The Week in Review. For the period Feb 25, 2019 Mar 1, News This Week. Stock Market Overview. REP 039

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1 The Week in Review For the period Feb 25, 219 Mar 1, 219 News This Week 4,5 KSE1 Border tensions domineer the index Reserves edge lower 39,5 FBR misses collection target by PKR235bn for 8MFY19 Stabilization to lower growth rate to 4.2% 38,5 USD2.7bn foreign aid received in 7MFY19 37,5 IMF, Pakistan to soon reach USD12bn bailout deal: Fitch Partial increase in all prices of POL products 36,5 USbased Cargill to invest in port infrastructure 35,5 MatiariLahore HVDC transmission line project achieves financial Mon Tue Wed Thu Fri close Govt likely to allow private sector to import LNG: minister Financing schemes launched for energy, agri projects Stock Market Overview Border tensions between Pakistan and India remained on the forefront during the week resulting in a volatility for the benchmark index. The market recovered slightly on the last day of the week as Pakistan agreed to release the Indian pilot to deescalate tensions. The benchmark index closed at 39,539pts, down 1.2%WoW. The benchmark index closed at 39,539pts, down 1.2%WoW. Market participation increased as evident from decrease in ADT and ADTV by 51.9%WoW and 33.1%WoW, respectively. Foreign investors were net sellers, exhibiting an outflow of USD1.3mn. PAKT, AGIL, DAWH, MEB Land ARPL were the major gainers while ASTL, EFOODS, PIOC, NRL, and SSGC were the major losers in the benchmark KSE1 this week. REP 39 BIPL Securities Limited 5 th Floor, Trade Centre, I.I. Chundrigar Road, Karachi 1

2 KSE1 Border tensions domineer the index Date Open High Low Close Change Vol (mn) 25Feb19 39,99 4,46 39,551 39,67 1.% 68 26Feb19 39,422 39,67 38,727 38,822 2.% Feb19 38,63 38,858 37,33 38,693.3% Feb19 38,815 39,149 38,558 39,55.9% 159 1Mar19 39,84 39,713 39,55 39, % 137 Market Review Border tensions between Pakistan and India remained on the forefront during the week resulting in a volatility for the benchmark index. The market recovered slightly on the last day of the week as Pakistan agreed to release the Indian pilot to deescalate tensions. The benchmark index closed at 39,539pts, down 1.2%WoW. Market participation increased as evident from decrease in ADT and ADTV by 51.9%WoW and 33.1%WoW, respectively. Foreign investors were net sellers, exhibiting an outflow of USD1.3mn. During the week, the government increased the prices of petroleum products, where prices of petrol and HSD were increased by PKR2.5/litre and PKR4.75/litre, respectively. Additionally, SBP launched three Shariah Compliant Refinance Schemes for investments in the renewable energy and agrirelated projects to provide level playing field to Islamic banking system. Furthermore, Cargill, the USbased company with global outreach is expanding its footprint in Pakistan by diversifying operations mainly into port infrastructure. Also, MatiariLahore HVDC transmission line project achieved financial close and will be fully operational by Mar 21. On the macro front, foreign exchange reserves held by SBP declined marginally by USD6.mn to USD6.8bn. Additionally, the government acknowledged that the GDP growth target would be missed by 2% as a result of stabilization efforts. Furthermore, according to Fitch Solutions, Pakistan and IMF will soon reach a bailout deal with a potential size of USD12bn but the country is expected to have an increasing pressure to improve fiscal consolidation through austerity measures. During 8MFY19, FBR missed the revenue collection target by PKR235bn as total revenue collections clocked in at PKR2.3trn. Moreover, foreign assistance in 7MFY19 decreased by 6%YoY to USD2.7bn as against USD6.9bn received SPLY. Outlook The market would await India s response to Pakistan s peace gesture, where any negative response from India would dampen market sentiments. 2

3 News This Week Economic highlights & data points Reserves edge lower (Dawn): Reserves held by the State Bank of Pakistan decreased by a marginal USD6.mn to USD8.bn during the week ended on Feb 22. Holdings of the commercial banks were recorded at USD6.8bn while total liquid reserves of the country stood at USD14.8bn. FBR misses collection target by PKR235bn for 8MFY19 (Dawn): The Federal Board of Revenue (FBR) missed collections target by PKR235bn during 8MFY19, according to provisional figures released on Thursday. Stabilization to lower growth rate to 4.2% (BR): The government on Tuesday acknowledged that GDP growth target for the current fiscal year will be missed by a whooping 2% and would remain 4.2% and attributed the slowdown to stabilization. "The GDP growth would remain 4.2% for the current fiscal year," said Minister of State for Revenue Hammad Azhar during a meeting of the National Assembly Standing Committee on Finance. USD2.7bn foreign aid received in 7MFY19 (BR): The country provisionally received USD2.7bn foreign assistance in 7MFY19 against USD6.9bn during the same period of last year (21718), showing a reduction of about 6%. IMF, Pakistan to soon reach USD12bn bailout deal: Fitch (The News): Pakistan and the International Monetary Fund (IMF) will soon reach a bailout deal with a potential size of USD12bn, but the South Asian country is expected to have an increasing pressure to improve fiscal consolidation through austerity measures, Fitch Solutions said. Sector and Corporate highlights Partial increase in all prices of POL products (BR): The federal government on Thursday notified partial increase in the prices of all petroleum products for the month of March. In monthly review, the government has increased the price of motor spirit (MS) by PKR2.5/litre. The price of high speed diesel (HSD) has also been increased by PKR4.75/litre. USbased Cargill to invest in port infrastructure (Tribune): Cargill, the USbased company with global outreach, which is operating for over three decades in Pakistan, is expanding its footprint in the country by diversifying operations mainly into port infrastructure. MatiariLahore HVDC transmission line project achieves financial close (Dawn): MatiariLahore highvoltage direct current (HVDC) transmission line project with an estimated cost of USD1.65bn has secured financing and will be fully operational in March 221, the developer said on Wednesday. Govt likely to allow private sector to import LNG: minister (BR): Allowing the private sector to import liquefied natural gas (LNG) is under serious consideration by the Petroleum Division. Privatesector players have approached the government seeking permission to import gas to meet idle capacity of LNG terminals at competitive rates. Financing schemes launched for energy, agri projects (Dawn): The State Bank of Pakistan (SBP) has launched three Shariah Compliant Refinance Schemes for investments in the renewable energy and agrirelated projects to provide level playing field to Islamic banking system, according to a press release issued on Friday. 3

4 Dec9 Apr1 Sep1 Feb11 Jul11 Dec11 May12 Oct12 Mar13 Aug13 Jan14 Jun14 Nov14 Apr15 Sep15 Jan16 Jun16 Nov16 Apr17 Feb18 Dec18 Stock Market Outgoing week in pictorals Chart 1: KSE1 Index 39,8 39,6 39,4 39,2 39, 38,8 38,6 Chart 2: KSE Advance/Decline Ratio ,4.5 38,2. Chart 3: Pak Foreign Portfolio Flows (US$mn; US$=PKR13) (.) (.7) 5 (3.7) (2.6) 7 (4.9) 9 (7.3) (6.8) (8.5) 11 Inflow Outflow Net Chart 4: KSE Volume & Value Shrs mn Volume Value PKRmn 12, 1, 8, 6, 4, 2, Chart 5: Price to Money Ratio Chart 6: Off market activity 9.% 8.% 7.% 6.% 5.% 4.% 3.% 2.% 1.%.% PKRmn shrs (') 1, 9, 8, 7, 6, 5, 4, 3, 2, 1, Value Traded (PkRmn) Turnover (') 4

5 Mar14 Jul14 Nov14 Mar15 Jul15 Nov15 Mar16 Jul16 Nov16 Mar17 Jul17 Nov17 Mar18 Nov18 Mar19 Jan16 Mar16 May16 Jul16 Sep16 Nov16 Jan17 Mar17 May17 Jul17 Nov17 Jan18 Mar18 May18 Mar17 Apr17 May17 Jun17 Jul17 Aug17 Oct17 Nov17 Dec17 Jan18 Feb18 Mar18 Apr18 May18 Jun18 Aug18 Sep18 Oct18 Nov18 Dec18 Jan19 Feb19 Mar19 Sep18 Nov18 Jan19 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 Dec16 Mar17 Jun17 Dec17 Mar18 Jun18 Sep18 Feb13 Jun13 Oct13 Feb14 Jun14 Oct14 Feb15 Jun15 Oct15 Feb16 Jun16 Oct16 Feb17 Jun17 Oct17 Feb18 Jun18 Oct18 Feb19 Economy Watch Chart 7: Revenue Collection (PKRbn) Chart 8: Forex Reserves (US$mn) 3, 25, 2, 15, 1, 5, Chart 9: Import & Export (US$mn) 6, 5, 4, 3, 2, 1, Chart 1: Foreign Exchange Rate (PKR/US$) Import Value Export Value Chart 11: 6mth TBill Yield (%) 12% 1% 8% 6% 4% 2% Chart 12: Yield Curve (%) 16.% 14.% 12.% 1.% 8.% 6.% 4.% % 2.% 3m 6m 1 yr 3 yr 5 yr 1yr 15 yr 2 yr 3 yr Jan19 Jan18 Jan17 5

6 Stock Market Synopsis Last week This Week Change 1M 3M 12M Mkt. Cap (US $ bn) % Avg. Dly T/O (mn. shares) % Avg. Dly T/V (US$ mn.) % No. of Trading Sessions KSE 1 Index 4, , % 39, , ,51.4 KSE ALL Share Index 29, ,852..6% 28, , ,451.9 Chart 13: KSE1 Active Issues (ADTOmillion shares) Chart 14: KSE1 Least Traded Issues (ADTO shares) Bank Of Punjab. Gatron (Industries) Ltd. KElectric Limited. Pakistan Intl. Bulk Terminal Ltd. Engro Polymer & Chemicals Ltd. Jubliee Life Insurance Co Ltd. Pakistan Services Limited. Bata Pakistan Ltd. Fauji Cement Co Ltd. Philip Morris (Pakistan)Ltd Chart 15: KSE1 Top Gainer (% change) Chart 16: KSE1 Top Losers (% change) Pakistan Tobacco Co Ltd. Amreli Steels Limited. Agriautos Industries Co. Ltd. Engro Foods Limited. Dawood Hercules Corporation Ltd. Pioneer Cement Ltd. Meezan Bank Limited. National Refinary Ltd. Archroma Pakistan Limited. Sui Southern Gas Co Ltd. % 4% 8% 12% 16% 18% 15% 12% 9% 6% 3% % 6

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