AKBL - Askari Bank Limited17-Jul-14AKBL - turnaround expected
AKBL to present healthy balance sheet this year as majority of nonperforming loans were written off.
Operating under giant business group strong credit demand is expected for AKBL.
Bank to record lower provisioning cost this year
Boost in non- core income is expected as textile exports to grow
Investment in higher yield PIBs stretching the banking spread ~ 6.11%
Good payout expected in AKBL
Rajesh Kumar Maheshwari
Research Analyst
+922135290267
Rajesh Kumar Maheshwari
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CSAP - Crescent Steel and Allied Proudcts Ltd.26-Jun-14We re-initiate our coverage with a positive stance for CSAP given triggers in steel segment and revitalizing yarn. We have assumed 4Q sales to improve in both steel & cotton yarn. The 4Q EPS could be Rs 2.2/share-Rs 2.6/share. We see overall EPS could be Rs 7.09-8.00 thus spelling FY14 PE of 6.4x.
Ali Sufyan (ACCA) Affiliate
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KSE 100 Index26-Jun-14Cement manufacturers using a mix of gas, RDF, Solid waste and coal to fulfil the energy needs for the production of cement. The imposition of duty on imported coal will not deteriorate the profits of the industry as the higher demand already put manufacturers in the position where they can dictate the cement prices
Federal government and Provincial government may jointly allocate more than Rs 1 trillion for PSDP in FY15 which will lead to higher cement demand which could be 35mn tons
GoP has inaugurated the Dasu Dam project and now working aggressively to obtain finance on Basha Dam project
Saad Hashmi
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KSE All Index25-Jun-14Banking sector to outperform.
With growth in economy the banking sector is also in limelight given 1) Improving banking spread 2) Increasing credit demand 3) Shift in portfolio investment 4) Low chances of decrease in DR. We believe that middle tier banks will be major beneficiary. BAFL, BAHL, FABL, HMB and AKBL are preferred pick.
Rajesh Kumar Maheshwari
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KSE 100 Index24-Jun-14We are bullish about market, as political uncertainly has somehow nullify. Investors are getting confidence in the market. BUY PAEL, FCCL, PSO
Rajesh Kumar Maheshwari
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PPL - Pak Petroleum Ltd.23-Jun-14Get ready for opportunity!! Subscribe for PPL book building
Bidding dates June 26, to June 27, 2014
9AM to 5PM
Offer: 70,055,000shares
3.55% of paid up
Floor price yet to determine
Rajesh Kumar Maheshwari
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KSE 100 Index19-Jun-14Chaos in the market. The speculators are off-loading their holdings. We believe one must HOLD script with June end dividend yield.
Rajesh Kumar Maheshwari
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THALL - Thal Limited.17-Jun-14THALL back in saddle. We recommend Buy THALL @ Rs. 193. Dividend income from Makro & Metro to reach Rs 498 mn in FY14. THAL Boshoku a joint venture will start generating revenues in FY15 which will augment the cashflows of THALL. Induction of new products in Building & Allied products line will enhance the revenues in coming years as well Expo 2020 Dubai has also opened export opportunities for THALL. THALL has also 6.2% holding in INDUS motors.
Saad Hashmi
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CHCC - Cherat Cement Company Limited16-Jun-14CHCC is performing well and aggrandizing sales in FY14 and FY15 and efficient production process resulting lower production cost and lower debts resulting lower finance cost which will result higher net profits in FY15 and FY16 therefore, we are maintaining “BUY” call with Target price of Rs. 92 and EPS of Rs. 11.91/sh and Rs. 12.01/sh in FY14 & FY15 respectively.
Saad Hashmi
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MLCF - Maple Leaf Cement16-Jun-14We maintain BUY: We maintain our coverage on MLCF as one of the efficient cement manufacturer in Pakistan, with a BUY rating and a potential target price of Rs. 40 with attractive PE of 4.8x and 4.3x in FY14 and FY15.
Saad Hashmi
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PSMC - Pak Suzuki Motor Co. Ltd. 16-Jun-14Currently PSMC yields lowest expected PE of 8.3x in the industry which is still attractive to take long position in it.
We recommend BUY PSMC
Rajesh Kumar Maheshwari
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ASL - Aisha Steel16-Jun-14As per our expectations~ FBR imposes 10% import duty on Silicon Steel which was previously zero percent, Hence we see positive impact on ASL and ISL as they are the only two market leader in production of Cold rolled coils (CRC)
Ali Sufyan (ACCA affiliate)
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LOTCHEM - Lotte Chemical Pakistan16-Jun-14LOTCHEM ~ PTA-Px margins to be in favour of LOTCHEM. We re-initiate our covergae on LOTCHEM with a target price of Rs 8.5/ share with an EPS of Rs 0.84 in CY14 and Rs 0.91 in CY15.
Ali Sufyan (ACCA affiliate)
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PAEL - Pak Elektron Ltd. 20-May-14Pak Elektron Ltd is catching attention
The seasonal sales of company are expected to increase.
Summer seasonal sale of appliances will boost the company’s topline with massive growth rate.
Along with this we see an enhancement in profitability in CY14 due to swelling margins.
PAEL is yielding lowest expected PE of 4x
We recommend BUY
Rajesh Kumar Maheshwari
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HCAR - Honda Atlas Cars (Pakistan) Ltd.16-May-14HCAR yields expected PE of 8x along with dividend yield of 4%, given expected topline growth due to volumetric sales and bottom line due to swelling margins. While PSMC and INDU yield expected PE of 7.3x and 10.3x respectively.
We maintain HOLD stance for HCAR.
Rajesh Kumar Maheshwari
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DGKC - D. G. Khan Cement Co. Limited 08-May-14We have fine tuned our model of DG Khan Cement (DGKC). We have lowered down our expected FY14 EPS to Rs. 12.71 from Rs. 14.41 which we reported earlier on March 3, 2014.
We have lowered down fair value of DGKC to Rs101 ¬ which is at a discount of 17%. We maintain BUY.
Saad Hashmi
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FCCL - Fauji Cement Company Ltd.07-May-14May 7,2014
Just in:
Domestic Cement sales during Apr rose 7.2%YoY to 2.539mn tons. Cement sales touched an all-time high of 3.21 million tons in April.
FCCL, PIOC and MLCF are in limelight in cement sector
Rajesh Kumar Maheshwari
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AICL - Adamjee Insurance Co. Ltd. 05-May-14AICL has increased its market share in UAE resulting increase in premium revenue.
AICL outperform in local and UAE operations deciphering 22% and 5% increase in premium revenue.
Valuation – PE 6.7x is attractive among peer
AICL has attractive PE of 6.7x among big non life insurers.
We maintain BUY ~ AICL deciphers PE of 6.7x & PBV of 0.67x.
Saad Hashmi
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MLCF - Maple Leaf Cement05-May-14MLCF has re-engineered their debts FY14 3Q depicted a strong Q-o-Q decrease in finance cost by 31% and Y-o-Y decrease by 15%. We are expecting the same for the last quarter FY14.
We are expecting increase GP margin of 34% due to decrease in coal prices $72/ton and NP margin of 18% due to decrease in finance cost in 4Q FY14.
Valuation – PE 4.8x is cheapest among peers
We maintain our FY14 EPS outlook of Rs 6.65/sh ~ FY14 PE 4.8x is cheapest among big cement manufacturers.
We Therefore we maintain our “BUY CALL” for MLCF
Saad Hashmi
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KSE All Index25-Feb-14HASCOL IPO: On the floor price of Rs 20 during book building process HPL yield PE of 4.6x based on diluted EPS of Rs 4.32/sh reported in CY13 .Which is best PE multiple to subscribe for an IPO especially for an OMC. SUBSCRIBE
Rajesh Kumar Maheshwari
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OGDC - Oil & Gas Dev.Co25-Feb-14OGDC remains our pick with PE of 8.4x. The company has a growing hydrocarbon production status with production increase coming from development wells. The company has shown encouraging 1HFY14 EPS of Rs 15.63. Buy maintained
Faisal Shaji
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FCCL - Fauji Cement Company Ltd.24-Feb-14FCCL is one of the efficient cement players given cost efficiency and strong local cement demand. It has showed a tremendous 1HFY14 performance with an interim dividend of Re 0.75/sh. We expect FCCL to post EPS of Re 2.33/sh in FY14, and a cash dividend of Rs 1.75/sh. Fauji Cement spells dividend yield of 11%-12%, which is equivalent to FFC. Buy
Nabeel Khursheed
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HMB - Habib Metropolitan Bank Limited11-Nov-13We see HMB attractive based on higher dividend yield of 8.8% among other peer banks like BAHL, BAFL and ABL have dividend yield of 6.9, 7.9 and 7.3 respectively. And also HMB’s 48.8% ADR ratio is also stronger than the other peer banks.
We expect HMB to report EPS of Rs 3.40- 3.50 for CY13 along with final cash dividend of Rs 2/sh. HMB yield lower PE of 6.9x whereas BAHL, BAFL and ABL yields PE of 8.0x, 7.5x, 7.9x respectively, and higher dividend yield of 8.8%. BUY
Rajesh Kumar Maheshwari
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HMB - Habib Metropolitan Bank Limited07-Nov-13In the wake of new MPS we see spike in interest earned of commercial banks. HMB would be one beneficiary which is spelling PE of 6x to 7x. HMB can also pass on Rs 2 per share dividend. BUY HMB
Rajesh Kumar Maheshwari
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OGDC - Oil & Gas Dev.Co07-Nov-13OGDC is one company which is dynamic in terms of asset acreage and if things pick tempo at Kohlu which has recoverable reserves of 15TCF then fortunes could be realized in next 20years.
We like OGDC vide our last week call (could be retrieved from www.scstrade.com research portal). Maintain BUY in OGDC
Faisal Shaji
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FFC - Fauji Fertilizer Company Limited.31-Oct-13We believe investors should focus on earnings spree of FFC and should not be bothered by the fact that FFC couldn’t pass on any increase in gas prices to end-users due to the fact that international urea prices are similar to local prices. We believe urea manufacturers in general and FFC in particular are well entrenched in terms of already huge margins and should sustain gas price increase. BUY FFC
Faisal Shaji
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LUCK - Lucky Cement Limited 30-Oct-13LUCK could still match FY13 performance while notching year EPS of Rs 30/sh despite lower government spending in current fiscal that could hurt local cement sector dispatches. But LUCK cement dispatches is reporting yearly growth of 3.5 times due to its economy of scale and leader like status. LUCK spells FY14 PE of 7x albeit EVEBITDA of 7.8x & lessened dividend yield of 3% (since LUCK has always been a value investment since the payout ratio doesn’t exceed more than 30%). BUY LUCK
Faisal Shaji
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NATF - National Foods Limited. 24-Oct-13National Foods: Growing overseas sales stretch GP margin ...BUY maintained...
NATF reported 1QFY14 EPS of Rs 5.25/sh, against Rs.4.83/sh is same period last year.
we see sales will further increase in coming days and we expect NATF may report year end earning in the range of Rs 23- 25 for FY14, and yields leading PE of 13.5x and historical PE of 22x. We maintain BUY.
Rajesh Kumar Maheshwari
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POL - Pakistan Oilfields Ltd. 22-Oct-13POL profits jump by Rupee depreciation; full year earnings could get a boost. Pakistan Oilfields (POL) is now a great beneficiary of depreciating Rupee. The gross revenue notched Rs 9.4bn owing to higher realizable prices despite the fact that there is no significant jump in the overall production numbers of crude.
The dividend of POL could exceed Rs 55 – 60/share translating into annual dividend yield of 13% (a jump from 10%). Last year, POL passed on dividend of Rs 45/share.
It seems that POL could report handsome interim cash dividend of Rs 27 – 30/share
Faisal Shaji
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PSMC - Pak Suzuki Motor Co. Ltd. 21-Oct-13Auto industry is one of emerging industries in Pakistan; with three major players PSMC leads the industry in terms of sales.
Based on expected earnings PSMC and HCAR yield PE multiple of 4.5x each, which makes BUY stance for both companies and INDU yields 7.5x and we maintain SELL.
Rajesh Kumar Maheshwari
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NBP - National Bank Of Pakistan Ltd07-Oct-13NBP is deciphering PBV of 0.71x & PE of 8x and relatively underpriced at a time when interest rates shall increase. Despite SBP rulings over MDR of 6.5pc, we see NBP NIMs to remain intact at above 5pc. We see target earnings of Rs 6 per share in CY13 & PBV target price of Rs56 per share. Buy
Rajesh Kumar Maheshwari
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NCPL - Nishat Chunian Power07-Oct-13Nishat Chunian Power is on spot. It has given a dividend of Rs 2 before the announcement of FY13 results. Now NCPL announced Rs7.45 EPS with final dividend of Rs2. The cumulative dividend comes to Rs6 which translates into a dividend yield of 16%. Now we see further growth in earnings in FY14 with company has already got its share of receivables from GoP. NCPL deciphers PE of 4.5x. Buy
Faisal Shaji
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TGL - Tariq Glass Limited04-Oct-13The company installed new Float Glass Plant with capacity of 550 tons per day during 3rd quarter of FY13. We have estimated TGL shall report Rs 3.30/sh EPS during outgoing fiscal and Rs 4.80/sh EPS in FY14 given increase in float glass sales. TGL offers FY14 PE multiple of 5x which is awesome. The company is a continuous development story and hence we advise Long term BUY
Rajesh Kumar Maheshwari
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BAHL - Bank AL-Habib Limited 18-Jul-13At the aftermath of increase in benchmark rates some second tier banks like BAHL looks good. BAHL yields PE of 5x to 6x.
Faisal Shaji (Head of Research)
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FFBL - Fauji Fertilizer Bin Qasim17-Jul-13Fauji Fertilizer Bin Qasim Limited (FFBL) earnings are expected to flourish ahead and good earnings are expected to be reported at the year end on the basis that the margins on DAP are increasing due to decrease in the phosphore prices internationally which is a major raw material of DAP. We expect earnings of Rs4.8-5.00/sh to be reported at the year end with the DCF target price of Rs53/sh. We signal BUY for FFBL.
Saud Khan Research Analyst
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