STOCK MARKET UPDATE: 09.04.2013

STOCKS

Karachi Stocks Up 17.03 Points:
KARACHI, Apr 08: At the close of trading,  the KSE-100 index was at 18653.06, up 17.03 points. 

 (Today 9^th April- Market is 52.32 Up@ 10.46 am)

April 8, 2013

 5 TOP GAINERS  &  LOOSERS:

Unilever Food	Rs 221.00	Fazal Textile	Rs (10.03)
UniLever Pak	Rs 66.45	Atlas Honda Ltd	Rs (5.50)
Colgate Palmolive	Rs 50.00	Shezan Inter.	Rs (4.70)
Bata (Pak)	Rs 46.26	Shell Pakistan Ltd.	Rs (2.68)
Wyeth Pak Ltd	Rs 49.14	Exide (PAK)	Rs (2.50)

Karachi Stocks manage modest gains

KARACHI, April 8: The stock market remained lacklustre, in cautious trading on Monday. After rising by over 500 points last week, the market was taking a breather, dealers said.
The KSE-100 index moved slightly up by 17.03 points to 18,653.06 points in hugely curtailed activity. The volume in terms of shares fell by 40 per cent to 124 million shares, from 207m shares last Friday. Trading value was even lower by 45pc to Rs3.623 billion, from Rs6.595bn.
Mohammad Imran, head of equity sales at Arif Habib Limited, said that the market was in consolidation phase. Investors were watching both the progress on the election process and the upcoming Monetary Policy Statement by the SBP.
Although the discount rate was thought to remain unchanged, there could be surprise for banks. He said that the healthy results from companies about to announce earnings and dividend could be harbinger of good tidings for the market.
Ovais Ahsan, analyst at JS Global stated that the market continued to cautiously tread and intraday gains were curtailed by profit-taking. The disqualification of prominent political figures by the Election Commission of Pakistan and the overwhelming number of disqualification reviews received by the commission had prompted some investors to seek the safety in profit-taking.
Murtaza Jaffer, Fund manager at Askari Investments said that the market outlook was positive, though the investors had opted to book profit at the current high levels.
He said the market was expecting the nomination of care-taker finance minister this week and as the MPS was to be unveiled on April 12, the market appeared to have taken a pause, as happens every time in the days ahead of the announcement of MPS.
Several analysts believed that the lean period for the market could be over as early as next week when the first big ticket results of Fauji Fertiliser and Fauji Bin Qasim are released.
Market capitalisation was up by Rs7bn to Rs4.594 trillion, from Rs4.587tr.
The figures released by the National Clearing Company of Pakistan revealed foreign selling at $0.84 million on Monday. That was in extension of the Friday’s outflow of $1.0 million. But for all of last week foreigners were net buyers of stocks worth $5.7 million.
Among the local participants, companies sold shares valued at $1.47bn on Monday, banks bought $0.35m, mutual funds and individuals also picked up equities valued at $1.2m and $1.52m, respectively.
The KSE-30 index was almost flat at 14,551 points, compared to 14,546 points last Friday.
Among the volume leaders, BankIslami Pakistan was ahead with trading seen in 13m shares, down by 27 paisa to Rs6.39.
Zulqarnain Khan of NEXT Capital said that BankIslami had remained in the highlight on market talk of bank having achieved deposits of over Rs65bn and the branch network expected to grow to 200 from 141 by Dec 31, 2013. Jah Sidd Co shed 13 paisa to Rs13.17 on 9m shares, PTCL was up four paisa to Rs21.27 on 6m shares, PIA down 29 paisa to Rs6.43 on 6m shares.
Maple Leaf Cement added 38 paisa to Rs19.05 on 6m shares and D.G. Khan Cement climbed by 75 paisa to Rs73.05 on 5m shares.
Other than that, index heavyweights Engro Corporation up by Rs2.23 and OGDC higher by 47 paisa were the leading gainers, among the 172 shares that closed in positive territory on Monday. The banking sector led by MCB Bank was among the 165 total issues, which ended in on the declining side.

Company News:

Attock Petroleum to bid for Chevron: KARACHI, April 8: Attock Petroleum Limited (APL) would participate in the bidding for acquisition of Chevron (formerly Caltex Oil Pakistan Limited) marketing affiliates in Pakistan, which includes 100 per cent shareholding in Chevron Pakistan Limited (excluding Lubricants Business) and 12pc stake in Pakistan Refinery Limited.
The decision by the APL Board, conveyed on Monday, appeared to have been prompted following the completion of due diligence which the company had announced it was to conduct on Nov 20 last year.
APL is the second party to be in the race for buyout of Chevron’s downstream fuel assets in Pakistan; Byco Petroleum Limited (Byco) being the other contender believed to be in the process of conducting due diligence for the acquisition.
The APL decision was warmly greeted at the Karachi stock exchange on Monday where the expensive APL stock rose by Rs1.68 to Rs498.51 on a tiny turnover of 17,300 shares.
“Chevron’s plans to exit Pakistan’s downstream space would eventually benefit existing players as the government focuses on key issues faced by the industry in an effort to improve the operating environment”, a research note by Mohammad Fawad Khan, analyst at KASB Securities an affiliate of Bank of America Merrill Lynch, said.
In Pakistan, currently there are 10 players in the oil marketing industry with aggregate volume at 20.27 million tons. Based on comparables, in the absence of availability of Chevron’s financials, the analyst put the deal size at Rs10 to 16 billion. A change in deal structure was thought to attract more players to make a bid.
APL and Byco were both thought to be strong contenders, because of having refining backup, strong financial muscle and intentions to increase their foot print. Exit of Chevron and acquisition by existing player was, however, unlikely to have any implication on prices and margin as most of fuel products were regulated.
For Chevron, strong position in high margin lube segment (23pc market share) remained a key jewel. KASB analyst had predicted a month ago that Chevron could decide to maintain its position in the lube segment. It has to be seen if Chevron decides to strip it off and sell separately in order to fetch better price.
Market watcher said that the operating environment for small players like Chevron had become increasingly difficult as a result of several factors including fixed-margin environment; competitive landscape in favor of integrated players (Chevron is standalone marketing company); fiscal regime (turnover tax); oil prices volatility and low operational and cost efficiency.
In regard to Chevron Pakistan Limited, another oil sector analyst pointed out that it was a part of Chevron Corporation, one of the leaders in the global integrated energy business. Chevron is headquartered in San Ramon California.
Following the merger of its parent companies – Chevron and Texaco – in 2001 and subsequent change of the parent company’s name from Chevron Texaco to Chevron in 2005, Caltex Oil Pakistan Limited was renamed as Chevron Pakistan Limited in 2006.
The company has operated in the sub-continent since 1938. It is presently engaged in the Fuels, Lubricants, CNG and LPG business in Pakistan. The company is marketing its products and services under the Caltex master brand.

MOHAMMED SALEEM MANSOORI