PTC to announce a final dividend of PkR1/share, to bring the full-year CY13 divi-dend to PkR2/share (payout ratio: 68%). However, there is the off chance that manage-ment decides to retain earnings ahead of the 3G auction. At current levels, PTC tradesat a CY14F P/E of 8.35x where our target price of PkR29.7/share implies a Neutralstance. In our view, a conviction call on PTC is dependent on pricing of the 3G auction,possible acquisition of Warid Telecom and clarity on the ICH mechanism post Telenor'sexit from the same.

EFERT: CY13 Result Preview, (January 31, 2014)

Engro Fertilizers Limited (EFERT) is scheduled to announce its full-year CY13 result onFeb 7'14. We expect the company to post earnings of PkR5.6bn (EPS: PkR4.36) inCY13F compared to a loss of PkR2.9bn (LPS: PkR2.3) during full-year CY12. In4QCY13 alone, we expect the company to post earnings of PkR2.4bn (EPS: PkR1.87),a stellar growth of 34.1%QoQ. Our earnings growth in 4QCY13 is premised on i) ureavolumes of 493.8k tons and combined phosphate (NP & NPK) volume of 29.0k tons, ii)GMs of ~47.0%, iii) higher 'other income' at PkR380.5mn with the company havingcombined ST Investments and cash balances of PkR11.7bn at end 3QCY13 and iv) flatfinancial charges at ~PkR2.6bn. Following approval of concessionary gas rate for EF-ERT on Jan 16'14, the scrip has witnessed tremendous investor interest, closing atconsecutive upper locks in each trading session to-date. At a price of PkR47.4/share atclose of today's first trading session, we believe buying interest may now start to wane.Going forward, while the GoP has approved the concessionary gas rate for Enven, con-fusion remains over the applicability of concessionary rate on gas from the Mari net-work. Any clarity on this will likely result in a second round of investor interest. At cur-rent levels, we have an 'Accumulate' stance on EFERT with a TP of PkR55.45/ share.

Dec'13 Ferti lizer Offt ake Update, AKD Daily (January 30, 2014)

According to official statistics released by the National Fertilizer Development Centre(NFDC), total urea offtake in CY13 stood at 5.89mn tons, an increase of 13%YoY,where strong demand and higher gas availability to EFERT led the growth. While ureaofftake in Dec'13 surged to 674k tons (up by 22%MoM), market share was dominatedby NFML. However, with the winding up of NFML and gas supply expected to continueto EFERT's Enven through 1HCY14, import requirements should remain minimal goingforward. DAP offtake in CY13 stood at a 4-year high of 1.62mn tons led by record pro-duction by FFBL and a 25%YoY increase in imports. Importantly, urea/DAP consump-tion ratio in CY13 dropped to 3.6x vs a 10-year average median of 6.8x, and we expectthe trend to endure as input costs for urea continue to increase. At current levels, FAT-IMA and EFERT remain our top picks in the sector with respective TPs of PkR35/shareand PkR55/share.

Banks_Could see provisioning reversals in 4QCY13, AKD Daily (Januar y 29, 2014)

Although weighted average spreads dropped close to 6% in Dec'13 (-22bps MoM/-52bps YoY), incoming data suggests positives for both full-year CY13 and 1HCY14banking sector results. In this regard, weekly SBP data indicates that combined provi-sions carried by scheduled banks (domestic operations only) have reduced byPkR9.1bn in 4QCY13 which indicates the possibility of +ve earnings surprises in up-coming results (NBP/AKBL could be two possible candidates in our view). At the sametime, although spreads have ended CY13 on a very soft note, margin contraction in

26,590

26,627

26,664

26,701

26,738

26,77526,812

26,849

9 : 0 8

9 : 5 2

1 0 : 3 6

1 1 : 2 0

1 2 : 0 4

1 2 : 4 7

1 3 : 3 0

1 4 : 1 3

1 4 : 5 7

1 5 : 4 2

1 6 : 2 7


Jan 28, 2014

26,510

26,538

26,566

26,594

26,622

26,650

26,678

9 : 2

1

1 0 : 1

4

1 1 : 0

5

1 1 : 5

6

1 2 : 4

7

1 3 : 3

8

1 4 : 3

0

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1

26,460

26,495

26,530

26,565

26,600

26,635

26,670

26,705

9 : 2 1

9 : 5 8

1 0 : 3 4

1 1 : 1 0

1 1 : 4 7

1 2 : 2 3

1 3 : 0 0

1 3 : 3 6

1 4 : 1 2

1 4 : 4 9

1 5 : 2 6

Jan 29, 2014

26,550

26,630

26,710

26,790

26,870

26,950

27,030

9 : 1 9

1 0 : 1 0

1 1 : 0 1

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1 2 : 4 1

1 3 : 3 2

1 4 : 2 2

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3/10



This Weeks Daily Reports

3

Dec'13 is largely a result of higher deposit costs and continued decline in lending yields

that have yet to re-rate. As higher interest rates price into lending yields, spreads for1HCY14 are likely to be incrementally better, thereby providing impetus to next year'sperformance. Banks moved in tandem with the broader market in CY13 but we believeoutperformance could now be on the cards, particularly in the run-up to full-year resultannouncements. At current levels, we like UBL (TP: PkR145/share), ABL (TP: PkR95/share) and NBP (TP: PkR62.5/share).

Jan'14 CPI Preview, AKD Daily (January 28, 2014)

With result season yet to pick pace, incoming macroeconomic data is likely to set thenear-term tone. In this regard, after having clocked in at 9.2%YoY in Dec'13, we expectheadline CPI to remain in single digits in Jan'14 to clock in at ~7.5%YoY. This trans-lates into a 0.1%MoM increase which is much lower than the 0.9%MoM CPI averageincrease in 1HFY14. While SPI data suggests a steep 0.95%MoM decrease, the steadysequential price pressure in CPI is expected on the back of 1) impact of rental inflation

(first month of the quarter), and 2) increase prices of non-perishable food items(particularly chicken). This should lead to 7MFY14 CPI averaging 8.7%YoY vs. 8.3%YoY during the same period last year. As a result, provided the exchange rate retainsits newfound stability, the DR may remain unchanged in the next MPS as well (due inMar'14). This could provide the catalyst for further market performance across the nextfew months where so far incoming results (with the exception of EFOODS) have beenrobust. From an investment perspective, we would avail any dip in the market to buildfresh positions in names such as UBL, NBP, NML, DGKC and ENGRO.

KAPCO: 1HFY14 Result Preview and Out look , AKD Daily (January 27, 2014)

KAPCO is scheduled to announce its 1HFY14 result on Feb 18'14, where we expectthe company to post NPAT of PkR3,495mn (EPS: PkR3.97), a decline of 5%YoY, alongwith a cash payout of PkR3.5/share. The decline is expected on the back of highmaintenance cost due to major overhaul of steam and gas turbines, which was com-

pleted in Nov'13. 2QFY14 earnings are expected to remain flat on a sequential basis atPkR1,769mn (EPS: PkR2.01). While liquidity conditions are gradually weakening withrunning finances expected to be near exhaustion, we expect fuel cost savings from aplanned conversion of plant's auxiliary heat load to coal from FY15. In this regard, whilewe still await details on the project, back of the envelope calculations indicate savingsof ~PkR450mn (EPS impact: PkR0.51) annually. At current levels, KAPCO trades at anFY14F P/E of 7.5x and D/Y of 13%. While our revised TP of PkR65/share implies aNeutral stance, KAPCO remains one of the top defensive picks in the AKD Universe.


4/10



4

Commodities

International Major Currencies

Source: Bloomberg

Source: Bloomberg

Major World Indices Performance

Source: Bloomberg

TRJ-CRB Index

Source: Bloomberg

PkR/US$ Trend

Source: Bloomberg

Regional Valuatio ns (2014)

Source: Bloomberg & AKD Universe

270

275

280

285

290

295

300

305

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EPS Growth PE(x)Pakistan 20% 8.61 Indonesia 13% 10.28 Malaysia 17% 11.41 Philippines 10% 14.52 Vitenam 15% 14.37 India 19% 12.60 China 15% 6.88

% ROE Divd YldPakistan 21.19 5.93 Indonesia 18.62 2.66 Malaysia 13.64 3.52 P hi li ppines 1 4.7 8 2.58 Vitenam 18.44 n.aIndia 17.51 1.93 China 14.00 4.06

97.0

99.0

101.0

103.0

105.0

107.0

109.0

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3

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3

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SPOT Units 31 Jan 14 24 Jan 14 WoW CYTDTRJCRB Points 283.56 282.54 0.36% 1.21%

Nymex (WTI) US$/bbl. 97.25 96.64 0.63% 1.19%

ICE Brent US$/bbl. 107.67 109.15 1.36% 2.84%N. Gas Henry Hub US$/Mmbtu 5.27 5.65 6.73% 21.32%

Cotton USd/Pound 92.25 93.75 1.60% 2.84%

Gold US$/Tr.Oz 1248.97 1270.07 1.66% 3.59%

Sliver US$/Tr.Oz 19.325 19.915 2.96% 0.74%

Copper US$/MT 7135.5 7211 1.05% 3.26%Platinum US$/Oz 1385.38 1431.25 3.20% 1.16%

Coal US$/MT 80.4 80.4 0.00% 4.96%

SPOT 31 Jan 14 24 Jan 14 Chg +/ WoW CYTD

Dollar Index 81.152 80.458 0.694 0.86% 1.40%

USD/PkR 105.470 105.477 0.007 0.01% 0.14%

USD/JPY 102.210 102.310 0.100 0.10% 2.94%

EUR/USD 1.352 1.368 0.016 1.16% 1.62%

GBP/USD 1.646 1.648 0.002 0.14% 0.59%

AUD/USD 0.871 0.868 0.003 0.33% 2.30%

NZD/USD 0.810 0.821 0.011 1.34% 1.34%

CHF/USD 0.905 0.895 0.010 1.12% 1.30%

CAD/USD 1.120 1.109 0.011 0.98% 5.40%

USD/KRW 1,081 1,080 0.610 0.06% 2.97%

CNY/USD 6.061 6.048 0.013 0.21% 0.11%

Country Bloomberg Code 31 Jan 14 24 Jan 14 WoW CYTD

Pakistan KSE100 Index 26,784 27,003 0.81% 6.03%

Srilanka CSEALL Index 6,248

6,256

0.12% 5.67%Thailand SET Index 1,274 1,315 3.07% 1.88%

Jakarta JCI Index 4,419 4,437 0.42% 3.38%Malaysia FBMKLCI Index 1,804 1,803 0.08% 3.37%Philippines PCOMP Index 6,041 6,192 2.43% 2.57%Vietnam VNINDEX Index 557 560 0.66% 10.28%Hong Kong HSI Index 22,035 22,450 1.85% 5.45%Singapore FSSTI Index 3,027 3,076 1.59% 4.43%Brazil IBX Index 19,318 19,605 1.46% 9.28%Russia RTSSTD Index 9,835 10,102 2.65% 3.36%India SENSEX Index 20,514 21,134 2.93% 3.10%China SHCOMP Index 2,033 2,054 1.04% 3.92%S&P SPX Index 1,794 1,790 0.22% 2.93%DJIA INDU Index 15,849 15,879 0.19% 4.39%NASDAQ Composite CCMP Index 4,123 4,128 0.12% 1.28%UK UKX Index 6,467 6,664 2.95% 4.18%German DAX Index 9,234 9,392 1.68% 3.33%Qatar DSM Index 11,156 11,338 1.61% 7.48%Abu Dhabi ADSMI Index 4,673 4,655 0.38% 8.92%Dubai DFMGI Index 3,770 3,819 1.27% 11.89%Kuwait KWSEIDX Index 7,756 7,779 0.29% 2.73%Oman MSM30 Index 7,087 7,201 1.57% 3.70%Saudi Arabia SASEIDX Index 8,761 8,772 0.13% 2.64%MSCI EM MXEF Index 936 950 1.42% 6.61%MSCI FM MXFM Index 603 613 1.71% 1.34%


5/10

5



Chart Bank

FIPI Flows for the week

(811)

(2,812)

3,813

(873)

2,969

(4,000)

(3,000)

(2,000)

(1,000)

1,000

2,000

3,000

4,000

5,000

27 Jan 28 Jan 29 Jan 30 Jan 31 Jan

(US$'000)

Advance to Decline Ratio

0.80

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AKD Universe vs. KSE-100 Index

3%2%7%

12%17%22%27%32%37%42%47%52%

Jan 13 May 13 Jul 13 Oct 13 Jan 14

KSEAll Share Index AKD Universe

LIPI Flows for the week

Others, (12.09)

Ind., 0.10

Co., (4.24)Bank/DFI,

(2.03)NBFC, 4.70

M.Funds,(11.11)

(18.00)

(14.50)

(11.00)

(7.50)

(4.00)

(0.50)

3.00

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10.00

13.50

(US$mn)

Earnings Yield vs. T-Bill (12M) Differential

(6.0)

(4.0)

(2.0)

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(%)

KSE-100 vs. MSCI-EM & MSCI-FM

15%5%5%

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KSE100MSCI EMMSCI FM


6/10

6

AKD Securities Limited StockSmartPakistan Weekly Update

AKD Universe Valuat ions

Market PER Chart 2014F

Source: AKD Research

Market P/BVS Chart 2014F



31 January 2014

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31 Jan14 2011A 2012A 2013A/E 2014F 2015FEPS (PkR) 8.30 9.18 9.99 11.99 13.87 EPS chg (%) 24.32 10.52 8.85 20.04 15.72 EPS chg (%) ExFinancials 25.20 10.97 15.75 23.55 16.97 Book Value per Share (PkR) 39.05 45.04 50.61 56.58 63.50 Payout (%) 53.13 50.27 51.91 51.08 49.01 ValuationsPrice to Earnings (x) 12.43 11.25 10.33 8.61 7.44 Price to Book (x) 2.64 2.29 2.04 1.82 1.63 PER (x) ExFinancials 13.38 12.06 10.42 8.43 7.21 P/BVS (x) ExFinancials 3.23 2.82 2.41 2.10 1.85 Price to CF (x) 20.06 21.25 10.64 18.78 11.56 Earnings Yield (%) 8.04 8.89 9.68 11.61 13.44 Dividend Yield (%) 4.27 4.47 5.02 5.93 6.59 EV / EBITDA (x) 7.73 6.84 6.01 5.23 4.62 ProfitabilityReturn on Equity (%) 21.26 20.38 19.73 21.19 21.85 Return on Assets (%) 3.79 3.59 3.79 4.02 4.22 Chg in Sales (%) 17.34 17.28 6.12 13.68 10.52 Gross Margin (%) 23.41 21.79 22.80 22.36 22.85 Operating Margin (%) 14.47 12.95 13.99 13.85 14.61 Net Margin (%) 11.20 10.55 10.83 11.43 11.97


7/10

7

AKD Securities Limited StockSmartPakistan Weekly Update

AKD Universe Active Coverage Clusters Valuations


31 January 2014

Stocks Symbol Price TP Stance EPS

(PkR) PE(x) PB (x)

DY (%)

(PkR) (PkR) 12A 13A/E 14F 12A 13A/E 14F 12A 13A/E 14F 12A 13A/E 14F

Automobile and Parts Indus Motors INDU 381.0 384.29 Neutral 54.7 42.7 49.06 7.0 8.9 7.8 1.8 1.7 1.5 8.4 6.6 6.3

Pak Suzuki Motors PSMC 164.5 173.46 Accumulate 11.9 24.3 21.71 13.8 6.8 7.6 0.9 0.8 0.7 1.5 3.0 2.4

Construc on and Materials

DG Khan Cement DGKC 95.7 105.47 Accumulate 9.4 12.6 12.14 10.2 7.6 7.9 1.3 0.9 0.8 1.6 3.1 3.1

Chemicals

Engro Polymer Chemicals EPCL 15.0 16.49 Accumulate 0.1 1.1 1.15 129.4 14.3 13.1 1.6 1.4 1.3

ICI Pakistan Limited ICI 321.1 228.39 Sell 9.7 9.3 17.82 33.2 34.4 18.0 2.9 2.8 2.6 1.7 1.6 2.8

Lo e Chemical Pakistan Ltd. LOTCHEM 7.3 8.53 Accumulate 0.00 (0.02) 0.59 n.m n.m 12.3 0.9 0.9 0.8 3.4

Engro Corpora on ENGRO 178.3 159.61 Reduce 2.6 18.7 18.24 68.4 9.5 9.8 2.1 1.2 1.2

Dawood Hercules Limited DAWH 67.6 71.83 Accumulate 2.0 9.2 13.07 33.1 7.3 5.2 1.7 n.a n.a 1.5

Fauji Fert. Bin Qasim Ltd. FFBL 42.4 49.33 Accumulate 4.6 6.4 6.63 9.1 6.7 6.4 3.1 2.5 2.5 10.6 13.0 14.7

Fauji Fer lizer Company FFC 113.4 138.62 Buy 16.4 16.9 16.41 6.9 6.7 6.9 6.6 6.0 5.8 13.7 14.1 14.3

Fa ma Fer lizer

FATIMA

28.3

35.09

Buy

2.9

4.1

5.02

9.7

7.0

5.6

2.1

1.8

1.5

7.1

7.1

7.1

Food Producers

Engro Foods Limited EFOODS 102.0 80.92 Sell 3.4 1.7 2.60 30.1 59.7 39.2 7.8 6.8 5.8

Oil & Gas

Oil & Gas Development Co. OGDC 272.5 265.50 Neutral 21.6 21.1 27.61 12.6 12.9 9.9 4.4 3.6 2.9 2.7 3.0 4.2

Pak Oil elds POL 529.8 612.57 Accumulate 50.1 45.8 59.12 10.6 11.6 9.0 3.6 3.6 3.3 9.9 8.5 8.7

Pakistan State Oil PSO 341.8 335.18 Neutral 36.7 50.8 76.82 9.3 6.7 4.4 1.7 1.4 1.1 1.6 1.5 2.9

Electricity

Hub Power Co. HUBC 64.6 77.41 Accumulate 7.1 8.1 9.62 9.1 8.0 6.7 2.4 2.2 2.2 9.3 12.4 13.9

Kot Addu Power Company KAPCO 64.0 63.00 Neutral 6.9 8.4 9.05 9.3 7.7 7.1 2.4 2.3 2.3 10.8 11.7 13.7

Fixed Line Telecommunica on

Pakistan Telecommunica on PTC 28.6 29.71 Neutral 2.2 3.1 4.20 12.8 9.3 6.8 1.2 1.2 1.1 7.9 10.5

Personal Goods

Nishat Mills NML 134.5 141.38 Accumulate 10.0 16.6 19.03 13.4 8.1 7.1 1.3 0.8 0.7 2.6 3.0 3.7

Nishat Chunian Ltd. NCL 63.8 61.61 Neutral 3.5 11.4 14.82 18.3 5.6 4.3 2.1 1.6 1.2 2.6 2.8 7.1 Banks

Allied Bank Limited ABL 89.0 95.03 Accumulate 11.4 10.7 11.00 7.8 8.3 8.1 1.8 1.6 1.4 6.6 6.2 6.7

Bank AlFalah BAFL 27.6 26.95* Accumulate 3.4 3.3 3.79 8.2 8.33 7.3 1.2 1.22 1.1 7.2 5.4 6.3

Habib Bank Limited HBL 165.4 154.97 Reduce 16.7 16.3 18.19 9.9 10.2 9.1 1.7 1.6 1.5 4.1 5.1 5.7

MCB Bank Limited MCB 283.8 255.00 Reduce 20.9 22.2 22.36 13.6 12.8 12.7 2.7 2.5 2.3 4.2 4.9 5.3

Na onal Bank of Pakistan NBP 58.4 62.50 Accumulate 7.9 5.7 8.01 7.4 10.33 7.28 0.8 0.8 0.74 10.4 7.7 9.4

United Bank Ltd UBL 134.0 145.00 Accumulate 15.7 15.0 15.93 8.5 8.9 8.4 1.6 1.6 1.4 6.3 6.3 6.7

* TP for BAFL rises to PkR30/share upon successful Warid stake sale


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8



AKD Universe Coverage Clusters PerformanceStock s Sym bol Pr ice 1 Year 1 Year

31-Jan-14 1M 3M 6M 12M CYTD High Low

KSE-100 Index 26784.34 6.0 17.6 14.9 55.3 6.0 27104.70 17492.00

Industrial Engineer ing

Al-Ghazi Tractor AGTL 204.01 -4.0 3.3 -9.1 -12.0 -4.0 235.93 197.00Millat Tractors MTL 462.85 -4.1 2.4 -4.4 -10.2 -4.1 519.58 433.73

Au to m ob ile an d Par ts

Indus Motors INDU 381.00 14.4 19.1 10.6 36.1 14.4 398.10 282.00Pak Suzuki Motors PSMC 164.45 6.9 32.7 8.4 74.8 6.9 167.70 97.29

Construction and Materials

DG Khan Cement DGKC 95.69 11.6 33.7 4.4 73.2 11.6 95.63 57.89Lucky Cement LUCK 309.75 3.3 23.0 28.0 96.7 3.3 321.67 160.97

Chemicals

Engro Polymer Chemicals EPCL 15.02 12.0 19.8 9.6 52.2 12.0 16.66 9.29ICI Pakistan Limited ICI 321.12 26.9 91.9 91.4 106.6 26.9 298.25 135.37Lotte Pakistan PTA Limited LOTCHEM 7.27 -1.0 6.9 -4.7 -2.5 -1.0 8.89 6.46Daw ood Hercules DAWH 67.60 20.5 34.2 22.9 102.7 20.5 69.01 35.76Engro Chemical ENGRO 178.26 12.6 40.7 10.3 89.4 12.6 186.91 94.44Fatima Fertilizer FATIMA 28.33 -0.8 9.7 12.6 9.3 -0.8 30.16 21.29Fauji Fert. Bin Qasim Ltd. FFBL 42.43 -3.1 11.2 2.7 10.9 -3.1 45.42 36.90Fauji Fertilizer Company FFC 113.44 1.3 4.8 4.2 -4.3 1.3 119.75 101.90

Food Produ cers

Engro Foods Limited EFOODS 102.01 -2.3 19.5 -26.7 -4.0 -2.3 162.22 80.37

Non Life Ins ur ance

Adamjee Insurance AICL 39.58 5.9 53.9 28.1 62.8 5.9 40.37 23.57

Oil & Gas

Oil & Gas Development Co. OGDC 272.54 -1.4 1.0 10.8 40.5 -1.4 287.84 197.32Pak Oilf ields POL 529.78 6.4 10.8 1.7 17.2 6.4 531.92 435.37Pakistan State Oil PSO 341.83 2.9 24.1 -6.1 78.2 2.9 367.10 184.67

Electricity

Hub Pow er Co. HUBC 64.57 6.3 3.2 -4.7 33.2 6.3 73.42 50.13Kot Addu Pow er Company KAPCO 64.00 3.6 6.7 6.8 18.5 3.6 68.34 49.53

Fixed Line Telecomm unication

Pakistan Telecommunication PTC 28.63 0.7 7.3 1.8 53.8 0.7 31.70 17.46

Personal Goods

Nisaht (Chunian) Ltd. NCL 63.80 6.0 25.5 -0.7 70.6 6.0 68.82 43.31Nishat Mills NML 134.52 5.7 45.4 28.4 109.8 5.7 140.79 67.46

Banks

Allied Bank Limited ABL 89.00 -1.1 4.7 14.1 32.3 -1.1 94.51 55.01 Askari Bank Limited AKBL 14.04 0.3 29.0 7.1 -8.5 0.3 16.15 10.76Bank AlFalah BAFL 27.64 2.2 21.8 30.7 49.5 2.2 28.66 14.77Habib Bank Limited HBL 165.36 -0.8 11.9 -3.0 53.3 -0.8 181.57 88.00Habib Metropolitan Bank HMB 25.49 1.7 13.7 36.4 39.4 1.7 26.16 14.61MCB Bank Limited MCB 283.81 0.9 0.9 4.2 46.7 0.9 316.87 183.00Meezan Bank Limited MEBL 38.00 -3.5 0.6 5.8 45.7 -3.5 40.87 24.11National Bank of Pakistan NBP 58.38 0.6 18.3 0.1 29.1 0.6 59.45 37.66United Bank Ltd UBL 133.99 1.1 8.8 10.1 48.0 1.1 154.21 82.16

Ab s ol ut e Per fo rm ance (%)



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9



Economic Snapshot

Source: SBP, PBS & AKD Research

End Month Data Unit s Feb-13 Mar-13 Apr -13 May-13 Jun -13 Jul -13 Aug -13 Sep-13 Oct-13 Nov-13 Dec-13

T-bill

3M % 9.20 9.37 9.42 9.41 9.26 8.93 9.00 9.15 9.47 9.63 9.93

6M % 9.32 9.46 9.44 9.42 9.16 9.01 9.20 9.35 9.68 9.88 10.02

12M % 9.37 9.47 9.46 9.43 9.19 9.03 9.34 9.48 9.81 9.96 10.12

PIB 10Y % 11.99 12.00 11.92 11.25 10.86 11.57 11.97 12.28 12.83 12.93 12.90

KIBOR 6M % 9.43 9.54 9.58 9.60 9.39 9.08 9.15 9.29 9.55 9.52 10.13

Discount rate % 9.50 9.50 9.50 9.50 9.00 9.00 9.00 9.50 9.50 10.00 10.00

Inflation

Headline inflation % 7.40 6.60 5.80 5.10 5.90 8.26 8.55 7.40 9.10 10.90 9.18

Core inflation % 9.6 9.00 8.70 8.10 7.80 8.20 8.50 8.70 8.40 8.50 8.20

Food inflation % 7.4 6.30 5.50 6.50 7.90 9.20 10.30 7.90 9.80 13.00 9.30

External Indicators

Export (PBS) US$ (mn) 1,835 2,134 2,130 2,175 2,197 2,095 1,996 2,622 1,864 1,804 2,275

Import (PBS) US$ (mn) 3,383 3,687 3,909 4,346 3,940 3,814 3,572 3,791 3,281 3,651 3,561

Trade Deficit (PBS) US$ (mn) (1,548) (1,553) (1,779) (2,171) (1,743) (1,719) (1,576) (1,169) (1,417) (1,847) (1,286)

Home Remittances US$ (mn) 1,028 1,119 1,216 1,186 1,165 1,404 1,233 1,283 1,348 1,131 1,385

Current Account US$ (mn) (596) (513) (354) (346) (163) 46 (575) (574) (166) (572) 285

Banking SectorDeposits PkR (bn) 6,645 6,777 6,709 6,950 7,316 7,069 7,174 7,125 7,133 7,309.45 7,529.37

Advances PkR (bn) 3,868 3,873 3,857 3,906 3,869 3,788 3,817 3,831 3,921 4,008.03 4,071.47

Investments PkR (bn) 3,909 4,024 3,893 3,942 4,129 3,837 3,708 3,873 3,776 4,035.48 4,069.80

Weighted avg lending rate % 11.52 11.50 11.42 11.49 11.36 11.28 11.11 11.10 11.10 11.13 11.07

Weighted avg deposit rate % 5.34 5.26 5.23 5.15 5.01 4.97 4.83 4.79 4.90 4.89 5.05

Spread rate % 6.18 6.24 6.19 6.34 6.35 6.31 6.28 6.31 6.20 6.24 6.02

Public Finance

Tax collection PkR (mn) 140,264 190,357 153,199 173,268 267,608 n.a n.a n.a n.a n.a n.a

Direct taxes PkR (mn) 48,743 78,649 48,462 60,982 128,889 n.a n.a n.a n.a n.a n.a

Indirect Taxes PkR (mn) 91,521 111,708 104,737 112,286 138,719 n.a n.a n.a n.a n.a n.a

Currency

Reserves (RHS) US$ (mn) 12,936 12,250 11,812 11,474 11,020 10,287 9,998 9,995 9,525 8,238 8,168

USDPkR - Interbank PkR/USD 98.16 98.42 98.48 98.52 98.94 101.90 104.51 105.24 106.89 107.56 107.13


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stock smart weekly (jan 31 2014)

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