Fertilizer: Rabi season to ease inventory levels – By AKD Research

Nov 19 2024


AKD Securities


  • Urea offtakes declined due to deteriorating farmer incomes. On the contrary, DAP sales surged by 95%YoY, driven by the onset of the Rabi season.
  • FFC’s urea sales dropped by 12%YoY in Aug’24. While, EFERT urea offtakes experienced a 42%YoY drop, due to price disparity.
  • Companies on the Mari gas network i.e., FFC and FATIMA (base plant), continue to benefit from 53%YoY lower gas prices.

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Technical Outlook: KSE-100; Recovery to continue – By JS Research

Dec 23 2024


JS Global Capital


  • The KSE-100 index after making a low of 105,601 recovered during the day, closing in at 109,513 level, up 3,238 points DoD. Volumes stood at 755mn shares versus 1,167mn shares traded previously. The index is expected to re-test resistance at 109,847 (Friday's high) where a break above that will target 111,320, followed by 114,591. However, any downside will find support between 106,800 and 108,320 levels where a fall below that will target 105,601 level. We recommend investors to view any downside as an opportunity to 'Buy', with risk defined below 105,601. The support and resistance levels currently stand at 106,793 and 111,040, respectively.

Morning News: Pakistan, China capital markets to deepen ties – By Vector Research

Dec 23 2024


Vector Securities


  • A high-level delegation from Pakistan's capital markets, led by Securities and Exchange Commission of Pakistan (SECP) Chairman Akif Saeed, visited China recently. During the one-week visit, the delegation engaged with key Chinese financial institutions, including the China Securities Regulatory Commission, China Securities Depository and Clearing Corporation and others.
  • Chinese company ADM Group has unveiled a major investment of $350 million in Pakistan, with backing from the Special Investment Facilitation Council (SIFC). As part of the initiative, ADM Group plans to establish more than 3,000 electric vehicle (EV) charging stations across the country. The project will see 1,000 stations set up in Sindh, 1,500 in Punjab, and 750 in Khyber Pakhtunkhwa and Balochistan.
  • The Punjab government is seeking a loan of $210 million from the Asian Development Bank (ADB) for developing resilient environments and advancing municipal services in the province.

Morning News: Pakistan, China capital markets to deepen ties – By Darson Research

Dec 23 2024


Darson Securities


  • A high-level delegation from Pakistan's capital markets, led by Securities and Exchange Commission of Pakistan (SECP) Chairman Akif Saeed, visited China recently. During the one week visit, the delegation engaged with key Chinese financial institutions, including the China Securities Regulatory Commission, China Securities Depository and Clearing Corporation and others
  • Chinese company ADM Group has unveiled a major investment of $350 million in Pakistan, with backing from the Special Investment Facilitation Council (SIFC). As part of the initiative, ADM Group plans to establish more than 3,000 electric vehicle (EV) charging stations across the country. The project will see 1,000 stations set up in Sindh, 1,500 in Punjab, and 750 in Khyber Pakhtunkhwa and Balochistan.
  • The Punjab government is seeking a loan of $210 million from the Asian Development Bank (ADB) for developing resilient environments and advancing municipal services in the province.

Annual Strategy: Market Strategy 2025 Inflation likely to remain in single digits for most of CY2025 – By Chase Research

Dec 20 2024



  • Inflation expected to remain in single digits for most of CY2025.
  • Central Bank to continue easing. We consider single digit interest rates a high possibility in 2025.
  • Current Account should not present a challenge as improved remittances, recovering exports and administrative measures to keep balance in check.
  • Pakistan Credit Ratings could improve in 2025 unlocking flows and strengthening PKR.

Tri-Pack Films Limited (TRIPF): 9MCY24 Corporate Briefing Takeaways – By Taurus Research

Dec 20 2024


Taurus Securities


  • Tri-Pack Films Limited (TRIPF) is a subsidiary of Packages Limited which holds 69.3% of the Company. TRIPF produces Biaxially Oriented and Cast Polypropylene (BOPP & CPP) packaging films for food and beverage applications such as snacks, confectionery, dairy food, fresh cut vegetables, beverages etc., and non-food applications such as overwrapping, lamination, bag making etc. TRIPF has annual capacities of 78,000 tons for BOPP, 14,400 tons for CPP, and 32,600 tons for Metallizers.
  • TRIPF boasts a product portfolio of 19 specialized films, these include: Low Sealing Temperature Film, Ultra Low Temperature Sealable Film, Tobacco Non-Coated Transparent Wrap, Anti-Fog Films, Perforated Film, Matt Film, In Mould Labels, Low Density Label Film, High Gloss Label Film, Broad Seal High Barrier, Ultra High Barrier Metallized Film, Heat Resistive BOPP Film, Cold Seal, BOPE, BOPP Super Barrier Film, CPP High Speed Lamination Film, Paper Bond Film, CPP Metallized Low Temperature Heat Sealable Film, and CPP Metallized High Barrier Film.
  • As of 9MCY24, TRIPF’s revenue increased to PKR 21.8Bn compared to PKR 18.5Bn during the SPLY. Gross margin was recorded at 13% compared to 18% during the SPLY. The loss for the period was recorded at PKR 291Mn compared to a net profit of PKR 830Mn in the SPLY. The main reason cited for the loss during the year by the management was finance costs. Finance costs during 9MCY24 were recorded at PKR 1.7Bn compared to only PKR 700Mn in the SPLY. In addition to these, the gas tariff also increased by 110%.

Annual Strategy: Pakistan Market Strategy 2025 Breaking Barriers: KSE-100 Marches Toward 148K – By Sherman Research

Dec 20 2024


Sherman Securities


  • Pakistan’s KSE 100 index is all set to generate total return of 40%, breaching 148k level during CY25. Market is expected to reach target PE of 8x in line with last 10-year average PE versus current PE of 6.1x. Target PE of 8x is justified considering Pakistan’s economic outlook as most of the indicators are in line with average of last 10 years.
  • After meeting all the key performance indicators specially during last 2 years (maintaining primary budget surplus, tight monetary policy, energy sector reforms and regulating FX market), Pakistan is now looking at raising tax to GDP which is expected to be key performance criterion for timely disbursement under new IMF Program of US$7bn.
  • With inflation to remain below historical average and lower risk to external accounts during IMF Program, we expect policy rate to remain around 10% during next 2 years. Considering ample institutional liquidity, we expect diversion of Rs1.2-1.5trn funds (40% of the free float of KSE-100 Index) during CY25 from fixed income to equity market. Not only this, stable currency and cheap valuations will induce Foreigners’ interest in Pakistan market as they have been net sellers so far.

Economy: Recent PSX rally led by local funds buying Thanks to the falling return on fixed income instruments – By Topline Research

Dec 20 2024


Topline Securities


  • Pakistan Market since Sep 2024 to-date has returned 35% in both Rs and US$ terms, thanks to the strong net inflows of Rs58bn (US$207mn) of local mutual funds during the same period mainly due to conversion from fixed income to equities. In this note, we have tried to gauge the expected quantum of further liquidity market can receive due to conversion from fixed income to equities.
  • The funds/investors are converting from Fixed income to equities as yields on fixed income instruments have fallen by 1253bps-1261bps from peak of 24.73% and 24.51% on 12M and 6M Treasury Bills in Sep 2023 to 12.20% and 11.9% on Dec 19, 2024.
  • Equities will remain the preferred choice for investors: Unlike previous years where investors use to buy dollars, real estate, gold, prize bonds etc. for earning higher returns, we believe, in this cycle equities will get some portion of liquidity due to (1) higher restrictions on purchase of dollars, (2) increase in taxations, compliance and FBR valuation rates of properties, and (3) discontinuation of high denomination unregistered prize bonds.

Textiles: Increased imports vital for export growth – By JS Research

Dec 20 2024


JS Global Capital


  • The United States Department of Agriculture (USDA) has raised cotton demand forecasts for India, Pakistan, and Vietnam, likely offsetting the projected decline in Chinese demand as Western importers continue diversifying their sourcing away from China and Bangladesh. Consequently, Pakistan's prospects for value-added exports, such as knitwear and ready-made garments, have improved, albeit at the expense of lower yarn exports to China.
  • During 5MFY25, exports of knitwear, bedwear, and garments are up ~20% YoY while yarn exports are down 39%. On the other hand, Pakistan’s domestic cotton output is expected to fall to around 6-8mn bales (-36% to -17% YoY) due to 17% decline in cotton sowing area and lower crop yields.
  • To meet the cotton requirement for the export demand, Pakistan is expected to import 5mn bales of raw cotton, costing ~US$2bn (at current avg import prices) compared to merely 1.2mn bales or US$0.45bn in FY24.

Morning News: Pakistan’s exports rise 9.06% in five months, imports edge up 1.06%: PBS – By WE Research

Dec 20 2024



  • Exports from Pakistan increased by 9.06% in the first five months of FY2024-25, reaching Rs. 3,816,094 million, compared to Rs. 3,499,216 million in the same period last year. In November 2024, exports rose 7.17% year-on-year to Rs. 787,152 million. Key export commodities included knitwear, rice, readymade garments, and bedwear. Imports during July–November FY2024-25 totaled Rs. 6,248,611 million, a 1.06% increase from the previous year. November imports declined by 1.03% to Rs. 1,255,209 million. Key imports included petroleum products, LNG, palm oil, plastic materials, and mobile phones. Month-on-month, both exports and imports showed modest changes.
  • Pakistan and China agreed to build an expressway linking Gwadar Port with the new Gwadar International Airport and initiate feasibility studies for new motorways, including the Mirpur-Muzaffarabad and Karachi-Hyderabad routes, under the China-Pakistan Economic Corridor (CPEC). The agreement was made during a meeting between Pakistan’s Federal Minister Ahsan Iqbal and China’s Vice Minister of Transport Li Ying in Beijing. Iqbal emphasized expediting major projects, including the KarachiHyderabad Section and ML-1 railway upgrade. He also proposed the Mashkhel-Panjgur Highway in Balochistan. Iqbal later met the President of the Export-Import Bank of China to discuss economic recovery and space projects. Both sides reaffirmed their commitment to strengthening the CPEC partnership for sustainable development and prosperity.

Technical Outlook: KSE-100; Testing the support range – By JS Research

Dec 20 2024


JS Global Capital


  • The KSE-100 index witnessed another negative session, closing at 106,275, down 4,795 points DoD. Volumes stood at 1,167mn shares compared to 1,112mn shares traded in the previous session. The index is expected to test support at 105,937; a fall below this level will extend the decline towards 105,510, followed by 103,048. However, any upside will face resistance in the range of 107,980-110,040 levels. The Stochastic Oscillator and the RSI are heading down, supporting a corrective view. We recommend investors to stay cautious on the higher side and wait for dips. The support and resistance levels currently stand at 104,226 and 110,034, respectively.

Oil and Gas Development Company Ltd (OGDC): Discovery of Bettani-2 in Wali Block – By AKD Research

Dec 13 2024


AKD Securities


  • Oil and Gas Development Company Ltd (OGDC), the operator of Wali Block, has discovered a second well i.e. Bettani-2, having a flow rate of 2.1mmcfd/74bpd of gas and oil, respectively. To note, Bettani-1 well is presently yielding 14.6mmcfd/978bpd of gas and oil as per Oct’24 data, and has been in production since Jun’23. Additionally, a third well Bettani Deep-1 is under drilling as well. In summary, the following discovery is expected to contribute an annualized EPS impact of PkR0.16/sh for OGDC.

Pakistan Auto: Auto sales revving up; industry sales up 37%YoY – By AKD Research

Dec 11 2024


AKD Securities


  • In Nov’24, the auto sector witnessed an increase in volumes, up 37%YoY, with total industry sales reaching 13,856 units. The incline in sales was largely attributable to a 62% YoY increase in passenger cars sales. However, tractor sales still witnessed a marginal decline of 2%YoY.
  • Segment-wise, passenger cars with engine capacities of 1000cc & above emerged as the top-performing segment, clocking in at 3,930 units (up 93%YoY). Meanwhile, sales of 800- 1000cc reported at 381 units (down 48%YoY), primarily attributable to subdued Suzuki Cultus sales.
  • Amongst the major OEMs, INDU/HCAR posted growth of 129%/10%YoY, respectively.

Unity Foods Limited (UNITY): UNITY Eyes Global Biofuel Market with Edible Oil Residue Exports – By AKD Research

Dec 9 2024


AKD Securities


  • Unity Foods Limited (UNITY) has entered into advanced stages of negotiation for long-term off-take agreements to export sustainable biofuel feedstock (SAF), primarily targeting global producers of biofuel in Europe
  • Company has obtained the ISCC – EU certification to support the initiative and has already dispatched sample shipments to potential off-takers. Initial feedback from these customers has been positive, paving the way for potential deal finalizations as per the material notice.
  • The ISCC certification and subsequent execution of long term export contracts are expected to strengthen UNITY’s revenue base, marking a step towards dollarized revenue growth.

Pakistan Petroleum Limited (PPL): Discovery of second formation in Pateji X-1 – By AKD Research

Nov 29 2024


AKD Securities


  • Pakistan Petroleum Limited (PPL), as operator of the Shah Bandar Block in District Sujawal, Sindh, has announced a second formation discovery at the Pateji X-1 well. The discovery is expected to yield flows of 12.4mmcfd/198bpd, taking cumulative flows from the well to 24mmcfd/400 of gas and oil, respectively.
  • PPL and MARI hold post-commerciality stakes of 63% and 32%, respectively, with estimated annualized EPS contribution of PkR0.70 for PPL and PkR0.81 for MARI.

Nishat Chunian Limited (NCL): FY24 Analyst Briefing takeaways – By AKD Research

Nov 28 2024


AKD Securities


  • Nishat Chunian Limited (NCL) held its corporate briefing session today to discuss FY24 financial results and provide insights on the future outlook. Key takeaways from the call are as follows:
  • Company recorded a revenue of PkR88.8bn in FY24, reflecting a 24%YoY led by higher sales in the spinning and weaving divisions. Total sales of the weaving and spinning divisions amounted to PkR11.4bn/55.1bn, respectively, marking an increase of 33%/32.7%YoY.
  • Domestic sales accounted for the majority of the revenue, contributing 69% of the total revenue in the weaving division and 71% in the spinning division during FY24.

Nishat Mills Limited (NML): FY24 Analyst Briefing takeaways – By AKD Research

Nov 27 2024


AKD Securities


  • Nishat Mills Limited (NML) held its corporate briefing session today to discuss FY24 financial results and provide insights on the future outlook. Key takeaways from the call are as follows:
  • NML’s NPAT declined to PkR6.4bn during FY24, down 48%YoY, led by decline in gross margins to 10.8% during the year (vs. 14.9% in FY23). Furthermore, the effect of super tax and higher financial charges (up 51%YoY) dampened the bottom-line.
  • Company’s sales mix comprises of Yarn, Greige cloth, processed cloth, made-ups, towels and garments, which hold 27%/20%/20%/16%/7%/10% share in revenues, respectively.

IBL HealthCare Ltd. (IBLHL): FY24 Analyst Briefing takeaways – By AKD Research

Nov 26 2024


AKD Securities


  • IBL HealthCare Ltd. (IBLHL) held its corporate briefing today to discuss its FY24 financial results and future outlook. Following are the key highlights:
  • Company posted topline of PkR3.6bn in FY24 compared to PkR4.0bn in FY23, down 11% YoY, due to supply chain constraints amid plant shutdown of Mead Johnson in Thailand.
  • Moreover, company’s profit for the year clocked in at PkR7.6mn (EPS: PkR0.09) in FY24 compared to PkR309mn (EPS: PkR3.61) in FY23, due to discounts offered amid limited shelf life of food products.

Economy: SBP revises profit sharing guidelines for IBIs and Commercial Banks – By AKD Research

Nov 26 2024


AKD Securities


  • The SBP has revised guidelines for profit sharing on saving deposits for Islamic Banking Institutions (IBIs), effective January 1, 2025. IBIs will pay return on saving deposits—excluding those held by FIs, PSEs and Public Ltd Cos. —at a minimum rate of 75% of the weighted average gross yield of investment pools. The yield will be calculated as monthly gross earnings of average monthly assets (excluding fixed assets). However, pools used for Shariah-compliant standing ceiling facilities and open market operations (OMOs) are excluded from this calculation.
  • The new profit-sharing framework for IBIs negatively impacts MEBL under our coverage space, with estimated negative impact of 13%/8% for CY25/CY26F from our base case, as we had already assumed the impact of narrowing NIMs from CY25 onward.

Unity Foods Limited (UNITY): FY24 Analyst Briefing Takeaways – By AKD Research

Nov 25 2024


AKD Securities


  • Unity Foods Ltd. (UNITY) held its corporate briefing today to discuss its FY24 financial results and future outlook. Following are the key highlights:
  • Company posted topline of PkR83.0bn in FY24 compared to PkR100.9bn in FY23, down 17.6%YoY, due to declining local edible oil prices, resulting in negative parity compared to international prices.
  • Moreover, company’s loss for the year clocked in at PkR3.4bn (LPS: PkR2.85) in FY24 compared to a profit of PkR675mn (EPS: PkR0.57) in FY23, amidst high finance cost.

Fertilizer: Rabi season to ease inventory levels – By AKD Research

Nov 19 2024


AKD Securities


  • Urea offtakes declined due to deteriorating farmer incomes. On the contrary, DAP sales surged by 95%YoY, driven by the onset of the Rabi season.
  • FFC’s urea sales dropped by 12%YoY in Aug’24. While, EFERT urea offtakes experienced a 42%YoY drop, due to price disparity.
  • Companies on the Mari gas network i.e., FFC and FATIMA (base plant), continue to benefit from 53%YoY lower gas prices.