AKD Research research@akdsecurities.net

+92-21-111-253-111

Weekly Review

KSE-100 constantly remained under pressure during the outgoing week, declining by 2.3%

WoW to close at 45,808pts as investors indulged in profit taking after index remained on the

upward trajectory for last 6 weeks. After a significant result beat by CHCC, entire cement sec-

tor remained in the limelight and sector turned out to be the top performer for the week with

an increase of 5.2%WoW. However the sector failed to support the index as profit taking was

witnessed across all other major sectors where Oil & Gas Exploration witnessed a decline of

4.1%WoW while Commercial Banks declined by 3.9%. Key news flows for the week consisted

of i) Govt approving Russia's Sputnik V vaccine for emergency use and is also in process of

giving approval to private firms to import Covid shots which will be exempted from price caps,

ii) The Federal Cabinet giving final approval to the recommendations of the (CCoE) for pay-

ment of PkR403bn to IPPs, iii) TERF recording the highest increase of PkR51bn in one week, iv)

NEPRA notifying PkR1.54/kWh increase in electricity rates for ex-Wapda Discos, v) OGRA al-

lowing PkR13.42/mmbtu increase in tariff to SNGP, vi) Automobile sales increasing by 59/31%

YoY/MoM for Jan'21 taking the total increase for 7MFY21 to 28%YoY. Flow wise, Foreigners

remained net sellers during the week (US$-3.16mn) together with Banks (US$-12.38mn) which

was mainly absorbed by Individuals (net buy of US$12.65mn) and Companies (net buy of

US$8.4mn). Top performers during the week were, i) KOHC (+11.9%WoW), ii) PIOC (+10.6%

WoW), iii) DGKC (+10.5%WoW), iv) GATI (+6.9%WoW), and LUCK (+6.6%WoW) whereas lag-

gards were, i) FCEPL (down 15.4%WoW), ii) SNGP (down 12.1%WoW), iii) GATM (down 9.6%

WoW), and iv) FABL (down 8.8%WoW).

StockSmart

AKD Equity Research / Pakistan

Pakistan Weekly Update

Important disclosures includ-ing investment banking relationships and analyst certification at end of this report. AKD Securities does and seeks to do business with companies covered in its research reports. As a result, inves-

Important disclosures

Copyright©2020 AKD Securities Limited. All rights reserved. The information provided on this document is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to law or regulation or which would subject AKD Securities or its affiliates to any registration requirement within such jurisdiction or country. Neither the information, nor any opinion contained in this document constitutes a solicitation or offer by AKD Securities or its affiliates to buy or sell any securities or provide any investment advice or service. AKD Securities does not warrant the accuracy of the information provided herein.

www.akdsecurities.net

AKD Securities

TREC Holder & Registered Broker

Pakistan Stock Exchange

REP-019

Find AKD research on Bloomberg

(AKDS<GO>), firstcall.com and Reuters Knowledge

We expect the market to bounce back next week on the back of Govt's approval to private

firms to import Covid-19 vaccine which will speed up the vaccination drive in the country while

finalization of payment mechanism to IPPs will keep the entire energy chain in limelight, in our

view. Moreover, market will also set its sight on upcoming FATF review where Pakistan will

once again make a case for removal of its name from grey list. Major earnings' announcement

in the upcoming week include EFERT, KOHC, HBL, MEBL, ENGRO, MARI, DGKC and PSO.

12 February 2021

Outlook

Top-5 Volume Leaders

Symbol Volume (mn)

WTL : 866.17

TELE : 275.55

KEL : 180.46

PRL : 132.35

TRG : 125.01

Source: PSX & AKD Research

Indic e s KSE- 10 0 KSE- 3 0

This week 45,808 19,105

Last week 46,906 19,576

Change - 2.34% - 2.41%

Indic e s KMI- 3 0 Allsha re

This week 75,471 31,553

Last week 76,327 32,386

- 1.12% - 2.57%

Mkt Ca p. PkRbn US$ bn

This week 8,241 51.90

Last week 8,480 53.01

Avg. Da ily Turnove r ('mn sha re s)

This week 734.42

Last week 554.57

Change 32.4%

Source: PSX & AKD Research

Index & Volume Chart KSE100 Gainers & Losers

46,722

46,675

46,644 46,056

45,808

45,200

45,400

45,600

45,800

46,000

46,200

46,400

46,600

46,800

-

200,000

400,000

600,000

800,000

1,000,000

1,200,000

8-Feb 9-Feb 10-Feb 11-Feb 12-Feb

(Index)(Shrs'000)

Ready Volume (LHS) KSE100 Index (RHS)

-21.0%

-15.0%

-9.0%

-3.0%

3.0%

9.0%

15.0%

KO

HC

PIO

C

DG

KC

GA

TI

LU

CK

HA

SC

Ol

FA

BL

GA

TM

SN

GP

FC

EP

L

25,000

28,000

31,000

34,000

37,000

40,000

43,000

46,000

49,000

0

200

400

600

800

1,000

1,200

1,400

Feb-2

0

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20

Apr-

20

May-2

0

Jun

-20

Aug-2

0

Sep-2

0

Oct-

20

Nov-

20

Jan

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Feb-2

1

(Index)(share mn)

Volume in million (LHS) KSE-100 Index

AKD Securities Limited

12 February 2021

StockSmart

Pakistan Weekly Update

This Week’s Daily Reports

2

Pakistan Autos: Sales sprint into the New Year, (AKD Daily, Feb 12, 2021)

PAMA conveyed Jan’21 total automobile industry sales of 23,087 units (+31%MoM/+59%YoY), the highest in last 21 months, restoring demand comfortably to Pre-COVID levels. The upturn was led by Passenger Car sales (14,543 units, +29%MoM/+44%YoY), LCV/Pickup sales picking up to 2,972 units (+10%MoM/+65%YoY), while Truck sales remained muted at 290 units (-0.3%MoM/-26%YoY).

The automotive industry realized 7MFY21 cumulative sales of 126,714 vehicles (+28%YoY) encompassing 81,570 Passenger Cars (+18%YoY), 15,900 LCVs & Pickups (+56%YoY), 1,940 Trucks (-8%YoY), 360 Buses (-15%YoY) and 26,945 Tractors (+54%YoY), reversing the trend of cumulative declines experienced during Covid-19.

Segment wise sales showcase major uptick in premium vehicle segment of 1,300CC+ (6,944 units in Jan’21 +44%MoM/+27%YoY), while the 800CC- segment sales rallied as well (4,813 units +36%MoM/+104%YoY), with 1000CC+ segment sales sustaining (2,786 units -2%MoM/+23%YoY) for the month, moving segment wise composition of 1300CC+/1000CC/800CC cars to 48%/19%/33% for Jan’21 as against 43%/25%/32% in the preceding month.

Amongst major OEMs, PSMC/INDU/HCAR reported Jan’21 sales of 9,013/5,452/2,450 units ascending 19%/36%/39%MoM and 62%/36%/11%%YoY, taking the monthly PC+LCV sales to 17,515 units (+26%MoM/+47%YoY), demonstrating healthy recovery in demand of automo-biles, where new model launches, concessionary loan schemes (particularly for PSMC), and improved farmer economics are likely to have played a strong role.

We maintain our favorable stance on INDU with firm profitability in the backdrop of steady PKR dynamics, controlled inflation, low interest rates and ‘return-to-normal’ demand recovery post COVID-19, underpinned by the launch of vaccination drive at home. To note, the industry is now exhibiting signs of broad-based recovery, despite underreporting sales in absence of Kia numbers.

Pakistan Commodities: Bull run to continue, (AKD Daily, Feb 11, 2021)

Global commodity prices have bounced back to pre-pandemic levels, inflated by hopes of vac-cine, supply disruptions with countries such as Argentina and Russia imposing cap of exports/ export duty, and US economic stimulus package, with TRJ index +3.8%MoM and up 26.3%FYTD.

Crude prices continued their upsurge, with Arab Light averaging at US$54.2/bbl, up 11%MoM, but still down 20% from the levels witnessed in the same period last year. Higher prices in Jan’21 were a reflection of Saudi Arabia’s announcement to unilaterally cut 1.0mn bpd of crude oil production in Feb and Mar 2021 in addition to the agreement reached in the previous OPEC meeting, lowering its crude production to 8.1mn bpd.

China being the biggest consumer of coal has again been found dominating the market as in-ventory buildup before New Year uplifted coal prices to average of USD90/ton for Jan'21 against average of USD87/ton for Dec'20. However as we approach Chinese New Year, demand seems to have cooled down a bit and the same is being reflected in prices with coal prices cur-rently around USD83/ton, down 8% vs. Jan'21 average.

Commodity prices are expected to continue their bull-run in the medium run where uncertain-ties surrounding new coronavirus strain (Europe has already entered into lockdown) inducing strategic stock piling while push for economic recovery will also pull up demand.

LUCK: Portfolio companies joining the party, (AKD Daily, Feb 10, 2021)

Post release of detailed accounts for 2QFY21, we update our investment thesis, incorporating i) faster than expected normalization of working capital cycle, ii) impressive performance of portfolio companies, and iii) shift in power sources for LUCK as gas supply at Pezu remains suspended due to a pipeline fault.

LUCK’s venture into automobile sector has provided astounding returns with revenue for 1HFY21 increasing by 2.6xYoY to PkR44.3bn as Sportage and Picanto continue their stellar run while moving forward, a move towards double shift from Jan’21 will further uplift the topline and profitability. Operating margins of the segment also improved to 8.5% against 0.6/7.5% for

Feb 09, 2021

Feb 12, 2021

Feb 11, 2021

Source: PSX & AKD Research

46,300

46,370

46,440

46,510

46,580

46,650

46,720

46,790

46,860

46,930

9:3

2

9:5

5

10:1

8

10:4

2

11:0

5

11:2

8

11:5

2

12:1

5

12:3

8

13:0

2

13:2

5

13:4

8

14:1

2

14:3

5

14:5

8

15:2

2

Feb 10, 2021

46,500

46,570

46,640

46,710

46,780

46,850

46,920

46,990

47,060

9:3

1

9:5

6

10:2

0

10:4

5

11:0

9

11:3

4

11:5

8

12:2

3

12:4

7

13:1

2

13:3

6

14:0

1

14:2

5

14:5

0

15:1

4

45,800

45,950

46,100

46,250

46,400

46,550

46,700

46,850

47,000

47,150

9:3

2

9:5

5

10:1

8

10:4

2

11:0

5

11:2

8

11:5

2

12:1

5

12:3

8

13:0

2

13:2

5

13:4

8

14:1

2

14:3

5

14:5

8

15:2

2

46,500

46,580

46,660

46,740

46,820

46,900

46,980

47,060

47,140

9:3

1

9:5

6

10:2

0

10:4

5

11:0

9

11:3

4

11:5

8

12:2

3

12:4

7

13:1

2

13:3

6

14:0

1

14:2

5

14:5

0

15:1

4

Feb 08, 2021

46,500

46,580

46,660

46,740

46,820

46,900

46,980

47,060

47,140

9:3

1

9:5

6

10:2

0

10:4

5

11:0

9

11:3

4

11:5

8

12:2

3

12:4

7

13:1

2

13:3

6

14:0

1

14:2

5

14:5

0

15:1

4

AKD Securities Limited

12 February 2021

StockSmart

Pakistan Weekly Update

This Week’s Daily Reports

3

2QFY20/1QFY21.

Congo and Iraq have performed as well with 1HFY21 net profit increasing by 31.8/25.5%YoY for Congo/Iraq to PkR7.5/1.8bn while net margins have increased to 30/26% on the back of improved pricing and demand where upcoming clinker plant in Iraq is going to improve mar-gins further with in-house clinker production.

With launch of new models in the automobile segment and commencement of Lucky Elec-tric Power Ltd. (LEPL) expected to be major triggers in the medium term, we expect the stock to remain in limelight where our TP of PkR928.5/sh provides an upside of 25.1% with LUCK currently trading at EV/EBITDA of 6.3x (Ex. Portfolio value) against 7.4x of our uni-verse.

Pakistan Economy: Fiscal math on the mend, (AKD Daily, Feb 09, 2021)

As per the official numbers released by Ministry of Finance (MoF), Pakistan's fiscal deficit clocked in at 2.5% of GDP in 1HFY21, marginally higher than last year (2.4% of GDP). More importantly, primary surplus stood at 0.74% of GDP (PkR337.2bn), showcasing improvement from last year's 0.69% of GDP (PkR286.4bn).

The increase in primary surplus was the product of, i) 5.6%YoY growth in FBR taxes which reached to PkR2.21trn, ii) 2.0x increase in collection under petroleum levy as Govt did not fully pass on the benefit of lower oil prices and higher MS/HSD (+8/13%YoY), iii) 8.5% reduc-tion in defence spending, and iv) lower PSDP releases (35.7% of budgeted amount vs. 39.4% in the previous year).

While fiscal performance has remained satisfactory, providing confidence in Govt.’s ability to achieve revenue collection target of PkR4.96trn, yet it would end up with primary/fiscal deficits of 0.5%/7.0% of GDP, indicating that the path to fiscal consolidation will be tough and tedious.

From market’s vantage, Cements and Steel are likely to be the primary beneficiary of im-proved fiscal performance gaining from possibly higher PSDP releases in the near term.

HBL: CY20 Result Previews, (AKD Daily, Feb 08, 2021)

HBL – CY20 EPS estimated at PkR22.6/sh: We expect Habib Bank Limited (HBL) to show-case earnings of PkR33.4bn (EPS: PkR22.6) for CY20 vis-à-vis PkR15.5bn (EPS: PkR10.4) in CY19. Together with the results, we expect the bank to announce dividend of PkR4.75/sh (c. PkR6.0/sh) while upside cannot be ruled out given bank’s CET-1 capital standing at 12.88%. For 4QCY20, we expect earnings to clock in at PkR5.4/sh, down 19.3%QoQ while +22.0%YoY. Sequential decline in earnings is attributable to 87bps contraction in NIMs due to normaliza-tion in yields particularly of floating rate bonds and treasury bills. To highlight unrealized gains on PIBs and treasury bills, categorized as AFS, declined sequentially by 33.7% and 61.1% respectively, in 3QCY20. However, the decline in net interest income (down 12.8%QoQ) is partially offset by 30.5%QoQ growth in non funded income primarily led by season-ally higher fee income and potential capital gains (c. unrealized gain on investments stood at PkR19.2bn as of Sep’20). We expect the bank to continue boosting its loss reserves in case of potential credit risks and as such cost of provisioning is assumed at 0.24% for 4QCY20, marginally lower than in the previous quarter. We have a buy stance on HBL with a Dec’21TP of PkR174.6/sh.

AKD Securities Limited

12 February 2021

StockSmart

Pakistan Weekly Update

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

SPOT Units 12-Feb-21 4-Feb-21 WoW FYTD

TRJ-CRB Points 183.6459 180.2439 1.89% 33.10%

Nymex (WTI) US$/bbl. 57.83 56.23 2.85% 47.26%

ICE Brent US$/bbl. 60.69 58.76 3.28% 48.42%

N. Gas Henry Hub US$/Mmbtu 6.92 2.956 134.10% 304.21%

Cotton USd/Pound 91.25 87.7 4.05% 34.29%

Gold US$/Tr.Oz 1817.25 1794.03 1.29% 2.04%

Sliver US$/Tr.Oz 27.0806 26.3516 2.77% 48.74%

Copper US$/MT 8289.25 7825.5 5.93% 38.05%

Platinum US$/Oz 1222.21 1101.45 10.96% 47.36%

Coal US$/MT 88.65 85 4.29% 62.07%

SPOT 12-Feb-21 4-Feb-21 Chg +/- WoW FYTD

Dollar Index 90.601 91.529 -0.928 -1.01% -6.97%

USD/PkR 158.799 159.987 -1.188 -0.74% -5.42%

USD/JPY 105.040 105.540 -0.500 -0.47% -2.68%

EUR/USD 1.211 1.196 0.014 1.20% 7.77%

GBP/USD 1.379 1.367 0.012 0.86% 11.19%

AUD/USD 0.773 0.760 0.013 1.67% 11.94%

NZD/USD 0.719 0.716 0.003 0.48% 11.40%

CHF/USD 0.893 0.904 -0.012 -1.28% -5.77%

CAD/USD 1.274 1.283 -0.008 -0.66% -6.14%

USD/KRW 1,107 1,119 -11.700 -1.05% -7.98%

CNY/USD 6.458 6.472 -0.013 -0.21% -8.57%

Country Bloomberg Code 12-Feb-21 4-Feb-21 WoW FYTD

Pakistan KSE100 Index 45,808 46,906 -2.34% 33.1%

Srilanka CSEALL Index 7,985 8,245 -3.15% 55.1%

Thailand SET Index 1,508 1,483 1.71% 12.6%

Indonesia JCI Index 6,223 6,107 1.89% 26.9%

Malaysia FBMKLCI Index 1,599 1,585 0.92% 6.6%

Philippines PCOMP Index 6,991 6,904 1.26% 12.6%

Vietnam VNINDEX Index 1,115 1,112 0.25% 35.1%

Hong Kong HSI Index 30,174 29,114 3.64% 23.5%

Singapore FSSTI Index 2,925 2,906 0.68% 13.0%

Brazil IBX Index 50,704 50,564 0.28% 26.1%

India SENSEX Index 51,544 50,614 1.84% 47.6%

China SHCOMP Index 3,655 3,502 4.38% 22.5%

S&P SPX Index 3,916 3,872 1.15% 26.3%

DJIA INDU Index 31,431 31,056 1.21% 21.8%

NASDAQ Composite CCMP Index 14,026 13,778 1.80% 39.4%

UK UKX Index 6,540 6,504 0.56% 6.0%

Germany DAX Index 13,981 14,060 -0.56% 13.6%

Qatar DSM Index 10,523 10,431 0.88% 16.9%

Abu Dhabi ADSMI Index 5,667 5,664 0.05% 32.2%

Dubai DFMGI Index 2,633 2,671 -1.40% 27.5%

Kuwait KWSEIDX Index 6,633 6,633 0.00% 0.0%

Oman MSM30 Index 3,560 3,606 -1.29% 1.2%

Saudi Arabia SASEIDX Index 8,944 8,618 3.78% 23.8%

MSCI EM MXEF Index 1,428 1,388 2.90% 43.5%

MSCI FM MXFM Index 583 583 -0.08% 21.4%

100

110

120

130

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150

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5

AKD Securities Limited

12 February 2021

StockSmart

Pakistan Weekly Update

Chart Bank

FIPI Flows for the week

Advance to Decline Ratio

AKD Universe vs. KSE-100 Index

LIPI Flows for the week

Average PIB and E/Y differential

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

-40%

-30%

-20%

-10%

0%

10%

20%

30%

40%

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b-2

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KSE100 MSCI EM MSCI FM

(1,365)

(1,678)(1,847)

144

1,591

(2,500)

(2,000)

(1,500)

(1,000)

(500)

-

500

1,000

1,500

2,000

8-Feb-21 9-Feb-21 10-Feb-21 11-Feb-21 12-Feb-21

(US$'000)

Ind., 14.15

Co., 7.83

Bank/DFI, 1.06

NBFC, (0.07)

M.Funds,

0.10

Ins , (8.07)

Others , (6.63)

Prop. Trading , (2.13)

(10.00)

(5.00)

-

5.00

10.00

15.00

20.00

0.60

0.90

1.20

1.50

1.80

2.10

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Feb-

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Aug

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Feb-

21

KSE-All Share Index AKD Universe

5.0%

7.0%

9.0%

11.0%

13.0%

15.0%

17.0%

19.0%

21.0%

23.0%

25.0%

Fe

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Jun-2

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Aug

-20

Sep

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Oct-

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1

Fe

b-2

1

Earning Yield PIB Yield

6

AKD Securities Limited StockSmart

Pakistan Weekly Update

Market PER Chart 2021

12 February 2021

AKD Universe Valuations

Source: AKD Research

Market P/BVS Chart 2021

Source: AKD Research

Jan

-08

Ap

r-0

9

Au

g-1

0

De

c-1

1

Mar

-13

Jul-

14

No

v-1

5

Mar

-17

Jun

-18

Oct

-19

Feb

-21

7.6

6.3

4.9

3.5

(x)

Jan-

08

Ap

r-09

Au

g-10

Dec

-11

Mar

-13

Jul-1

4

No

v-15

Mar

-17

Jun-

18

Oct

-19

Feb

-21

1.9

1.5

1.0

0.5

(x)

4-Feb-21 2017 2018 2019 2020F 2021F

EPS chg (%) (15.24) 11.08 18.79 19.17 (0.76)

EPS chg (%) ex-E&P (24.94) 6.38 (0.50) 18.20 15.02

Book Value per Share (PkR) 41.64 44.35 49.14 53.38 57.53

Payout (%) 55.32 49.54 42.51 29.11 44.06

Valuations

Price to Earnings (x) 9.89 8.96 7.98 6.91 6.97

PER (Ex-Banks & E&Ps) (x) 10.55 9.73 10.74 10.00 9.59

Price to Book (x) 1.35 1.28 1.16 1.41 1.29

Price to CF (x) 13.65 10.07 13.85 11.15 6.96

Earnings Yield (%) 10.11 11.17 12.53 14.46 14.35

Dividend Yield (%) 6.18 5.71 5.76 5.58 7.03

EV / EBITDA (x) 6.65 6.60 5.73 4.83 4.92

Profitability

Return on Equity (%) 13.79 14.38 15.42 18.40 17.70

Return on Assets (%) 2.25 2.28 2.45 2.09 2.04

Chg in Sales (%) 16.05 17.88 21.76 (1.39) (4.05)

Gross Margin (%) 35.96 35.12 34.06 34.08 36.41

Operating Margin (%) 24.85 24.38 24.00 23.06 24.42

Net Margin (%) 11.24 10.59 10.34 9.64 10.64

7

AKD Securities Limited StockSmart

Pakistan Weekly Update

AKD Universe Active Coverage Cluster’s Valuations

12 February 2021

UR Under Review Source: AKD Research

Stocks Symbol Price TP Stance

(PkR) (PkR) 19 20A/F 21F 19 20A/F 21F 19 20A/F 21F 19 20A/F 21F

Automobile and Parts

Indus Motors INDU 1,157.3 1,500.0 Buy 174.5 64.7 106.3 6.6 17.9 10.9 2.3 2.2 2.0 9.5 2.6 5.2

Pak Suzuki Motors PSMC 275.3 180.0 Sell (35.4) (24.0) (1.6) n.a n.a n.a 0.9 1.0 1.0 - - -

Cements

DG Khan Cement DGKC 131.1 125.0 Sell 3.7 (4.9) 3.8 35.7 n.a 34.1 0.8 0.9 0.8 0.8 - 0.6

Lucky Cement LUCK 789.8 928.5 Buy 32.4 10.3 28.6 24.3 76.4 27.7 2.7 2.6 2.4 0.8 - 0.8

Maple Leaf Cement Factory MLCF 45.2 57.4 Buy 1.3 (4.4) 2.1 33.9 n.a 21.4 1.6 1.6 1.5 - - -

Fauji Cement Company Ltd. FCCL 26.1 26.4 Sell 2.0 (0.04) 1.6 12.8 n.a 16.3 1.7 1.8 1.8 5.2 - 4.9

Pioneer Cement Limited PIOC 139.8 81.0 Sell 3.5 (0.9) 2.1 40.2 n.a 67.9 2.4 2.4 2.3 - - -

Cherat Cement Co Limited CHCC 182.9 108.0 Sell 9.1 (9.7) 7.1 20.2 n.a 25.7 3.0 3.5 3.1 0.5 - 0.8

Engineering

Amreli Steels Ltd. ASTL 46.79 58.0 Buy 0.1 (3.8) 2.7 423.4 n.a 17.1 1.1 1.3 1.2 - - -

Fertilizers

Engro Corporation ENGRO 301.7 320.0 Buy 28.7 37.9 46.6 10.5 8.0 6.5 0.9 0.8 0.7 8.0 9.9 9.9

Engro Fertilizers Limited EFERT 63.2 59.0 Sell 12.6 11.4 8.9 5.0 5.6 7.1 1.9 1.9 1.9 20.6 17.4 12.7

Fauji Fert. Bin Qasim Ltd. FFBL 26.2 25.7 Sell (6.3) 1.7 3.3 n.a 15.4 7.9 3.6 1.8 1.4 - - -

Fauji Fertilizer Company FFC 108.4 131.0 Buy 13.4 16.4 16.1 8.1 6.6 6.7 3.9 3.5 3.1 10.0 11.1 11.1

Fatima Fertilizer FATIMA 28.6 39.0 Buy 5.8 6.0 6.0 5.0 4.7 4.8 0.8 0.7 0.7 7.4 8.2 6.5

Oil & Gas

Oil & Gas Development Co. OGDC 108.6 185.0 Buy 27.5 23.3 22.1 3.9 4.7 4.9 0.7 0.7 0.6 10.1 6.7 6.9

Pak Oilfields POL 400.5 406.0 Neutral 57.1 56.7 56.7 7.0 7.1 7.1 3.0 2.8 2.7 12.5 12.5 12.2

Pakistan Petroleum PPL 90.2 155.0 Buy 21.9 18.2 18.7 4.1 5.0 4.8 0.8 0.7 0.6 - - 4.4

Hascol Petroleum HASCOL 11.1 UR UR - - - - - - - - - - - -

Attock Petroleum APL 345.9 434.3 Buy 39.8 10.1 37.9 8.7 34.1 9.1 1.8 1.9 1.6 5.8 2.6 7.7

Pakistan State Oil PSO 249.0 293.1 Buy 22.5 (13.8) 30.8 11.0 n.a 8.1 1.0 1.0 0.9 4.0 - 5.0

Power

Hub Power Co. HUBC 88.3 168.0 Buy 9.4 20.1 21.0 9.4 4.4 4.2 2.0 1.4 1.1 11.3 - 8.4

K-Electric Co. KEL 4.3 UR UR - - - - - - - - - - - -

Kot Addu Power Company KAPCO 40.1 UR UR - - - - - - - - - - - -

Cable & Electrical Goods

Pak Electron Ltd PAEL 39.9 48.1 Buy 1.8 0.1 2.7 22.6 443.8 14.5 0.5 0.5 0.5 - - 3.0

Personal Goods

Nishat Mills NML 116.9 132.0 Buy 16.7 10.0 11.0 7.0 11.7 10.6 0.6 0.6 0.6 3.4 3.4 2.8

Nishat Chunian Ltd. NCL 49.6 55.7 Buy 13.2 1.1 7.1 3.8 44.9 7.0 0.8 0.7 0.7 5.0 2.0 5.5

Banks

Allied Bank Limited ABL 83.6 109.8 Buy 12.7 15.1 11.7 6.6 5.5 7.2 0.8 0.8 0.7 9.6 10.8 10.8

Bank Al Habib BAHL 72.6 91.5 Buy 10.1 16.2 14.3 7.2 4.5 5.1 1.3 1.0 0.9 4.8 6.2 8.3

Bank AlFalah BAFL 34.1 51.9 Buy 7.3 6.1 7.1 4.6 5.6 4.8 0.7 0.6 0.6 11.7 11.7 11.7

Habib Bank Limited HBL 133.5 174.6 Buy 10.6 23.0 24.7 12.6 5.8 5.4 0.9 0.7 0.7 3.7 4.5 6.0

Habib Metropolitn Bank HMB 36.5 46.1 Buy 6.6 11.0 8.9 5.5 3.3 4.1 0.8 0.6 0.5 6.1 9.6 9.6

MCB Bank Limited MCB 184.5 223.4 Buy 20.2 24.9 24.6 9.1 7.4 7.5 1.3 1.2 1.2 9.2 10.8 10.8

Meezan Bank Limited MEBL 109.8 137.0 Buy 12.3 17.7 16.6 8.9 6.2 6.6 2.2 1.9 1.7 3.3 7.3 7.3

National Bank of Pakistan NBP 40.0 50.4 Buy 7.8 16.8 13.4 5.1 2.4 3.0 0.4 0.3 0.3 - - -

United Bank Ltd UBL 129.4 142.5 Buy 15.6 16.5 18.4 8.3 7.8 7.0 0.8 0.8 0.7 9.3 9.3 9.3

Bank of Punjab BOP 9.0 13.9 Buy 3.2 2.8 1.6 2.8 3.2 5.6 0.5 0.5 0.4 8.3 8.3 8.3

EPS P/E P/B DY(%)

8

AKD Securities Limited

12 February 2021

StockSmart

Pakistan Weekly Update

AKD Universe Coverage Cluster’s Performance

Source: PSX & AKD Research

Stocks Symbol Price 1 Year 1 Year

12-Feb-21 1M 3M 6M 12M FYTD High Low

KSE-100 Index 45,808.36 -0.2 12.9 13.2 13.0 33.1 46,933.6 27,228.8

Automobile and Parts

Indus Motors INDU 1,157.25 -3.7 -2.0 -13.7 13.2 16.3 1429.98 700.38

Pak Suzuki Motors PSMC 275.28 20.1 37.3 11.3 24.0 70.1 280.44 124.21

Cements

DG Khan Cement DGKC 131.10 16.7 24.2 24.0 96.8 53.6 131.10 50.05

Lucky Cement LUCK 789.82 12.7 20.3 29.3 60.4 71.1 789.82 310.30

Maple Leaf Cement MLCF 45.21 4.2 13.1 29.1 93.4 74.0 46.17 16.74

Fauji Cement Company FCCL 26.13 23.9 26.5 26.4 65.9 54.8 26.13 11.68

Pioneer Cement Limited PIOC 139.75 35.1 58.6 57.4 396.3 121.7 139.75 22.81

Cherat Cement Limited CHCC 182.86 30.1 40.5 43.1 247.4 109.8 183.14 45.52

Engineering

Amrel i Steel Ltd ASTL 46.79 -1.6 17.5 -6.4 41.4 43.4 53.46 21.28

Fertilizers

Engro Ferti l i zers Ltd. EFERT 63.15 -5.5 -5.7 -6.8 -5.3 4.8 68.45 50.72

Engro Chemica l ENGRO 301.65 -5.0 -1.2 -3.7 -10.8 3.0 337.99 237.65

Fatima Ferti l i zer FATIMA 28.55 -1.6 3.0 4.8 12.3 6.8 31.88 20.82

Fauji Fert. Bin Qas im Ltd. FFBL 26.20 -0.5 20.9 20.3 42.5 64.2 28.78 11.79

Fauji Ferti l i zer Company FFC 108.42 -3.0 3.5 -5.3 2.8 -1.4 114.54 82.71

Cable & Electrical Goods

Pak Elektron Limited PAEL 39.91 -4.3 20.2 16.8 66.6 74.1 42.38 16.62

Oil & Gas

Oi l & Gas Development OGDC 108.55 -6.2 10.1 -5.6 -17.4 -0.4 131.48 75.01

Pak Oi l fields POL 400.51 -6.7 8.8 -2.1 -3.1 14.2 437.08 241.11

Pakis tan Petroleum Ltd. PPL 90.17 -9.0 2.3 -12.1 -32.2 3.9 132.99 69.13

Pakis tan State Oi l PSO 248.96 4.6 25.8 34.6 28.4 57.4 259.32 113.98

Attock Petroleum Ltd. APL 345.93 0.7 7.5 1.8 1.6 13.3 385.00 211.87

Hascol Petroleum HASCOL 11.08 -25.7 -23.9 -28.6 -52.7 -18.5 23.42 10.65

Power

Hub Power Co. HUBC 88.30 3.6 10.6 -0.5 -11.5 21.8 99.81 57.40

K-Electric Limited KEL 4.25 -5.6 19.7 11.0 1.4 41.2 4.67 2.65

Kot Addu Power Company KAPCO 40.10 7.0 43.9 41.1 50.5 99.0 44.66 15.00

Personal Goods

Nisaht (Chunian) Ltd. NCL 49.57 3.2 37.7 23.9 7.7 52.8 53.01 23.78

Nishat Mi l l s NML 116.92 2.4 30.0 16.6 8.7 49.9 117.12 54.07

Banks

Al l ied Bank Limited ABL 83.63 -5.0 -1.6 -1.6 -12.9 9.2 96.00 66.82

Bank AlHabib Limited BAHL 72.62 -4.9 5.2 14.5 -6.9 37.8 79.66 50.98

Bank AlFa lah BAFL 34.05 -6.9 -3.4 -11.7 -31.1 1.4 49.66 28.79

Habib Bank Limited HBL 133.49 -6.0 2.5 3.3 -14.8 37.8 166.29 94.78

Bank of Punjab BOP 9.01 -8.3 -0.7 -10.9 -31.4 7.3 13.13 7.01

Habib Metropol i tan Bank HMB 36.47 -7.5 -2.1 6.3 -9.2 31.1 40.67 27.30

MCB Bank Limited MCB 184.49 -6.5 6.7 1.8 -11.4 13.8 210.19 132.89

Meezan Bank Limited MEBL 109.79 -3.5 22.3 29.0 11.0 59.5 115.14 55.66

National Bank of NBP 39.99 -6.0 3.7 12.3 -8.5 44.6 43.80 25.53

United Bank Ltd UBL 129.35 -8.4 13.7 6.7 -23.4 25.1 174.22 89.44

Absolute Performance (%)

9

AKD Securities Limited

12 February 2021

StockSmart

Pakistan Weekly Update

Economic Snapshot

Source: SBP, PBS & AKD Research

End Month Data Units Dec-20 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-20 Sep-20 Oct-20 Nov-20 Dec-20

Monetary Rates

T-Bills - 3M % 13.4 13.5 13.4 13.1 n.a n.a n.a n.a n.a n.a n.a n.a n.a

T-Bills - 6M % 13.5 13.5 13.5 13.2 n.a n.a n.a n.a n.a n.a n.a n.a n.a

T-Bills - 12M % 13.6 13.2 13.6 13.3 n.a n.a n.a n.a n.a n.a n.a n.a n.a

PIB 10Y % 11.1 11.0 11.2 10.2 8.5 8.3 8.6 8.8 9.4 9.6 10.0 9.9 10.0

KIBOR 6M % 13.5 11.2 13.2 12.3 12.1 7.8 7.6 6.8 7.2 7.3 7.1 7.1 7.1

Discount rate % 13.8 13.8 13.8 12.0 10.0 9.0 8.0 8.0 8.0 8.0 8.0 8.0 8.0

Policy rate % 13.3 13.3 13.3 11.0 9.0 8.0 7.0 7.0 7.0 7.0 7.0 7.0 7.0

Inflation

National CPI Inflation % 12.6 14.6 12 10.2 8.5 8.2 8.6 9.3 8.2 9.0 8.9 8.3 8.0

Core inflation (Urban) % 7.5 7.9 8 7.4 7.7 7.3 7.6 7.8 7.1 7.7 7.3 7.0 7.0

Core inflation (Rural) % 8.1 9 9.4 9.4 9.8 9.7 10 11.5 9.9 11.1 11.3 10.5 9.5

Food inflation (Urban) % 16.7 19.5 15.2 13 10.4 10.6 12.9 15.1 11.3 12.4 13.9 13.0 12.6

Food inflation (Rural) % 19.7 23.8 19.7 15.5 12.9 13.7 15.2 17.8 13.5 15.8 17.7 16.1 13.4

External Indicators

Export (PBS) US$(mn) 1,993 1,970 2,140 1,814 957 1,396 1,599 2,001 1,584 1,889 2,081 2,171 2,366

Import (PBS) US$(mn) 4,037 4,037 4,185 3,316 3,088 2,863 3,719 3,687 3,324 4,321 3,820 4,229 5,005

Trade Deficit (PBS) US$(mn) -2,044 -2,067 -2,045 -1,502 -2,131 -1,467 -2,120 -1,686 -1,740 -2,432 -1,739 -2,121 -2,639

Export (SBP) 2,108 2,053 1,993 1,820 1,407 1,259 1,582 1,897 1,510 1,956 1,960 2,227 n.a

Import (SBP) 3,791 3,912 3,563 3,321 3,140 2,800 3,559 3,555 3,237 3,822 3,472 4,077 n.a

Trade Deficit (SBP) (1,683) (1,859) (1,570) (1,501) (1,733) (1,541) (1,977) (1,658) (1,727) (1,866) (1,512) (1,850) n.a

Home Remittances US$(mn) 2,097 1,907 1,825 1,894 1,790 1,873 2,466 2,768 2,095 2,284 2,284 2,339 2,437

Current Account US$(mn) -367 -534 -210 -9 -530 344 -96 508 211 73 415 447 n.a

Banking Sector

Deposits PkR(bn) 14,632 14,673 14,815 15,126 14,476 15,481 16,229 16,122 16,327 16,886 16,664 16,841 17,876

Advances PkR(bn) 8,158 8,164 8,212 8,259 8,217 8,357 8,202 8,120 8,053 8,094 8,116 8,166 8,497

Investments PkR(bn) 8,801 8,366 8,725 9,297 9,794 10,382 10,681 10,809 10,869 11,090 10,942 11,071 11,552

W. A. lending rate % 12.73 13.35 13.23 13.01 11.18 10.75 10.08 8.94 8.72 8.26 9.09 8.83 n.a

W. A. deposit rate % 6.65 6.95 7 6.91 6 5.11 4.31 3.94 3.84 3.77 3.74 3.64 n.a

Spread rate % 6.08 6.40 6.23 6.10 5.18 5.64 5.77 5.00 4.88 4.49 5.35 5.19 n.a

Public Finance

Tax collection PkR(bn) 476.7 318.1 326.3 322 243 229.3 464 n.a n.a n.a n.a n.a n.a

Direct taxes PkR(bn) 227.4 112.6 107.7 137.1 82.7 84.7 213.4 n.a n.a n.a n.a n.a n.a

Indirect Taxes PkR(bn) 249.3 205.5 218.5 184.9 160.2 144.6 250.6 n.a n.a n.a n.a n.a n.a

Currency

Fx Reserves US$(mn) 17,930 18,645 18,881 17,098 18,755 16,943 18,886 19,599 19,908 19,385 19,399 20,267 n.a

USDPkR - Interbank PkR/USD 155.01 154.74 154.34 159.02 164.43 160.58 165.53 166.87 167.95 166.02 162.82 159.37 160.28

10

AKD Securities Limited StockSmart

Pakistan Weekly Update

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AKD Research Team

Analyst Tel no. E-mail Coverage

Usman Zahid +92 111 253 111 (693) usman.zahid@akdsecurities.net Executive Director Research

Ali Asghar Poonawala +92 111 253 111 (646) ali.poonawala@akdsecurities.net E&Ps, Cable & Electrical & Automobiles

Hamza Kamal +92 111 253 111 (634) Hamza.kamal@akdsecurities.net Commercial Banks, Economy

Shahrukh Saleem +92 111 253 111 (685) shahrukh.saleem@akdsecurities.net Cement & OMCs Sector

AIlia Naeem +92 111 253 111 (603) ailia.naeem@akdsecurities.net Fertilizer & Power Sector

Qasim Anwar +92 111 253 111 (680) qasim.anwar@akdsecurities.net Technical Analysis

Nasir Khan +92 111 253 111 (639) nasir.khan@akdsecurities.net Research Production

Faisal Tufail +92 111 253 111 (647) faisal.tufail@akdsecurities.net Research Production

Tariq Mehmood +92 111 253 111 (643) tariq.mehmood@akdsecurities.net Library Operations

12 February 2021

New Rating Definitions

Buy > 14.5% expected total return (Rf: 8.5% + Rp: 6%)

Neutral > 8.5% to < 14.5% expected total return

Sell < 8.5% expected total return (Rf: 8.5%)