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CURRENCY BUYING

SELLING

US Dollar 59.9 60
Bahrain Dinar 158 158.1
Canadian $ 50.85 50.95
Euro 70.75 70.85
Hong Kong $ 7.65 7.7
Japanese Yen 0.508 0.51
Kuwaiti Dinar 204 204.1
UK Pound 103.7 103.8
Last updated: Friday 23 Dec, 2005-12.30 P.M (PST)

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3 DAYS FORECAST
In oC

CITIES MIN MAX

HUM%

FOR.

KARACHI
Today 12 26 38 Sunny
Tomorrow 11 27 38 Sunny
Day after 11 28 38 Sunny
LAHORE
Today 1 20 87 Sunny
Tomorrow 2 20 87 Sunny
Day after 2 21 87 Sunny
ISLAMABAD
Today 0 18 59 Sunny
Tomorrow 0 18 59 Sunny
Day after 0 21 59 Sunny
HUM%: Humidity In %
FOR.: Weather Forecast
updated: Fri - Sun 23-25 Dec, 2005

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.

 

KARACHI         - 021 LAHORE          - 042 ISLAMABAD    - 051 FAISALABAD   - 041 MULTAN          - 061 PESHAWAR    - 0521 CANADA          - 1 KUWAIT           - 965 INDIA               - 91 IRAN                - 98 U.K                   - 44 U.A.E                - 971 U.S.A                - 1

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  CAPITAL MARKETS
 
 

 

 

 

 
  STOCK MARKET AT A GLANCE

By SHABBIR H. KAZMI
Updated Oct 29, 2005

MARKET THIS WEEK

The market remained volatile during the week (which had only 4 trading sessions). Things started on a positive note on Monday indicating that the correction phase was perhaps over. However, the market shed 173.5 index points (combined) on Tuesday and Wednesday. Considerable panic was seen among investors and dry volumes depicted that many were keeping to the sidelines. A recovery was witnessed on Thursday as the market gained 84.17 points to close at 8,319.29. The unresolved PTCL-Etisalat issue has weakened investor confidence and rumors regarding the issue fueled market activity. Furthermore, the settlement of future contracts kept volumes dry.

OUTLOOK FOR THE FUTURE

The unresolved PTCL issue is going to dictate the market sentiment. With Eid holidays around the corner and only a few trading sessions remaining, we believe that market activity would be limited and the market could remain under pressure. However, a major positive development on the PTCL issue could provide a much-needed boost to the market sentiment. Under this cloud of uncertainty, we advise our investors to go long in fundamentally strong scrips. We recommend a buy on Azgard Nine, Chenab Ltd, Fauji Bin Qasim, KAPCO, ICI Pakistan, Nishat Chunian, Nishat Mills, Packages, and POL.

FUNDAMENTAL CHANGES

The major developments this week were:

•Sui Southern Gas Company (SSGC) posted after tax earnings of PRs342mn (EPS: PRs0.51) for 1Q06, 2% higher YoY.

•Pakistan Oilfields Limited (POL) announced 1QFY06 results posting earnings after tax of PRs1,441mn (EPS PRs10.96) and as expected, POL did not announce any cash or stock dividend.

•Lucky Cement Line 'C' (4200tpd) has begun commercial production from this month, which was initially expected to commence operations from Aug-05. With this addition, Lucky's production capacity would be increased to 2.7mn tons of clinker from 1.44mn tons.

•Callmate Telips Telecom Limited announced 1QFY06 results on Friday posting profits after tax of PRs221.95mn (EPS: PRs4.02).

•Urea offtake reported 14% YoY growth in 9M05 (3% YoY in 3Q05; 11% YoY in Sept-05) while DAP sales registered 21% YoY growth (-7% YoY drop in 3Q05; 13% YoY Sept-05).

•Shell Pakistan posted earnings after tax of PRs982mn(EPS PRs22.40) as compared to PRs651mn (EPS: PRs14.85) posted last year, depicting a growth of 51% YoY.

•Nestle Pakistan posted after tax earnings of PRs845mn (EPS: PRs18.65), 10% YoY higher. ???Cherat Cement announced its 1QFY06 results. Net earnings were up by 54% YoY to PRs232mn (EPS: PRs2.79), which is well above market expectations.

•On the back of attractive valuations, the Karachi stock market attracted an impressive US$144.9mn in 1QFY06 (compared to US$20mn in 1QFY05). On the other hand, total Foreign Direct Investment (FDI) was recorded at US$328.7mn (from US$181.1mn in 1QFY05).

•Maintaining its tradition of high payouts and bonus dividends, Fauji Fertilizer (FFC) declared PRs3.25/share cash and 10% bonus dividend along with its 9M05 results. Net profits for 9M05 were up by 13% YoY to PRs3.49bn (EPS: PRs7.78), which is 6% higher than our expectations.

•Packages posted net profit of PRs639mn (EPS: PRs9.14) for 9M05, 18% higher YoY.

•Nishat Mills Ltd. (NML) announced results for the 1QFY06 yesterday. The company posted after tax earnings of PRs320mn (EPS: PRs2.2).

•Indus Motor Company reported 1Q06 posting earnings after tax of PRs466mn (EPS: PRs5.93) as against PRs368mn (EPS: PRs4.69), 27% higher YoY and 3% lower than our expectations.

•ICI Pakistan announced its 9M05 results, posting earnings after tax of 1,160mn (EPS: PRs8.36) up by 77% YoY (one time gain on sale of PTA excluded) and 8% higher than our expectations.

THIS WEEK'S TOP STORIES

NESTLE & UNILEVER - 9M05 RESULTS PREVIEW

Nestle Pakistan is scheduled to announce its 9M05 results on Tuesday, 25-Oct-05. We expect Nestle to post after tax earnings of PRs886mn (EPS: PRs19.56), 15% higher YoY. Nestle Pakistan will be a direct beneficiary of additional demand for packed products (Milk and Water) arising after the earthquake. We recommend Buy for Nestle with a price objective of PRs685/share.

Unilever Pakistan is due to announce its 9M05 results on Wednesday, 26-Oct-05. We expect Unilever to post net earnings of PRs1.38bn (EPS: PRs104.16), 17% YoY drop. The decline in earnings is attributable to capital gains booked last year. Going forward we expect Household & Personal Care (HPC) segment to recover and outperform other segments with the removal of excise duty on soaps and detergents. We recommend a Neutral stance for Unilever with a fair value of PRs1,699/share.

PTCL & FFC RESULT PREVIEW

PTCL is to announce 1QFY06 results on Thursday. We expect PTCL to post profit after tax of PRs4,760mn (EPS: PRs0.93), 24% lower YoY. Dividend speculations will again be rife and since privatization issues are still unresolved, one could possibly see an interesting situation where only minority shareholders are entitled to a dividend of around PRs3.0-3.5/share. Regarding transfer of management to Etisalat, we firmly believe the transaction will eventually come through. However, we feel that Etisalat should not delay the takeover much longer as it is hurting its own prospects by allowing niche competitors an open ground during the intermediate period.

NML & DGKC 1QFY06 RESULT PREVIEW

NML is to announce 1QFY06 results today where we expect after tax earnings of PRs392mn (EPS: PRs2.70) 31% higher YoY, driven by 8% top line growth and 457bp improvement in gross margins. At 8x FY06E earnings, we recommend a Buy for Nishat Mills, which trades at a 56% discount to our Sum of Parts P.O of PRs141.7/sh.

DG Khan Cement (DGKC) is scheduled to announce its 1QFY06 results tomorrow 27-Oct-2005. We expect DGKC to report after tax earnings of PRs421mn (EPS: PRs2.28), 49% higher YoY. We are expecting 200bps imrpovement in gross margins. At current levels, we recommend SELL for DGKC with a revised fair value of PRs62/share.

MCB & NBP - 3Q05 RESULT PREVIEW

MCB's board meeting is scheduled to be held on Friday, 28-Oct-05. We expect the bank to post net profit of PRs5,407mn (EPS: PRs12.68) for 9M05, 123% higher YoY. Like all banks, MCB has been a beneficiary of rising spreads. However, the bank has coupled this with an expanding loan book, which is yielding strong profitability growth for the bank. Trading at 2.9x CY05 Book Value, valuations are demanding. We recommend a Neutral stance on MCB.

NBP is scheduled to meet on Saturday, 29-Oct-05 to approve and announce 9M05 results. We expect NBP to post after tax profits of PRs8,377mn (EPS: PRs14.18). The upcoming results will also incorporate the impact of dividend income from National Investment Trust, which will add PRs1,188mn (PRs2.01/share) to NBP's earnings. This will boost non-interest income of the bank to PRs6,605mn, 12% higher YoY. Trading at 1.7x CY05 Book Value, NBP's valuations are relatively attractive.

MARKET ROUNDUP

 

LAST WEEK

THIS WEEK

% CHANGE

Mkt. Cap (US $ bn)

39.72

39.79

0.18%

Avg. Dly T/O (mn. shares)

299.69

256.55

-14.39%

Avg. Dly T/O (US$ mn.)

555.74

475.28

-14.48%

No. of Trading Sessions

5

4

22

KSE 100 Index

8289.81

8317.36

0.33%

KSE ALL Share Index

5522.52

5540.51

0.33%

 
 

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