STOCK WATCH

 

 

By SHABBIR H. KAZMI
Updated Nov 06, 2004

 

The stock market remained volatile throughout the week. The KSE-100 Index gained almost 20.06 points to close the week at a little above 5352 level. The market witnessed bullish sentiments and initially remained range bound in the following sessions. While some of the analysts forecast for a volatile market, others expect the index to move to and fro from the existing levels with marginal gain or loss during the coming week. The volume leaders for the week were OGDC, Bank of Punjab, PTCL, National Bank and D. G. Khan Cement.

 

 

 

 

SUI SOUTHERN GAS COMPANY

The import of Liquefied Natural Gas is being considered to meet the growing demand of natural gas in the country. With the expected decline in supply and continuous growth in demand, Pakistan has been considering various options to import gas into the country. An interstate gas pipeline is one of the alternatives being considered. However, since an entire pipeline infrastructure would be required to import natural gas, the project is likely to take time. On the other hand LNG transportation is much easier and does not require huge infrastructure. SSGC has announced that it is in negotiations with Iran and Qatar for the import of LNG. The company is planning to import 350-500mmcfd of LNG. However the price is still being negotiated.

PAKISTAN TELECOMMUNICATION COMPANY

According to an official of the company, PTCL expects a 30% decline in international revenues as a result of the upcoming competition. According to some analysts, the competition is still some time away as the private companies are currently in the process of gearing up their Long Distance International (LDI) operations, majority of them are expected to commence operation in year 2005. Therefore, it is believed that PTCL's international revenues do not face serious threat in the current financial year. However, as the competition increases, PTCL would see some decline in its international revenue.

HUBCO

Lack of availability of natural gas has forced the government to shelve proposals for six gas-fired thermal power projects in the country. According to reports, two of these power projects were proposed for Karachi, which included a project submitted by Hubco. Analysts are of the opinion that this will, for the time being, dampen Hubco's expansion plan. However, the link up with KESC has been approved and the company expects this link to be established within the next 12-18 months. Analysts expect the majority of the cash releases in 2006 to be paid out as dividend. For 2005, the expected dividend ranges from Rs 3.20 to Rs 3.50/share. Whereas, the 2006 dividend is likely to be higher as Hubco is likely to pay out all excess cash.

PAKISTAN STATE OIL COMPANY

The largest oil marketing company has announced its first quarter results. It has posted Rs 1,211 million (EPS: Rs 7.06) profit after tax for the period, which represents a 21% YoY jump when compared to the profits for the corresponding period of last year. Oil prices remained on an uptrend throughout the last quarter. Resultantly, margins were also high during the period, which is the single largest factor contributing to the handsome growth in PSO's profit. Domestic petroleum product prices have remained constant since May 2004, as the government has absorbed the impact of rising international oil prices instead of passing it on to end-consumers. The government appears to be firm in its decision to keep domestic petroleum product prices at these levels. While the government is losing revenues from the downstream petroleum sector, higher import duty collection on the import of crude oil and refined petroleum products is likely to compensate for this loss of revenue. According to government officials, the current petroleum prices are based on crude oil prices of US$41/barrel. Analysts do not expect any significant change in prices during the year as crude oil prices are expected to hover around US$40/barrel.

PAK SUZUKI MOTOR COMPANY

The company has announced its third quarter results recently. It has posted a 5% decline in profit to Rs 376 million despite a 37% YoY jump in revenue touching Rs 6,602 million. The company has been facing severe margin pressure on the back of the depreciating rupee, which it has been unable to pass on to end consumers. At the same time, the company's capacity expansion is in process and is expected to be completed by mid next year. The performance reported by Pak Suzuki is similar to the performance being reported by the other auto assemblers, wherein revenues are rising strongly on the back of the easy availability of cheap financing. At the same time political pressures have prevented the assemblers from passing on the impact of the depreciating rupee to end consumers and all the companies are facing major margin pressure, which is likely to continue in the foreseeable future.

 

 

Company High Low Closing

 Week's Turnover

Oil&Gas Dev.XD

66.20

64.85

66.20

77,896,800

B.O.PunjabXB

59.65

52.85

59.65

74,803,500

P.T.C.L.A XD

38.35

37.65

37.75

58,476,500

National Bank

71.40

69.55

71.35

55,674,400

Sui North Gas

51.75

49.25

49.30

31,636,600

Hub PowerXD

29.95

29.35

29.70

22,359,500

Pak PetroleumXD

116.85

114.50

116.75

20,917,100

M.C.B.

48.80

47.15

48.80

18,471,600

Pak OilfieldsXD

198.85

192.00

198.85

13,712,700

Sui South GasXD

23.25

22.10

23.20

7,331,000