Morning News: World Bank to lend Pakistan $20bn over 10 years – By WE Research

Jan 6 2025



  • The World Bank is likely to approve $20 billion for Pakistan over a 10-year period for improving the country’s key sectors, sources told Geo News on Saturday. Sources within the Ministry of Economic Affairs have said that the loan will be part of the World Bank's support under the Country Partnership Framework 2025-35, which focuses on sustainable economic development.
  • The Asian Infrastructure Investment Bank (AIIB) will provide $210.12 million in financing to Pakistan to reconstruct National Highway N-5 under the Resilient Recovery, Rehabilitation and Reconstruction Framework.
  • Alisher Tukhtaev, ambassador of the Republic of Uzbekistan, stated on Friday that the Uzbek Embassy is focused on increasing bilateral trade with Pakistan to $1 billion in the coming years.

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Lotte Chemical Pakistan Limited (LOTCHEM): 1QCY25 EPS clocked in at PKR0.44 – Below expectation - By Insight Research

Apr 17 2025


Insight Securities


  • LOTCHEM has announced its 1QCY25 result, wherein company has posted PAT of PKR0.7bn (EPS: PKR0.44) vs. PAT of PKR0.9bn (EPS: PKR0.59) in SPLY. The result is below our expectation due to lower than estimated revenue.
  • In 1QCY25, revenue decreased by 33% YoY, due to lower volumetric sales. While on QoQ basis, same is up by 6% possibly due to higher PTA prices and volumetric sales.
  • Gross margins of the company clocked in at 6.2%, up by 100bps/540bps YoY/QoQ, due to improved core delta.
Bank Alfalah (BAFL): 1Q2025 EPS at Rs4.49, up 65% QoQ (Earnings lower than industry expectations) - By Topline Reseach

Apr 17 2025


Topline Securities


  • Bank Alfalah (BAFL) announced its 1Q2025 result today, where the bank recorded consolidated earnings of Rs7.1bn (EPS of Rs4.49), down 29% YoY while up 53% QoQ.
  • Alongside the results, the bank also announced a first interim cash dividend of Rs2.5/share, which came in higher than expectations.
  • Net Interest Income (NII) for 1Q2025 settled at Rs33.6bn, up 6% YoY and 5% QoQ, driven by (1) higher asset yields and (
Bank Al-Falah Limited (BAFL): 1QCY25 EPS clocks-in at PKR 4.5; PAT down 29%YoY/up 52%QoQ - By Taurus Research

Apr 17 2025


Taurus Securities


  • 1QCY25 EPS: PKR 4.5. 1QCY25 PAT down 29%YoY. BAFL also announced an interim cash dividend of PKR 2.5/sh.
  • Net Interest Income (NII): Up 6%YoY/5%QoQ, despite pressure on yields, on the back of significant decrease in the cost of funds which can attributed to the build-up in current accounts during the quarter. To note BAFL’s CA ratio is up 4ppts QoQ with current accounts as of Mar’25 amounting to PKR 914Bn.
  • Non-Markup Income (NMI): Up 14%YoY/Down 21%QoQ. Sequential decline is owing to a surprising 16%QoQ fall in fee and commissions income, along with a 67%QoQ plunge in capital gains.
Pakistan Cement: 3QFY25E—Profitability to decrease by 21%QoQ - By Taurus Research

Apr 17 2025


Taurus Securities


  • We expect TSL cement universe PAT to clock-in at PKR 20.2Bn, down 21%QoQ on the back of drop in total dispatches by 13% QoQ (Net sales expected to fall by 10%QoQ in 3QFY25) i.e. domestic dispatches were down notably by 7%QoQ to 9.3Mn tons in 3QFY25 as construction demand plummeted due to winter effect and seasonality i.e. Ramadan and Eid Holidays. Further, Export dispatches dropped drastically by 35% to 1.7Mn tons in 3QFY25 owing to lower demand mainly.
  • TSL Cement universe gross margins are expected to arrive at 32%, down 2pptsQoQ due to drop in retail prices mainly in the North region (-6%QoQ) which put significant pressure on retention prices for North based players during the quarter. To note, capacity utilization in 3QFY25 fell to 51% compared to 58% during the previous quarter. Net income is expected to arrive at PKR 8.1Bn, down 9%QoQ.
  • During 3QFY25, we expect South based players to improve their margins on account of flat retail prices compared to the previous quarter along with lower international coal prices which has sustained higher retention prices during the quarter. To note, Richard Bay Coal prices averaged at USD 95.6/ton in 3QFY25, down 13% over the previous quarter.
The Pakistan Stock Exchange (PSX): Preconditions to takeoff – 2 - By Chase Research

Apr 17 2025



  • We revise our estimated fair value for Dec 2025 to PKR 41/share, reflecting stronger-than-expected value traded, a higher ADTV-to-market cap ratio, a reduction in the discount rate, and a rollover to December 2025. The stock offers a 45% upside from current levels. We maintain our Buy rating.
  • PSX operates as a unified national exchange, with over 500 listed companies across 38 sectors and a market capitalization exceeding PKR 14 trillion.
  • PSX owns 50% of NCCPL, which manages the clearing, settlement, and risk management functions of the stock market.
Power: Mar’25 generation up 5%YoY / 15%MoM - By Taurus Research

Apr 17 2025


Taurus Securities


  • Power generation in March 2025 clocked in at 8,409GWh, marking a 5%YoY increase and a 21%MoM recovery, driven by seasonal improvement in demand as the weather changes. This rebound follows the February slowdown, where generation had declined to 6,945GWh due to reduced industrial and household demand during winter.
  • For the 9MFY25, power generation dropped by 2%YoY, declining to 90,147GWh from 92,345GWh recorded in the SPLY.
  • Hydel generation declined sharply by 41%YoY and 31%MoM, contributing only 1,297GWh amid lower water availability. In contrast, coal-based generation surged 1.2xYoY to 1,938GWh and 68%MoM, likely due to better plant availability and reduction in global coal prices. Nuclear generation rose 7%YoY and 20%MoM, contributing the highest share at 2,223GWh. Elsewhere, generation from expensive sources like HSD and furnace oil dropped to 0%, aligning with the Government’s strategy to transition toward more cost-efficient and sustainable energy sources.
Technical Outlook: KSE-100; Moving averages to limit downside - By JS Research

Apr 17 2025


JS Global Capital


  • The KSE-100 index witnessed a volatile session to close at 116,020, down 755 points DoD. Volumes stood at 482mn shares compared to 479mn shares traded in the previous session. The index is moving towards the 30-DMA which is currently at 115,706 where a fall below targeting the 50-DMA at 114,542. However, any upside will find resistance in the range of 116,400-117,430 levels. The momentum indicators are mixed, signaling no clear trading view. We advise investors to ‘Buy on dips’, with risk defined below the 50-DMA. The support and resistance levels are at 115,390 and 117,037 levels, respectively.
Morning News: Roshan Digital Account inflows hit $235m in March, total crosses $10bn - By Vector Research

Apr 17 2025


Vector Securities


  • Total inflows into Roshan Digital Accounts (RDA) reached $235 million in March 2025, pushing cumulative inflows past the $10 billion mark, according to the latest data from the State Bank of Pakistan (SBP).
  • Terming Pakistan’s tax system highly ‘unfair and absurd’, the World Bank (WB) has called for bringing property into the tax net while ensuring it is accurately recorded and taxed. According to the WB, the increased burden on the salaried class could only be reduced by expanding the tax base and incorporating all incomes into the tax net.
  • Prime Minister Shehbaz Sharif Wednesday credited Beijing with Islamabad’s IMF programme saying it wouldn’t have been possible without the neighbouring country’s support. The premier’s remarks — made during a ceremony held in connection with the PM’s initiative for capacity building of 1,000 agriculture graduates in China — came in the context of last month’s deal between Islamabad and the IMF on the first review of the ongoing 37-month bailout programme of $7 billion.
Lotte Chemical Pakistan Limited (LOTCHEM): 1QCY25 Preview: Profitability to stay muted - By Insight Research

Apr 16 2025


Insight Securities


  • LOTCHEM is expected to post a PAT of PKR806mn (EPS: PKR0.50) in 1QCY25 vs. loss of PKR19mn (LPS: PKR0.01) in preceding quarter amid better core delta. While on YoY basis profitability inch up by ~2%. To note, International PTA prices plunged by ~13% YoY to clock in at ~US$682/ton. Similarly, PX prices witnessed a decrease of ~16% YoY to clock in at US$868/ ton, resulting in an increase of ~9% in PTA-PX spread. Company’s topline is expected to decrease by 25% YoY to clock in at PKR24.3bn in 1QCY25, amid lower volumetric sales. Whereas, same is expected to increase by ~20% QoQ due to higher volumetric sales. Gross margins of the company are estimated to clock in at 6.5% in 1QCY25, witnessing an increase of ~130bps/5.7ppts YoY/QoQ on account of improved core delta. Selling and distribution expense is expected to increase by 39%/20%, YoY/QoQ.
  • EPCL is expected to post a consolidated LAT of PKR264mn (LPS: PKR0.29) in 1QCY25 vs. LAT of PKR900mn (LPS: PKR0.99) in SPLY. Company’s topline is expected to increase by 12% YoY to clock in at PKR18.5bn in 1QCY25, amid higher volumetric sales. While, same is expected to decline by ~13% QoQ primarily due to lower PVC prices. Gross margins are estimated to clock in at 10.2% in 1QCY25 witnessing an increase of ~380bps YoY, attributable to higher volumetric sales. While on QoQ basis, same is expected to decline by ~390bps amid lower core delta and higher gas prices. To note, International PVC prices decline by ~4%/5% YoY/QoQ to clock in at ~US$756/ton. Similarly, PVCEthylene margins witnessed a decline of ~5%/10% YoY/QoQ. Selling and distribution expense is expected to decrease by 32% YoY, whereas same is expected to go down by ~8% QoQ. Financial charges are anticipated to decrease by 22%/27% YoY/ QoQ to clock in at PKR1.3bn, primarily due to decline in debt level and interest rates.
Economy: Rating upgrade: Fitch upgrades Pakistan’s rating to ‘B-’ from ‘CCC+’ - By Foundation Research

Apr 16 2025


Foundation Securities


  • Fitch has upgraded Pakistan’s long term Issuer Default Rating (IDR) to ‘B-’ from ‘CCC+’ and has termed the country’s outlook ‘stable’.
  • The ratings agency highlighted key metrics behind the upgrade which included the following:
  • Fitch expressed confidence in Pakistan’s progress on the fiscal front with reduced deficits and implementation of structural reforms. Further, the agency stressed upon tight economic policy that is expected to support build-up of forex reserves and limited external financing needs
Morning News: Trade gap with ME widens - By WE Research

Apr 15 2025



  • Pakistan’s trade deficit with the Middle East widened by 9.75% to $9.35 billion in the first eight months of FY25, mainly due to a surge in petroleum imports, particularly a 20.29% increase in crude oil volumes. While exports to the region rose modestly—by 3.56% to $2.095 billion—imports jumped 8.56% to $11.44 billion during the same period. Despite a narrowing of the trade gap in FY24 due to lower petroleum consumption, the deficit has grown again, raising concerns. Pakistan recently signed a free trade agreement with GCC states to address the imbalance, with notable export growth to the UAE, Saudi Arabia, and Qatar. Exports to Saudi Arabia rose 10.59% and to the UAE by 5.84% during July-February, while imports from both also fluctuated. However, exports to Bahrain, Kuwait, and Qatar declined significantly, while imports from these countries mostly increased, further contributing to the widening trade deficit.
  • In the upcoming 2025–26 federal budget, the Pakistani government is expected to raise taxes on a wide range of food and beverage items to increase tax revenue. Proposed measures include doubling the excise duty on soft drinks, sweetened beverages, and juices from 20% to 40%, while introducing a new 20% tax on industrial dairy products. Meat products, bakery goods, and confectionery items— such as chocolate, pastries, and cereals—are also likely to face a 50% tax increase, along with frozen desserts and products made from animal or vegetable fats. These tax hikes are planned to be implemented gradually over three years. Simultaneously, the defence budget is set to increase by Rs159 billion to Rs2,281 billion for FY26, marking a 7.49% rise from the previous year and a Rs263.2 billion increase since FY24, highlighting a continued focus on national security amid broader fiscal reforms.
  • Federal Minister for Finance and Revenue, Senator Muhammad Aurangzeb, chaired a high-level meeting on priority sector lending aimed at aligning Pakistan’s financial sector with the government's export-led growth agenda. Attended by key officials from the State Bank, the Pakistan Banks Association, and leading banks, the session emphasized the banking sector's vital role in facilitating foreign direct investment and supporting export-oriented industries. The minister highlighted the successful Pakistan Minerals Summit and Maersk Line’s $2 billion investment in maritime infrastructure as indicators of investor confidence. He stressed the need for sustainable, investment-led economic growth, avoiding past boom-bust cycles. Notably, this year’s budget process was initiated early, incorporating stakeholder feedback from commerce chambers. Zafar Masud of the PBA presented updates on banking support for agriculture, SMEs, and digital sectors, including initiatives like electronic warehouse receipt finance and SME performance indices. The minister concluded with a call for coordinated efforts to develop fintech-driven credit solutions for smallholder farmers and to ensure long-term economic transformation rooted in stability, inclusivity, and resilience.
Morning News: Oil extends decline as US-China trade war weighs on global growth outlook - By WE Research

Apr 14 2025



  • Oil prices dropped on Monday due to concerns that the intensifying trade war between the United States and China could slow global economic growth and reduce fuel demand. Brent crude futures fell by 0.45% to $64.47 per barrel, while U.S. West Texas Intermediate crude decreased by 0.44% to $61.23. Both have lost approximately $10 a barrel since the beginning of April. Goldman Sachs predicts that oil prices will remain lower for the rest of 2025 and 2026, citing weak global demand, particularly in petrochemical feedstocks. The trade war has escalated, with China raising tariffs on U.S. imports and the U.S. imposing new duties on Chinese technology products. Concerns about a declining Chinese economy, highlighted by falling inflation and producer prices, have led to fears of reduced oil demand. U.S. energy firms have responded by cutting oil rigs, marking the largest weekly reduction since June 2023. However, potential pressure on Iran’s oil exports could offer some support to oil prices.
  • Finance Minister Muhammad Aurangzeb shared Pakistan's vision for economic growth, focusing on high-potential sectors like IT and minerals, inspired by Singapore’s export-driven model. He emphasized that copper, like nickel for Singapore, could be a significant export driver for Pakistan. The government is addressing barriers to investment and aims to ease the tax burden on salaried individuals while ensuring inflation reduction and improved industrial growth through lower financing costs and power tariffs. Aurangzeb also mentioned the privatisation of 24 national entities and efforts to improve tax policies. He highlighted the government's commitment to consulting the private sector and resolving systemic issues to boost confidence and ensure the benefits of economic policies reach the common man. The Lahore Chamber of Commerce and Industry (LCCI) commended the government's progress in lowering inflation and interest rates, while also calling for reforms in tariff structures and long-term economic planning to support sustainable growth.
  • Finance Minister Muhammad Aurangzeb has stated that Pakistan has no plans to retaliate against the tariffs imposed by the Trump administration. In an interview with the BBC, he acknowledged concerns about the uncertainty created by these tariffs and emphasized the importance of dialogue moving forward in the current global trade environment. He clarified that Pakistan would not respond with countermeasures, despite the potential challenges posed by the U.S.-China trade tensions. While recognizing the U.S. as a long-time strategic partner, Aurangzeb highlighted the importance of maintaining strong relations with China as well. Although former President Donald Trump had initially announced a 29% tariff on Pakistani exports, its implementation has been delayed by 90 days, with a minimum tariff of 10% still affecting all countries
Morning News: IMF team due next week to discuss taxation proposals for next budget - By WE Research

Apr 11 2025



  • A technical team from the IMF is scheduled to visit Pakistan starting April 14, 2025, to engage in discussions with senior officials of the Federal Board of Revenue (FBR) regarding taxation proposals for the FY2025-26 budget. The talks will focus on expanding the tax base by bringing retailers and other untaxed sectors under the tax net, while the government is also considering reducing tax rates for the salaried class. Both parties are expected to explore the inclusion of high-income pensioners in the tax framework. Meanwhile, the IMF’s governance and anti-corruption diagnostic team will be concluding its visit. Additionally, a high-level Pakistani delegation, headed by Finance Minister Mohammad Aurangzeb, will attend the annual spring meetings of the IMF and World Bank in Washington, D.C., from April 21 to 26, 2025.
  • Prime Minister Shehbaz Sharif has halted a proposal to waive the 18% sales tax on local supplies of commodities, raw materials, and machinery to registered exporters under the Export Facilitation Scheme (EFS), due to concerns over potential objections from the IMF. The proposal, originally put forth by a committee led by Planning Minister Ahsan Iqbal, aimed to restore tax exemptions and reintroduce insurance guarantees to address anomalies that favor imports over local procurement—an issue impacting domestic industries like ginning factories. While some officials suggested revisiting the matter with the IMF, the Prime Minister rejected the idea, instead calling for a balanced solution that does not disadvantage local producers. The government is considering imposing the same 18% tax on imports to level the playing field. The PM emphasized boosting exports remains a top priority and urged the committee to incorporate industry feedback and develop consensus-based recommendations. The EFS, launched in 2021, has undergone stricter controls in recent months to curb misuse, including reduced utilization periods and enhanced monitoring.
  • Pakistan’s total liquid foreign exchange reserves increased by $173 million during the week ending April 4, 2025, reaching $15.75 billion, according to the State Bank of Pakistan (SBP). This rise includes a $23 million gain in SBP-held reserves, which stood at $10.699 billion, up from $10.676 billion the previous week. Additionally, net reserves held by commercial banks saw a notable increase of $150 million, reaching $5.053 billion compared to $4.903 billion the week before.
Morning News: IMF’s RSF; Pakistan to get $1.3bn in tranches - By WE Research

Apr 3 2025



  • The International Monetary Fund (IMF) announced that Pakistan will receive $1.3 billion under the Resilience and Sustainability Facility (RSF) in tranches over 28 months, subject to approval by the IMF's Executive Board. This follows a staff-level agreement reached on March 25, 2025, after the first review of Pakistan's 37-month Extended Fund Facility (EFF), which was approved in September 2024 for $7 billion. The RSF disbursements, which are spread over the duration of the arrangement, will be provided alongside a $1 billion disbursement from the EFF once the Executive Board approves the first review.
  • Azerbaijan has offered over $1 billion in cash deposits to Pakistan to fund the construction of the $1.2 billion Sukkur-Hyderabad motorway, following a request from Prime Minister Shehbaz Sharif during his recent visit. The proposal includes two options: Azerbaijan’s State Oil Fund placing a term cash deposit with Pakistan’s State Bank, which would then lend the money to the National Highway Authority (NHA), or Azerbaijan, in collaboration with the Islamic Development Bank, directly funding the project. Pakistan has also sought financing for the Hyderabad-Karachi motorway (M-9), estimated to cost $600 million. Despite this offer, there is a lack of consensus among Pakistani government departments, with the Finance Ministry opposing the cash deposit route. The NHA is exploring options, including public-private partnerships, to move forward with the projects, but delays are expected due to limited fiscal space. This comes amid ongoing efforts to secure foreign investments and address Pakistan's infrastructure needs while grappling with political and economic instability.
  • The federal government has announced a reduction in the price of petrol by Rs1 per litre, effective from March 29, lowering the price to Rs254.63 from Rs255.63. However, the price of High-Speed Diesel remains unchanged at Rs258.64 per litre. The price adjustments, recommended by the Oil and Gas Regulatory Authority (OGRA), were made based on fluctuations in international market rates, with the aim of providing relief to consumers.
Morning News: IMF team due in May to finalise FY26 budget: PM ecstatic as IMF deal to unlock $2.3bn for Pakistan - By WE Research

Mar 27 2025



  • The International Monetary Fund (IMF) and Pakistan have reached a staff-level agreement (SLA) on the first review under the Extended Fund Facility (EFF) and a new climate finance arrangement under the Resilience and Sustainability Facility (RSF). The agreement, subject to approval by the IMF’s Executive Board, could unlock approximately $2.3 billion in funding for Pakistan by early May 2025. The deal focuses on fiscal discipline, energy sector reforms, climate resilience, and structural changes to foster economic growth. Despite challenges such as geopolitical shocks and global financial tightening, the IMF acknowledged progress in restoring macroeconomic stability in Pakistan. The Pakistani government has committed to advancing reforms to ensure long-term stability, with an emphasis on tax reforms, controlling inflation, and improving energy sector efficiency. Additionally, Pakistan is exploring new financial avenues, including potentially issuing Panda Bonds in Yuan to tap into China's capital market.
  • The Reko Diq copper and gold project in Balochistan, with reserves valued at over $60 billion, has seen three state-owned energy companies—Oil and Gas Development Company Ltd (OGDCL), Pakistan Petroleum Ltd (PPL), and Government Holdings (Pvt) Ltd (GHPL)—more than double their funding commitments from $900 million to $1.88 billion. The project, which will be the world's first fully solarpowered copper-gold operation, is expected to yield 13.1 million tonnes of copper and 17.9 million ounces of gold over its 37-year life. The updated feasibility study also confirmed a 25% rate of return on investment. Phase 1 of the project, set to begin in 2028, will process 45 million tonnes of material annually, with Phase 2 doubling that by 2034. The project's funding will include a mix of shareholder equity and up to $3 billion in project financing. OGDCL, PPL, and GHPL, which hold a collective 25% stake in the project, have approved increased funding to reflect their proportional shares in the capital investment, with Barrick Gold Corporation holding the remaining 50% stake.
  • Pakistan's economy grew by just 1.7% in the second quarter of the current fiscal year, with the livestock and services sectors driving growth due to lower inflation. However, the agriculture and industrial sectors faced significant challenges, including high interest rates, rising energy costs, and adverse weather conditions. Agriculture saw a sharp decline, with key crop production falling by 7.7%, while industrial output contracted by 0.2%, particularly in mining, large-scale manufacturing, and construction. The services sector performed best, growing by 2.6%, supported by a decline in inflation from 29% to 6.3%. Despite efforts to reduce electricity prices and offer fiscal stimulus, tight economic conditions, including record tax impositions and high interest rates, hindered broader economic progress. The government's target of 3.6% annual growth for FY2024-25 now seems unlikely to be met.
Morning News: Furnace oil exports hit record 933,000 tonnes in eight months - By WE Research

Mar 19 2025



  • Pakistan exported a record 933,000 tonnes of furnace oil in the first eight months of the current financial year, as the country's power sector phases out its use due to high costs and environmental concerns. Exports dropped to 39,000 tonnes in February but rebounded in March, driven by a government decision allowing refineries to sell surplus oil internationally. Furnace oil's role in power generation has diminished significantly, with little contribution to electricity production in February. Refineries are working to reduce high-sulphur furnace oil output, but delays in upgrades due to sales tax issues have hampered progress. Despite rising exports, refineries face challenges in disposing of furnace oil, affecting their operations.
  • Prime Minister Shehbaz Sharif is set to reduce the power tariff by Rs8 per unit, effective from April 1, 2025, following approval from the IMF. The reduction includes a permanent Rs4.73 per unit cut due to agreements with independent power producers (IPPs), currency adjustments, and changes in government power plants’ returns. An additional Rs1.30 per unit relief will be provided temporarily due to the non-reduction of petroleum prices, amounting to an estimated Rs168 billion. The government is also working on further reducing the tariff by Rs2 per unit. However, the electricity duty will remain intact, as the Punjab government opposed its removal, and the IMF blocked a proposed reduction in GST from 18% to 12%. Additionally, the PTV fee will be removed from bills starting July 2025, with the government planning to allocate a separate budget for it in FY2026.
  • The government’s renegotiation of agreements with Independent Power Producers (IPPs) has resulted in lifetime savings of Rs1.3 trillion, with the aim of passing these savings on to consumers. Previously, consumers were paying up to Rs2.8 trillion annually to IPPs, some of which received payments without producing electricity due to flawed agreements. The renegotiations have already led to a Rs7 per unit reduction in electricity tariffs. Over the past eight months, tariffs were reduced by Rs4.96, and agreements with 14 IPPs and eight bagasse-based IPPs secured savings of Rs1.33 trillion. Planned reforms include converting coal plants to Thar coal, improving efficiency in Distribution Companies (DISCOs), and promoting solarisation of tubewells in Balochistan. Additionally, IPPs have agreed to return Rs31 billion in excess profits, and various LPI claims have been waived as part of the agreements.
Fauji Cement Company Limited (FCCL): Poised for Continued Growth - Market Weight - By WE Research

Mar 18 2025



  • Since Jan’2024, the Pakistan cement sector has witnessed a swift recovery on the back of anticipated interest cut, where the industry stock performance increased by 46%. Among the local peers, FCCL has been the key driver on this rally, delivering an 92% return, with its share price surging from PKR 18.95/sh on January 1, 2024, to PKR 36.4/sh on January 1, 2025. However, despite this strong market performance, cement dispatches in CY24 remained stagnant/low, where local demand reached at 38.2 Mn tons, depicting a decline of 4.5% YoY. However, we expect FY25 to be a strong year for the industry, driven by lower interest rates and enhanced purchasing power across both consumer and industrial sectors, where we anticipated local dispatches to clock in at 38Mn tons 4% YoY increase from FY25.
  • We have a Market Weight stance on FCCL, with a DCF-based target price of PKR 64.40 per share for DEC’25 offering 40% upside potential. FCCL is currently valued at ~US$39.17EV/ton compared to 5-year average of ~US$32.65EV/ton. On EV/EBIDTA basis, stock is trading at ~11.07x as compared to 5-year average of ~6x.
  • Our liking for the stocks emanate from 1) Healthy gross margins driven by cost efficiency initiatives, 2) Recent capacity expansion to enhance market footprint, 3) Strong cash flow led to higher payouts & 4) Reducing interest rate to increase profitability.
Morning News: Chinese PM to visit Pakistan next month: envoy - By WE Research

Mar 13 2025



  • Chinese Ambassador to Pakistan Jiang Zaidong emphasized the importance of Pakistan and China working together as key partners in modernization, economic growth, and international stability during a seminar organized by the China Pakistan Study Centre. He highlighted the deep and enduring friendship between the two nations, China's economic resilience, and its investments in tech and green initiatives. Zaidong underscored Pakistan's crucial role in China's strategic initiatives, including the China-Pakistan Economic Corridor (CPEC) and space cooperation. He also outlined China's focus on poverty alleviation, job creation, and global peace. Other speakers, including Ambassador Sohail Mahmood and Masood Khan, discussed China's leadership in global development, the success of initiatives like the Belt and Road Initiative, and the evolving role of CPEC. They also highlighted the significance of media and think tanks in fostering understanding and the need for continued collaboration on regional security and global challenges.
  • Oil & Gas Development Company Limited (OGDCL) has successfully restored hydrocarbon production at the Rajian-11 heavy oil well in Punjab’s Chakwal district after a four-year suspension. The company achieved this by installing an electrical submersible pump (ESP), in line with its strategy to boost production through advanced artificial lift techniques. Rajian-11, which reaches a depth of 3,774 meters, had been inactive since 2020 due to formation challenges. With the ESP installation, the well now produces 1,000 barrels per day (BPD) of oil. The Rajian Oil Field, discovered in 1994 and fully owned by OGDCL, is part of the company’s effort to maximize hydrocarbon recovery and improve operational efficiency. This development follows a 44% year-on-year decline in OGDCL’s profit for the quarter ending December 31, 2024, attributed to lower sales and higher taxes.
  • K-Electric (KE) has requested a provisional negative adjustment of Rs 4.84 per unit in the Fuel Charges Adjustment (FCA) for January 2025, which would result in a financial impact of Rs 4.695 billion for consumers. Additionally, KE is seeking to adjust Rs 13.5 billion from previous months. The National Electric Power Regulatory Authority (NEPRA) will hold a public hearing on March 20, 2025, to review this request. KE's submission includes an adjustment for fuel cost variations, considering factors like partial load, open cycle, degradation curves, and startup costs for the period from July 2023 to January 2025. The hearing will deliberate on whether the FCA adjustment is justified, KE's adherence to the merit order in dispatching power, and the reasonableness of the accumulated fuel costs. KE's response highlights concerns over low demand in December 2024 and underutilization of its own plants, which led to higher costs. KE also emphasized the need to resolve interconnection issues with the National Transmission and Dispatch Company (NTDC) to improve cost-efficiency and system performance.
Morning News: Uzbek-Pak ties get boost: leaders eye $2bn trade - By WE Research

Feb 27 2025



  • Pakistan and Uzbekistan have agreed to boost bilateral trade from $400 million to $2 billion and explore opportunities in investment, connectivity, and tourism. During a two-day visit by Prime Minister Shehbaz Sharif to Uzbekistan, both leaders discussed the Trans-Afghan Railway project, which aims to connect Central Asia with South Asia and could transform regional trade. The leaders also emphasized the importance of regional stability, including a peaceful Afghanistan, and the need to prevent its soil from being used by militant groups. Prime Minister Sharif highlighted Pakistan’s economic progress and invited President Mirziyoyev to visit Pakistan, a proposal that was accepted. Both leaders agreed to establish a High-Level Strategic Council to further promote cooperation, especially in areas like energy, mines, and rail connectivity.
  • Khyber Pakhtunkhwa Oil & Gas Company Limited (KPOGCL) signed an exploration agreement for the Miran Block in North Waziristan with a consortium including Oil & Gas Development Company (OGDCL), Pakistan Petroleum Limited (PPL), and Government Holdings Private Limited (GHPL). KPOGCL will hold the majority stake with 51% ownership, while the remaining 49% will belong to the OGDCL-led consortium, which will also bear the investment of Rs 20 billion over the next three years. The project aims to explore significant oil and gas reserves, with strong prospects for addressing Pakistan’s energy crisis. Chief Minister Ali Amin Gandapur highlighted the project’s strategic importance, emphasizing its potential to bring development, create jobs, and reduce militancy in the region. He also criticized past policies for not fully exploiting KP’s natural resources and reaffirmed the province’s key role in Pakistan’s energy production.
  • The government has decided to pass on the reduction in electricity prices due to fuel cost adjustments (FCA) to the agriculture sector and domestic consumers using up to 300 units per month. The Ministry of Energy has asked the National Electric Power Regulatory Authority (Nepra) to implement this decision, which aligns with past policy guidelines but adjusts for recent tariff rationalizations. The decision aims to provide relief to these consumers, reversing previous exclusions of agricultural and unprotected domestic consumers from negative FCA adjustments. Separately, K-Electric (KE) consumers will receive a tariff relief of Rs 4.95 per unit for December 2024 FCA, amounting to Rs 4.94 billion, which will be reflected in March 2025 bills. This marks the fourth consecutive negative FCA for KE customers since September 2024. The relief is attributed to factors like zero furnace oil use and increased power supply from CPPA-G. Various stakeholders, including consumer representatives, discussed the FCA's impact, with some requesting FCA adjustments in the summer months to offset higher electricity bills.
Morning News: IMF appreciates govt commitment to governance, corruption assessment - By WE Research

Feb 24 2025



  • An International Monetary Fund (IMF) mission recently visited Pakistan to assess governance and corruption vulnerabilities as part of the country's ongoing $7 billion Extended Fund Facility (EFF). The delegation, led by Joel Turkewitz, met with key government institutions, including the judiciary and financial regulators, to evaluate governance across six core areas, including fiscal management, central bank operations, and anti-money laundering measures. The IMF praised Pakistan’s commitment to the assessment and plans to return later this year for further evaluation. Additionally, Pakistan expects two more IMF missions in March to discuss additional financing of over $1 billion under the Resilience and Sustainability Trust (RSF) to address climate change vulnerabilities. The RSF funding, which offers long-term, low-cost repayment terms, was formally requested in October 2023.
  • Pakistan and Turkiye are working to enhance bilateral trade and economic cooperation by leveraging agreements like the Preferential Trade Agreement (PTA) and Free Trade Agreement (FTA). During Turkish President Recep Tayyip Erdogan’s recent visit, the Pakistan-Turkiye High-Level Strategic Cooperation Council (HLSCC) emphasized expanding collaboration in trade, banking, energy, defense, and technology. Experts suggest addressing non-tariff barriers and anti-dumping laws while boosting exports in textiles, agriculture, and IT to achieve a $5 billion trade target. Pakistan’s exports to Turkiye in FY24 amounted to $335.3 million, while imports stood at $491.3 million. Concerns over brain drain have prompted calls for joint ventures in IT, defense, and advanced technology sectors, with Pakistanis contributing to key Turkish projects like fighter jets and drone manufacturing. Economic stakeholders advocate for greater industrial collaboration, direct trade routes, and enhanced private sector engagement to maximize trade potential.
  • Finance Minister Muhammad Aurangzeb has announced plans to ease the financial burden on the salaried class in the upcoming budget, aiming to provide economic relief amid fiscal challenges. Speaking in Lahore, he highlighted positive economic indicators, including an increase in remittance senders and inflows through the Roshan Digital Account. Aurangzeb emphasized the private sector’s role in economic progress and reaffirmed government support for the construction industry while curbing speculative real estate activities. With inflation and high taxes weighing on the salaried class, the upcoming budget is expected to introduce measures balancing relief and fiscal stability.