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Monday, 25 February 2013

STOCK MARKET UPDATE: 25.02.2013



STOCKS
Karachi Stocks Down 54.21 Points:
KARACHI, Feb 25: The KSE-100 index was at 18020.06, Down 54.21 points.  (Today @ 2.17 pm)



February 23, 2013
 5 TOP GAINERS  &  LOOSERS:

MCB Bank Ltd.
Rs 10.94
Unilever Food
Rs (75.00)
Exide (PAK)
Rs 9.00
Island Textile
Rs (47.50)
Philip Morris Pak.
Rs 8.50
UniLever Pak
Rs (41.82)
Murree Brewery
Rs 7.52
MithchellsFruit
Rs (15.99)
Gillette Pak
Rs 7.13
Shield Corporation
Rs (6.85)

Stocks soar to all-time high at 18,074
KARACHI, Feb 22: The stocks roared higher on Karachi Stock Exchange so as to easily crash through the KSE-100 index barrier of 18,000 points. The index jumped 153.25 points to close at 18,074.27 on Friday.
Led by Engro, MCB Bank and telecoms, all hitting their ‘upper circuit’, the market turned north after an initial extension of the previous day’s decline.
The significant feature of the day’s trading was the non-participation by oil and gas stocks. The heavyweight OGDC remained quiet with a small gain of 48 paisa, contributing at most 10 points to the index rise. Yet, addition of Rs10.94 to the price of MCB Bank stock accounted for almost half of the day’s gains.
Stock brokers, traders and investors celebrated the index rise to another historic high.
One of the leading brokers, Aqeel Karim Dhedhi (AKD) said he was scarcely surprised. “The Pakistan equity market has great potential and there is a long way to go before reaching the cliff,” he said. AKD believed that the healthy corporate earnings and interest rate decline had rejuvenated investor confidence in the market.
Sector-wise, he said, the Oil and Gas sector was benefiting after acceleration in the E&P activities; textiles had benefited from low cotton prices, EU concessions and devaluation of the rupee.
Banks were reporting robust profitability with both textile and banks able to reduce financial charges and bad debts, fertiliser production was set to rise following the solution of gas issues, cements were gaining from increased utilised capacities and higher prices as construction activities pick up pace.
Healthy earnings growth had seen pharmaceutical companies trading at high double digit multiples. Broker AKD said that the Pakistani stocks were currently at multiple of 7 times the forward earnings, which was substantially lower than 9.5 per cent discount rates.
CEO at Topline Securities, Mohammad Sohail said that the index had managed to cross the psychological level of 18,000 points due to continuous buying by foreign fund managers in recent days. He noted that the volumes remained hefty, with the investors focus on telecom stocks due to positive news flow.
Slight correction was, however, witnessed in the oil stocks due to falling international oil prices.
Foreign investors bought shares of the value of $1.9 million on Friday, compared to hefty purchases of $4 million worth stocks on Thursday. The day’s inflow increased the total net buying by foreign funds and individuals for the month to $24.34 million.
Volume increased to 369 million shares on Friday, from 350 million shares traded the previous day. Market

capitalisation scaled to Rs4.492 trillion, from Rs4.465 trillion on Thursday. Trading value also increased to Rs9.4bn, from Rs8.6 billion.
The market capitalisation based KSE-30 index rose by 144.81 points to 14,814.06 points.
In all 365 stocks came up for trading with 208 gainers and 141 losers. The highest gain for the day, amounting to Rs10.94 was noted in MCB Bank, which closed at Rs230.23. On the active list, telecom stocks lead the rally following the Supreme Court ruling against High Court orders on International Clearing House deal raising higher earnings outlook on LDI revenues.
WorldCall Telecom saw highest business in 46 m shares, the stock up by 14 paisa to Rs3.84. Telecard finished ‘limit up’ by addition of Re1 to Rs7.10 on 32m shares; PTCL also hit the ‘upper circuit’, gaining Rs1.14 to Rs23.97 on 30m shares.
TRG Pakistan added 25 paisa to Rs8.28 on 26m shares; Maple Leaf Cement gained 53 paisa to Rs18.94 on 23m shares; Wateen Telecom edged higher by 9 paisa to Rs4.12 on 20m shares; Fauji Cement was up by 14 paisa to Rs7.98 on 20m shares; Jah Sidd Co declined by 26 paisa to Rs18.62 on 15m shares; Nishat Mills recorded sharp gains of Rs3.33 to Rs72.36 on 13m shares and Engro Corporation saw maximum day’s gain of Rs5.16 to Rs108.41 on 12m shares.
KSE-100 index gains 159.25 points: KARACHI: Karachi Stock Exhcnage (KSE) closed higher on Friday after the index crossed 18,000 points, boosted by buying from foreign fund managers in the last few days.
The KSE benchmark 100-share index ended 0.86 percent, or 153.25 points, higher at 18,074.27.
Around 370 million shares were traded, mostly in telecoms companies. Both Pakistan Telecommunication Corporation and Engro Corporation closed at their upper limit.
Their stocks were boosted by news that the courts had approved a rise in international call rates and that the Engro would receive a steady gas supply. Pakistan suffers from chronic gas and electricity shortages.
Some correction was witnessed in oil stocks due to falling international oil prices, said equity dealer Samar Iqbal at Topline Securities.
World Call Telecom rose 2.7 percent to 3.80 rupees and Pakistan Telecommunication Corporation rose 4.99 percent to 23.97 rupees.
In the currency market, the rupee ended at 98.06/98.12 against the dollar, stronger than Thursday's close of 98.13/98.18.
Overnight rates in the money market rose to 9 percent from Thursday close of 8.50 percent.
 Company News:
SNGPL profits turn into loss: ISLAMABAD, Feb 22: Marred by huge system losses, theft and extension of gas connection on political considerations, the Sui Northern Gas Pipelines Limited (SNGPL) has reported to the government that its 17.5 per cent guaranteed rate of return has turned into a 7.06 per cent loss owing to recent decisions of the Lahore High Court and the Oil and Gas Regulatory Authority.
In a letter to the federal government, SNGPL’s managing director Arif Hameed said the returns on average fixed assets of the company for fiscal year 2011-12 have declined to a negative 7.06 per cent instead of guaranteed 17.5 per cent profit under its licence.
He said Ogra did not take into consideration the fact that despite increasing unaccounted for gas (UFG) from 4.5 per cent to 7 per cent and including late payment surcharge as on operating income in pursuance of SNGPL’s petition and stay order granted by the Lahore High Court, “the company managed to earn 4.68 per cent return on its average fixed assets as compared to 17.5 per cent guaranteed as per licence issued to it.”
The SNGPL is a public limited company listed at all three stock exchanges of Pakistan.
Although the major shareholding of nearly 54 per cent was held by the government of Pakistan, almost 46 per cent stake is held by private shareholders.
“These shareholders have made huge investments for which they expect the company to earn profit and declare dividends”, said Mr Hameed.
He said when company announced dividend on Feb 13, it had earned profit of Rs3.044 billion, a majority of which was stilled retained even after announcing the cash dividend.
A subsequent decision on Feb 15, 2013 by the Lahore High Court dismissing SNGPL’s petition (that sought to allow 7 per cent system losses) resulted in a huge loss of Rs8.36 billion (after tax) wiping out almost 65 per cent of the retained earnings accumulated by the company over the years.
“It is pertinent to mention that as a result of this decision, the return on average fixed assets of the company for the year 2011-12 declined from 4.68 per cent to a loss of 7.06 per cent”, the managing director of the SNGPL said.
Early this month, the Ogra had rejected a demand of the petroleum ministry to increase gas tariff for all consumers by about Rs10 per unit by treating Rs11 billion worth of gas theft, pilferage and non-recovery of un-metered gas as gas sales.
The Ogra determination was subject to a case pending before the LHC under which the Ogra had been stopped from reducing the UFG losses to 4.5 per cent from 7 per cent.
Under a 2005 agreement between the Ogra and gas companies, a gradual UFG reduction programme was put in place that required the two gas utilities to bring down their UFG losses from about 11 per cent to 4.5 per cent in 2011. The gas companies, however, failed to meet these targets and their UFG still goes beyond 10 per cent.
On top of that, the utilities wanted the Ogra to recover the cost of gas theft and losses in areas affected by law and order situation from consumers throughout the country and allow certain quantities of unmetered gas from all consumers.
This was not acceptable to Ogra that had come under scrutiny before the Supreme Court of Pakistan in a Rs82 billion Ogra corruption case.

MOHAMMED SALEEM MANSOORI

1 comment:

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