Elixir Securities Limited – Pakistan Weekly

Karachi, February 26, 2016 (PPI-OT): PSX snaps losing streak

During the week, local bourse witnessed a retracement and posted a gains of approximately 0.9%WoW (↑282.31pts), closing the benchmark index to 31,294.08pts amidst thin volumes. Volatility in the benchmark index continued its correlation with uncertain international commodity/equity markets.

Value hunting strategy was observed in the outgoing week, where OGDC, KAPCO, MCB and ENGRO cumulatively added 225.5pts to the index. However, NESTLE, SEARL, DAWH and MARI cumulatively dragged the index by 88.89pts.

Trading volumes remained muted with average daily trading volume reached at 138mn during the week, declining by 6% WoW with retail favourites (TRG, KEL, PAEL, NIB and JSCL) posted 23% of overall market volumes.

Foreigners remained net sellers during the week, offloading USD4.8mn worth of shares versus USD10mn in last week.

Key news this week

Current account deficit surpasses $2bn

Pakistan lifts Iran sanctions, eyes $5bn trade

For Quaid-e-Azam Thermal Power: NEPRA allows Rs6.58 per unit interim tariff

January 2016: Banking spread shrinks to 5.12%, lowest in 11 years

Prime Minister to launch Karachi’s Green Line Bus Rapid System today

This week’s top stories

United Bank Limited – Diversified Revenue Mix to Support Bottom-line

Engro Corporation Limited – Triggers in the offing warrant exuberance

Engro Corporation Limited 4Q EPS Expected at PKR10.65/Share

FATIMA: Superior Risk/Reward profile in Fertilizer space; Reiterate BUY!

Pakistan Economy – Inflation Preview – Feb 2016

Future outlook

Going forward, culmination of key corporate results coupled with increasing regulatory oversight will weigh on investor sentiments, in Elixir Securities Limited’s view. However, any surprise on the upcoming inflation print which is expected to unveil in the mid of next week (Elixir estimates at 3.9%-4.0%) can serve sentiment booster. Elixir Securities Limited advises investors to trade wisely and continue hunting stocks which have robust fundamentals. Thus, Elixir Securities Limited highlights LUCK, DGKC, OGDC, PPL, PSO, and ENGRO as Elixir Securities Limited’s preferred plays.