KASB Morning Shout April 12, 2021

Pakistan’s market witnessed a volatile week with highs and lows. Ultimately, the index closed in green and gained 886pts over the week. The initial downtrend was instigated by rising COVID-19 cases while the eventual recovery was likely by bargain hunters aiming to benefit from attractive valuations.

KASB Market View

All eyes will be on the upcoming result season, which is likely to reflect improving macros including a sharp recovery in economic activity. While COVID-19 cases continue to proliferate amidst the 3rd wave, we believe the market will continue to perform particularly after the planned vaccination drive. We continue highlighting our preference for cyclical stocks including Cements and Steels.

National News

Pakistan eyes another $1b debt relief from G-20

The global debt payments suspension initiative has provided a temporary relief of around $3.5 billion to Pakistan and one-third of the relief has come from China, reducing immediate borrowing requirements by the same amount.

https://tribune.com.pk/story/2293963/pakistan-eyes-another-1b-debt-relief-from-g-20

Cut in rate of return of 12 IPPs to help govt save Rs150bn

The National Electric Power Regulatory Authority (Nepra) on Friday approved reduction from 17 to 12-13 per cent in the Return on Equity (RoE), Return on Equity during Construction (RoEDC), Operation & Maintenance and Insurance components of a total of 12 renewable independent power producers (IPPs) under renegotiated tariff contracts with the government.

https://www.dawn.com/news/1617383/cut-in-rate-of-return-of-12-ipps-to-help-govt-save-rs150bn

Engro okays $31m for new facility

Engro Corporation Ltd informed the PSX: “In continuation of our letter dated April 26, 2019, in relation to the company’s intent to explore investment opportunities in the petrochemical sector and the approval of the board for commencement of a study in relation to a polypropylene facility based on propane dehydrogenation”.

https://www.dawn.com/news/1617378/engro-okays-31m-for-new-facility

Pakistan Refinery seeks used complex to upgrade operations

Pakistan Refinery Ltd (PRL) is looking to buy a second-hand refinery complex to upgrade its operations and increase output to help meet rising demand for petroleum products as the country emerges from a pandemic-driven slump.

https://www.dawn.com/news/1617380/pakistan-refinery-seeks-used-complex-to-upgrade-operations

Customs probes illegal transfer of forex through iron, steel import

Pakistan Customs has launched an investigation into illegal transfer of foreign exchange by importers of iron and steel goods under doctored invoices, sources said on Friday.

https://www.thenews.com.pk/print/817671-customs-probes-illegal-transfer-of-forex-through-iron-steel-import

Uptick in weekly inflation

Weekly inflation for the combined group in the period ended on April 8 slightly increased by 0.60 per cent on the back of an uptick in prices of essential food items, showed data released by the Pakistan Bureau of Statistics (PBS) on Friday.

https://www.dawn.com/news/1617379/uptick-in-weekly-inflation

Govt mulls cotton import from Uzbekistan

The government is considering an option to import cotton from Uzbekistan via land routes after it took back a decision of its import from India, Commerce Adviser Razak Dawood said, as textile exporters want government to take decisive steps amid 40 percent drop in the crop output.

https://www.thenews.com.pk/print/818102-govt-mulls-cotton-import-from-uzbekistan

Exchange companies deposit $2.8bn in banks in 9MFY21

Foreign currency dealers in the open market have deposited more than $2.8 billion in banks during the first nine months of the current fiscal year (9MFY21) indicating the deposits could touch an all-time high figure of $4bn by the end of FY21.

https://www.dawn.com/news/1617598/exchange-companies-deposit-28bn-in-banks-in-9mfy21

SUV tyre manufacturing begins

General Tyre and Rubber Company of Pakistan Limited (GTR) has started manufacturing 18-inch tyres for Sports Utility Vehicle (SUV).

https://www.dawn.com/news/1617597/suv-tyre-manufacturing-begins

FBR gets 6th chairman in 32 months

The government on Friday appointed Asim Ahmed as Chairman of the Federal Board of Revenue (FBR) – the sixth head of the revenue board in around two and a half years – who will face a new challenge of exerting his office authority besides increasing tax collection by 27% in the next fiscal year.

https://tribune.com.pk/story/2293962/fbr-gets-6th-chairman-in-32-months

Public debt up by Rs12.5tr in 30 months

Finance and Revenue Minister Hammad Azhar on Saturday told the National Assembly that the country’s public debt had increased by Rs12.5 trillion in 30 months — between June 2018 and December 2020.

https://tribune.com.pk/story/2294061/public-debt-up-by-rs125tr-in-30-months

Rs500.94bn released against budgeted Rs650bn

The federal government has released Rs500.94 billion (77.1 percent) including Rs82 billion foreign aid for various ongoing and new development projects under the Public Sector Development Programme (PSDP) 2020-21 against the budgeted allocation of Rs650 billion.

https://epaper.brecorder.com/2021/04/11/1-page/881819-news.html

SUV tyre manufacturing begins

General Tyre and Rubber Company of Pakistan Limited (GTR) has started manufacturing 18-inch tyres for Sports Utility Vehicle (SUV).

https://www.dawn.com/news/1617597/suv-tyre-manufacturing-begins

Modaraba cos can extend Rs20m housing finance: SECP

The Securities and Exchange Commission of Pakistan (SECP) has directed the Modaraba companies to extend housing finance facilities to its customers within the category of individuals with a maximum limit of Rs20 million.

https://epaper.brecorder.com/2021/04/11/9-page/881880-news.html

Blue-Chip
-Word of the Day-

Blue chip, meaning “a stock issue of high investment quality that usually pertains to a substantial, well-established company,” was first noted in the late 19th century. From this meaning extended senses developed, such that blue chip applies to a consistently successful and profitable venture or enterprise, an outstandingly worthwhile and valuable property or asset, and an athlete rated as excellent or as an excellent prospect.

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