For the period Nov 12, 2018 Nov 16, 2018 - BIPL Direct · Ghandhara to assemble Renault truc ks|...
Transcript of For the period Nov 12, 2018 Nov 16, 2018 - BIPL Direct · Ghandhara to assemble Renault truc ks|...
The Week in Review For the period Nov 12, 2018 – Nov 16, 2018
News This Week
Forex reserves fall to USD13.8bn
C/A deficit narrows 4.6% in July-Oct
FDI slips 46.4%YoY in July-October
Trade deficit shrinks to USD11.8bn
Overseas Pakistanis remit USD7.4bn in 4MFY19
Auto sales remain flat at 83,201 units in four months
ECC allows PKR36bn financing for circular debt
Steel re-rolling industry crisis deepens
Ghandhara to assemble Renault trucks
KA Hanteng Motor gets ‘Greenfield’ status
KSE-100 – Volatile week at bourse
Stock Market Overview
The outgoing week remained volatile as investors remained abreast with news flow regarding exclusion of certain stocks from MSCI
and developments on negotiations with IMF, where KSE100 index exhibited an increase of 0.7%WoW to 41,661pts. Additionally,
market participants remained dull during the week as evident from decline in ADT by 8.5%WoW while ADTV increased by 1.3%WoW.
Foreign investors continued to remain net seller, exhibiting an outflow of USD24mn.
GATI, CHCC, COLG, MUREB and GHGL were the major gainers while SEARL, SHFA, TRG, HCAR, and NESTLE were the major losers in the
benchmark KSE-100 this week.
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Market Review
The outgoing week remained volatile as investors remained abreast with news flow regarding exclusion of certain stocks from MSCI and developments on negotiations with IMF, where KSE100 index exhibited an increase of 0.7%WoW to 41,661pts. Additionally, market participants remained dull during the week as evident from decline in ADT by 8.5%WoW while ADTV increased by 1.3%WoW. Foreign investors continued to remain net seller, exhibiting an outflow of USD24mn. During the week, PAMA released automobiles data for Oct’18 wherein auto sales grew by 6%YoY to 24,850 units, taking the cumulative sales to 83,201 units for 4MFY19, down 0.7%YoY. Additionally, ECC allowed the energy of ministry to secure PKR36bn in order to partially settle circular debt. Furthermore, lower demand emanating from the ban on the construction of high-rise buildings has resulted in shut down of some steel re-rolling mills in Sindh and Baluchistan provinces. On the macro front, SBP foreign exchange reserves declined by 3.0%WoW to USD7.5bn owing to external debt servicing and official payments. Pakistan’s current account deficit narrowed by 4.6% 4MFY19 on lower trade gap in goods, declining by 2.0% amid stronger exports, and higher remittance inflows (up 15%YoY). On the other hand, FDI fell by 46.4%YoY during the same period in the face of slowdown in Chinese investments for CPEC-related projects, as Chinese inflows for 4MFY19 dropped 52%YoY to USD334.9mn.
Outlook Investors are likely to closely track developments regarding IMF negotiations with government, scheduled to be completed by next week. Moreover, the prospective inflow from KSA on the agreed amount of USD3.0bn would be a key trigger to rebuild the investor’s confidence.
KSE-100 – Volatile week at bourse
Date Open High Low Close Change Vol (mn)
12-Nov-18 41,414 41,572 41,053 41,096 -0.7% 178
13-Nov-18 41,112 41,202 40,761 41,152 0.1% 177
14-Nov-18 40,874 41,323 40,763 40,994 -0.4% 255
15-Nov-18 41,019 41,478 40,942 41,429 1.1% 255
16-Nov-18 41,536 41,805 41,429 41,661 0.6% 202
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News This Week
Economic highlights & Data points
Forex reserves fall to USD13.8bn| (The News): Pakistan’s total liquid foreign reserves fell 1.7%WoW to USD13.8bn during the week ended on November 9, the central bank said on Thursday. Net reserves with the State Bank of Pakistan dropped 3% or USD196mn to USD7.5bn. C/A deficit narrows 4.6% in July-Oct| (The News): Pakistan’s current account deficit narrowed by 4.6% or USD232mn in 4MFY19 on lower trade gap in goods and higher remittance inflows, the central bank figures on Thursday. The current account deficit stood at USD4.8bn during 4MFY19, compared with USD5.1bn in the same period last year. FDI slips 46.4%YoY in July-October| (The News): Foreign direct investment into Pakistan fell 46.4% to USD600.7mn in 4MFY19 from the same period a year earlier, the central bank data showed on Wednesday. In October, Pakistan’s cross-border investments dipped to USD161.2mn, compared with USD354.6mn in the corresponding month last year, the State Bank of Pakistan (SBP) data showed. Trade deficit shrinks to USD11.8bn | (Dawn): The country’s trade deficit during 4MFY19 shrank by 1.97%YoY to USD11.8bn from USD12.0bn, according to latest data released by Pakistan Bureau of Statistics on Friday. Overseas Pakistanis remit USD7.4bn in 4MFY19| (The News): Overseas Pakistani workers remitted USD7.4bn in 4MFY19, compared with USD6.4bn received during the same period in the preceding year. During Oct’18, the inflow of worker’s remittances amounted to USD2.0bn, which is 37.7% higher than Sept’18 and 20.9% higher than Oct’17.
Sector and Corporate highlights
Auto sales remain flat at 83,201 units in four months| (The News): Sales of cars, jeeps and light commercial vehicles (LCVs) remained almost flat at 83,201 during the first four months of the current fiscal year as frequent price hikes and tax restriction stifled auto demand, a brokerage reported on Monday. ECC allows PKR36bn financing for circular debt| (The News): Government on Monday allowed the ministry of energy to secure around PKR36bn from a syndicate of banks to defray power sector’s outstanding payments that reawakened the energy woes. Steel re-rolling industry crisis deepens| (The News): The operations of almost all steel re-rolling mills in Sindh and Balochistan provinces have been shut down for an indefinite period, as a ban on the construction of high-rise and other buildings has deadened the demand. Ghandhara to assemble Renault trucks| (Dawn): Ghandhara Nissan Limited (GNL) has announced its plans to locally assemble Renault Trucks (RT) by end of 2019 at the manufacturing site in Port Qasim, according to a company release issued on Thursday. KA Hanteng Motor gets ‘Greenfield’ status| (BR): Government of Pakistan has awarded category-A Greenfield Investment status to KA Hanteng Motor Company Pvt Ltd, under automotive development policy 2016-21 which will bring an investment of about USD50mn in auto sector.
Sugar mills unwilling to start crushing amid ‘liquidity crunch’| (Dawn): The sugar industry has urged the government to fix sugarcane price in tandem with the selling price of sugar and asked for early payment of outstanding subsidies to come out of the woods.
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Stock Market – Last week in pictorals
Chart 1: KSE-100 Index
Source: PSX
Chart 2: KSE Advance/Decline Ratio
Source: PSX
Chart 3: Pak Foreign Portfolio Flows (US$mn; US$=PKR130)
Source: NCCPL
Chart 4: KSE- Volumes & Values
Source: PSX
Chart 5: Price to Money Ratio
Source: NCCPL
Chart 6: Off market activity
Source: PSX
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Economy Watch
Chart 7: Revenue Collection (PKRbn)
Source: SBP
Chart 8: Forex Reserves (US$mn)
Source: SBP
Chart 9: Import & Export (US$mn)
Source: SBP
Chart 10: Foreign Exchange Rate (PKR/US$)
Source: SBP
Chart 11: 6-mth T-Bill Yield (%)
Source: SBP
Chart 12: Yield Curve (%)
Source: SBP
Chart 13: KSE-100 Active Issues (ADTO-million shares)
Source: PSX
Chart 14: KSE-100 Least Traded Issues (ADTO- shares)
Source: PSX
Chart 15: KSE-100 Top Gainer (% change)
Source: PSX
Chart 16: KSE-100 Top Losers (% change)
Source: PSX
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Stock Market Synopsis Last week This Week %Change 1M 3M 12M
Mkt. Cap (US $ bn) 61.4 61.5 0.0% 56.5 69.8 79.7
Avg. Dly T/O (mn. shares) 233.1 213.4 -8.5% 257.5 189.7 185.0
Avg. Dly T/V (US$ mn.) 71.1 72.0 1.3% 73.7 57.3 66.3
No. of Trading Sessions 5.0 5.0 0.0 24.0 62.0 247.0
KSE 100 Index 41,388.9 41,660.8 0.7% 36,663.4 41,960.8 40,813.3
KSE ALL Share Index 29,935.3 30,020.0 0.3% 27,319.8 30,422.0 29,152.0
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