Karachi Stock Exchange Weekly Analysis 29 Dec, 2013

The Karachi Stock Exchange (KSE) market has taken some correction amidst lackluster activity at year-end. KSE - 100 index closed at 25,258.05 points by losing -321.28 points or -1.26 percent, while average daily traded volumes increased by 27%WoW to 268mn shares. KSE - 30 index closed at 18,845.12 points by losing -259.43 or -1.36 percent.

Activity declined sharply from last week levels, with average daily turnover falling to 183mn shares, down 32% WoW, whereas US$ value traded decreased by 33% WoW. The week saw FIPI net inflow of a mere US$0.6mn. Trading activity within the KSE is expected to improve after the holiday season within international markets, as both local and foreign investors re-align portfolios. At the same time, market direction is likely to take cue from continued regulatory developments, particularly the upcoming CPI numbers as well as the announcement of gas prices expected on Jan 1’14. Limited foreign interest, rising political uncertainty, dismal earnings outlook in the telecom sector after new LDI licence and fall in the country’s foreign exchange reserves impacted the sentiment, despite hopes for surge in textile exports on GSP Plus status effective next year and release of the Coalition Support Fund. 

Following news have played vital role in Karachi Stock Market index movement:

  • PTCL submitted a binding offer to Warid Telecom for acquisition of 100% shares
  • A visit by the Turkish PM this week, along with signing of MOU’s is expected to materialize in FDI improvement going forward
  • China National Nuclear Cooperation (CNNC) has reportedly committed US$6.5bn to finance the construction of two nuclear power plants in Karachi with a capacity of 1,100MW each
  • The foreign exchange reserves held b SBP has fallen to US$3.1bn on Thursday compared to US$3.4bn a week earlier. The decline in reserves was mainly due to U$185mn payments including US$162mn for debt servicing (US$58mn to IMF) and US$32mn for other official payments 
  • China Mobile Pakistan- Zong attained the LDI license after reaching an agreement with Pakistan Telecommunications Authority (PTA) and is allowed to provide cost effective and efficient international call and SMS services to its customers. which will take a bite out of Pak Telecom’s (PTC) LDI market share
  • The US Congress has reportedly passed a US$552bn Defense bill for 2014 which stresses to stop reimbursement to Pakistan if Nato supply routes are interrupted
  • Walt Disney Company is reportedly developing a strategy to eliminate Pakistan from the permitted sourcing country list
  • China Exim Bank will disburse funds of US$448mn to Pakistan for the 900MW Neelum-Jhelum Project in Jan’14
  • SBP releasing weak November 2013 Current Account numbers (US$589mn deficit for the month vs. US$96mn deficit last month)
  • The currency strengthened and December 2013 CPI inflation expectations continued to head down on the back of lower food prices, building hope for a benign January 2014 interest rate decision by SBP
  • Pakistan received the 2nd tranche (US$553mn) of the IMF’s EFF program
  • E&P’s too were newsworthy as the country’s oil and gas reserves as of June 30, 2013 were notified, where OGDC and PPL gained while anticipated reserve downgrade materialized for POL 
  • Banks were out of favor (risk of soft CPI + delay in rate hikes) while Cements had a strong run on price hike rumors
  • The calendar year result season is likely to kickoff shortly where numbers of corporate are likely to declare the financial results along with payouts
  • Lower inflation may boost investor confidence where investors may start expecting SBP to keep the discount rate at current levels
  • The prices of petroleum products are likely to be raised from January 01, 2014. Diesel price will likely be increased by PKR4/litre, petrol by PKR2.50/litre and kerosene oil by PKR4/litre. Added that OGRA would send the summary, seeking increase in POL prices to the MoP 
  • NBP has informed the SBP that it cannot invest PKR100bn in the PM Youth Business Loan Scheme as it involved great risk
  • The case of discount rate hike had weakened, as SPI inflation had continuously declined over the last three weeks, while the rupee had appreciated against the greenback
  • Strong December quarterly results expected from EFert, PSO, FFBL, and banks will also garner stock specific interest
  • Banking sector will continue to be on investors’ radar with better spreads in the offing and improved outlook for credit growth, especially in textiles after attaining the GSP Plus status
  • Investors are cautious because of fears for stoppage of US funding if NATO supply routes are interrupted and year-end factor. And also because of terrorist activities during last week
  • Engro Fertilizer’s IPO got over subscribed by 2.4 times and PIBTL got listed on the bourse



Top ten gainers of last week were: Pak Tobacco Co, Cherat Cement, GlaxoSmithKline Pak., ICI Pakistan, Fauji Cement Company, Hum Network Ltd, EFU Life Assur Ltd., J.D.W.Sugar, Allied Rental Mod and TPL Trakker Ltd.

Top ten losers of last week were: Shifa International Hospitals, Azgard Nine, MCB Bank Ltd, P.T.C.L.A, Stand.Chart.Bank, Askari Bank Ltd., JS Bank Ltd, Javedan Corporation, Nestle Pakistan and Packages Limited. 

Top ten volume leaders were: FCCL, PTC, BOP, MLCF, DGKC, NCPL, ANL, JSCL, LPCL and NCL.

Thank you very much for reading this article.

NOTE: The information posted in this blog (forum) is based on current affairs & investors point of view. There may be discrepancy in the ground realities.

Written by: Rana Khurram

Karachi Stock Exchange Weekly Analysis 21 Dec, 2013

The Karachi Stock Exchange (KSE) market was bullish, bulls rule the roast at KSE for the fifth consecutive week. KSE - 100 index closed at 25,579.33 points by gaining 322.63 points or 1.28 percent, while average daily traded volumes increased by 27%WoW to 268mn shares. KSE - 30 index closed at 19,104.55 points by gaining 238.87 or 1.27 percent.

According to experts, CPI expected to remain in double-digits and the GoP’s resolve to contain PkR/USD depreciation, continuation of monetary tightening policy should be expected. There are expectations building up for 50-100bp increase in discount rate in the upcoming Monetary Policy. Investors’ interest was mainly seen in Engro Corporation, Fauji Cement Company Limited, Pakistan Telecommunication Company Limited, Pakistan State Oil and small cap cement stocks.

Following news have played vital role in Karachi Stock Market index movement:


  • PM Nawaz Sharif refused to allow an increase in gas tariffs as proposed by the MoF and instructed additional 85mmcfd gas to be diverted to industries for two months
  • The ECC directed NEPRA to determine the tariff for coal conversion of four IPPs
  • The visiting delegation of Etisilat promised to take up the matter of payment of US$800mn to Pakistan with the BoD while PTC issued a binding offer to acquire a 100% stake in Warid Telecom
  • PTA signed a formal contract with VPCML for 3G auction to be conducted in Feb 2014
  • CAD for 5MFY14 clocked in at US$1.89bn while foreign exchange reserves increased by US$505mn WoW as Pakistan received inflows from multi-lateral institutions
  • The Executive Board of the IMF completed its quarterly review of the EFF program and approved immediate disbursement of about US$550 million
  • The week saw FIPI net outflow of US$4.3 million
  • Ministry of Finance has directed SECP to complete the necessary legal and corporate formalities for the launch of the government's money market instruments, ie, T‐Bills and Pakistan Infrastructure Bonds (PIBs), through the stock exchanges by February 2014 
  • The govt is planning to offload its 12% stake in both United Bank (UBL) and Allied Bank (ABL) through stock market by March/April‐2014
  • Govt allocates 85mmcfd to textile sector exploit the benefit of GSP+ status
  • Lucky cement raises cement prices in Karachi to PRs520/bag (maximum retail price) including PRs76/bag of GST
  • Better offtake of cement in the country along with country wide short fall of the commodity kept investors interest in cement companies
  • Possible improvement in OMC margins as recommended by consultants continued to boost interest in PSO
  • NBP was among the major movers where the stock came close to PKR60/share level, primarily backed by recently announced government schemes and possible privatization
  • Tractor production and sales improved in November 2013 as compared to October 2013 amid reports of a possible 6 per cent hike in GST in January 2014
  • Iran has canceled a planned USD500mn loan to Pakistan to build part of a pipeline to bring natural gas from Iran
  • Appreciation of the Pak rupee (+0.7%WoW) vs. the US dollar


Top ten gainers of last week were: Soneri Bank, Shifa International Hospitals, JS Bank Ltd, Pace (Pak) Ltd., Stand.Chart.Bank, Shell Pakistan, Pak Services, Kohinoor Textile, Faysal Bank and ICI Pakistan.

Top ten losers of last week were: Mari Petroleum, Abbott Lab, Azgard Nine, Nestle Pakistan, Engro Corp, Thal Limited, Adamjee Ins, Bata (Pak) Ltd., Lotte Chemical Pakistan Ltd and Sui North Gas Pipe.

Top ten volume leaders were: FCCL, PTC, FABL, MLCF, JSCL, NBP, BOP, BAFL, NCPL, and DGKC.

Thank you very much for reading this article.

NOTE: The information posted in this blog (forum) is based on current affairs & investors point of view. There may be discrepancy in the ground realities.

Written by: Rana Khurram

Karachi Stock Exchange Weekly Analysis 14 Dec, 2013

The Karachi Stock Exchange (KSE) market was bullish, closing the week above the 25,000 points week for the first time. KSE - 100 index closed at 25,256.70 points by gaining 386.15 points or 1.55 percent, while KSE - 30 index closed at 18,865.68 points by gaining 240.69 or 1.29 percent. It is the first time, in the KSE-100’s 22-year history, that it has crossed 25,000 points. The index has put in a strong performance in 2013 and increased 9,149 points (42.3%) on its way to a record high of 25,256 points at the end of this week.

Volumes picked up significantly during the week as investors continued to exhibit confidence in the market with average daily traded volumes during the week clocking in at 211.2mn shares, up 8.66%WoW. According to analysts, market might continue positive trend next week.

Following news have played vital role in Karachi Stock Market index movement:


  • EU parliament’s decision to grant GSP plus status to Pakistan was well cherished by equities as the benchmark KSE 100 index closed at a new high churning a record 220mn+ shares
  • Top gainers were textile sector companies lagged in the rally leading up to GSP plus award date
  • Most importantly, the status will allow Pakistan to export textiles to the EU free of import duties resulting in a strong rally for the textile sector on Friday
  • The possible provision of concessionary gas rate to Engro’s fertilizer business for its Enven plant
  • 1QFY14 GDP growth clocking in at 5% vs. 2.9% last year boosted investor sentiment at the local bourse
  • SBP's reserves slip below US$3bn
  • Car Sales Shrink by 2% MoM ‐ 5MFY14
  • Motorcycle industry grew 5% in FY14
  • The suspension and subsequent restoration of gas to all consumers excluding CNGs and IPPs
  • Announcement by the government regarding non materialization of the Iran-Pakistan gas pipeline project
  • Approval of US$900mn loan by ADB for coal power generation unit in Jamshoro
  • Fertilizer names Fauji bin Qasim FFBL, Fatima fertilizer and Engro Corp were also in limelight after Finance Minister announced to exempt the fertilizer sector from gas price hike due in January 2014
  • Reports of a possible hike in distribution margin for oil marketing companies kept investor interest alive in Pakistan State Oil
  • FBR will implement the new STR Dec 31, 2013 to do away with existing faulty/defective system, lacking proper physical verification of the declared business premises of the applicants seeking STRN 
  • Shaheen Air plans to enhance its fleet up to 25 aircraft
  • MoP has stated that from January 2014 gas tariff for all consumers excluding domestic consumers will go up
  • Etisalat team will visit Pakistan on December 18, which will keep investors interested in PTCL
  • The IMF meeting is taking place on December 19 in which the release of the next tranche worth $550 million will be decided
  • In dollar terms, the value traded declined by 14.8 percent. The week saw foreign portfolio investment inflows of $6.07 million against $6.2 million last week
  • The market mostly remained positive throughout the week with the exception of Tuesday when selling orders were witnessed on the statement of the US defence secretary for halting the funding if Nato supplies were not allowed from the Pakistani route
  • The star performer of the week was the fertiliser sector as Engro Fertilizer took centre-stage on news that the Ministry of Finance had agreed to supply its new Enven plant with gas from the Mari gas field, at a concessionary rate of 70 cents per mmbtu
  • Engro Fertilizers also announced that it will conduct the Initial Public Offering of the company’s stock in the upcoming week. The news resulted in heavy buying in Engro Corporation’s stock during the week
  • Pakistan’s quarterly gross domestic product (GDP) was recorded at 5.0 percent as against 2.9 percent in the same period last year, this also compared favourably against average 5-year GDP growth of 2.9 percent


Top ten gainers of last week were: Azgard Nine, Mari Petroleum, Engro Foods Ltd, Kohinoor Textile, J.D.W.Sugar, Century Paper, Thal Limited, Pakistan Cables, JS Bank Ltd and Adamjee Ins.

Top ten losers of last week were: Pak Services, Hum Network Ltd, Nestle Pakistan, Tri‐Pack Films Limited, Ghani Glass, Archroma Pakistan, Siemens Pak Engg., IGI Insurance, Nishat Chunian Power and Soneri Bank.

Top ten volume leaders were: JSCL, PTC, ANL, FCCL, DGKC, BAFL, NCPL, ENGRO, NCL and LOTCHEM.

Thank you very much for reading this article.

NOTE: The information posted in this blog (forum) is based on current affairs & investors point of view. There may be discrepancy in the ground realities.

Written by: Rana Khurram

Karachi Stock Exchange Weekly Analysis 8 Dec, 2013

The Karachi Stock Exchange (KSE) market was bullish, foreign flows trump macros to boost. KSE - 100 index closed at 24,870.55 points by gaining 568.36 points or 2.34 percent, while it breached the 25,000 points mark during intraday trading on the last trading day. KSE - 30 index closed at 18,624.99 points by gaining 378.98 or 2.08 percent.

Activity increased from last week levels, with average daily turnover surging to 193.4 million shares, up 45.6% WoW, whereas US$ value traded increased by 47.4% WoW. The week saw FIPI net inflow of US$ 6.2 million. According to experts, market is performing well because of revival of corporate earnings, capital gain taxation amnesty scheme along with its automation, swift change of political regime and attractive valuation in contrast with regional peers.

Following news have played vital role in Karachi Stock Market index movement:

  • Government has approved 28 construction and development projects worth PKR 245 billion
  • ECC held back the decision to announce the gas load management program for winters
  • Some EU countries voted against the GSP Plus status to be clubbed together for beneficiary countries, including Pakistan. Clouds of uncertainty still loom large on Pakistan's Generalized System of Preferences (GSP+) plus status Portugal, Croatia, Bulgaria, Poland, France are amongst the 12 countries who oppose trade concessions to Pakistan
  • The MPNR suggested removal of deemed duty on HSD for refineries
  • Government sought early disbursement of CSF funds from USA amid swiftly deteriorating foreign exchange reserves
  • CPI inflation numbers for November 2013 came in above expected at 10.9% YoY
  • Pak foreign exchange reserves slipped by a further US$557mn during the week to the US$ 8.24 billion mark
  • Media reports suggested that Pakistan is unlikely to receive the much-awaited US$ 800 million on account of PTC privatization from Etisalat
  • The bright spot for the Karachi Stock Exchange proved to be seemingly unremitting foreign portfolio investment inflows (FIPI), where net FIPI flow at the KSE this week clocked in at US$6.0mn (gross inflow of US$51.9mn) vis-a-vis US$8.5mn net FIPI outflow reported last week 
  • November 2013 oil sales up 14% YoY, because of a seasonal pick up in HSD sales owing to the arrival of the Kharif (summer crop) harvesting season and rising demand for Motor Gasoline due to increase in gas load shedding at CNG pumps
  • Preliminary fertilizer offtake figures for November 2013 reveal that Pak urea offtake has clocked in at a whopping 530k tons, +62%YoY and +11%MoM
  • Punjab Food Authority has banned the distribution and sale of Dairy Omung of Engro Foods on account of usage of adulterants to thicken the contents and to give texture of milk 
  • On the political front, PTI government in KP has continued with its NATO supply blockade which has forced US to withdraw supplies through Pakistan’s Torkham border
  • 5MFY14 tax collection stands at PRs806bn against the target of PRs841bn (shortfall of PRs 35 billion)
  • PIA has finalized acquisition (dry‐lease) of 10 fuel‐efficient aircraft that will start reaching Pakistan by April 2014
  • Atlas Honda Limited has planned to invest PKR600mn for the expansion of its motorcycle manufacturing unit
  • Cement dispatches have posted a 6% MoM decline in Nov to 2.6mn tons, mainly on account of 3% MoM drop in domestic demand along with 16% MoM attrition in export volumes, provisional figures show

Top ten gainers of last week were: Bata (Pak) Ltd., Hum Network Ltd, Siemens Pak Engg., Muree Brewery Co Ltd, Tri‐Pack Films Limited, Soneri Bank, Thal Limited, Feroz 1888 Mills Ltd, Century Paper and Pace (Pak) Ltd.

Top ten losers of last week were: Pak Services, Agritech, Attock Cement Ltd, Dawood Hercules Chem, K.E.S.C., Netsol Technologie, Nishat Chunian, Pak.Int.Con., Faysal Bank and EFU Life Assur Ltd.

Top ten volume leaders were: FCCL, PTC, BAFL, ENGRO, MLCF, NBP, JSCL, DGKC and PPL.

Thank you very much for reading this article.

NOTE: The information posted in this blog (forum) is based on current affairs & investors point of view. There may be discrepancy in the ground realities.

Written by: Rana Khurram