Economy: MSCI FM Standard Index Expands to 22 Stocks - By AHCML Research

Feb 12 2025


Al Habib Capital Markets


  • MSCI, a leading provider of investment decision support tools and services, has released the results of its February 2025 Index Review for the MSCI Equity Indexes. The announced changes will take effect after the market closes on February 28, 2025.
  • As part of the review, two Pakistani stocks, Abbott Laboratories (ABOT) and The Searle Company (SEARL), have been added to the MSCI Standard Index, increasing the total number of Pakistani companies in the index from 18 to 20.
  • In the MSCI Small Cap Index, three companies—BF Biosciences (BFBIO), Bifo Limited (BIFO), and Power Cement (POEWER)—have been included. However, three companies—Attock Refinery Limited (ATRL), Askari Bank Limited (AKBL), and Airlink Communications—have been removed from the Small Cap Index. Additionally, SEARL has been upgraded from the Small Cap Index to the Standard Index.

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AirLink Communication Ltd ((AIRLINK): Innovation unplugged - By Foundation Research

May 27 2025


Foundation Securities


  • We initiate coverage on AirLink Communication Ltd. with an ‘Outperform’ rating and a Dec’25 TP of PKR 273.3/sh, implying a 67.8% upside. AIRLINK has established a strong position in the mobile manufacturing market through the local assembly of prominent brands including Xiaomi, Tecno, and Itel. The company has ambitious plans to expand its product portfolio further by venturing into the manufacturing of laptops, TV’s and EV’s.
  • Our positive outlook on AIRLINK is supported by (1) increasing broadband and smartphone penetration in Pakistan, (2) strategic expansion aided by a 10-year tax holiday, (3) rising market share of low budget smartphones, (4) diversification into laptops and TVs, (5) potential in Xiaomi smartphone exports, and (6) expanding horizons with EV’s. Despite growing competition, the company’s forward looking initiatives position it strongly to capitalize on untapped market opportunities.
  • Increasing broadband and smartphone penetration: Pakistan’s smartphone penetration (31%) is significantly lower than in neighboring India (47%) and other developing countries (avg: 54%) with a GDP per capita close to Pakistan’s. Similarly, smartphone penetration in South-East Asia stood at 79% in 2024, highlighting the gap and growth opportunity in Pakistan. Improved internet access and evolving popularity of social apps coupled with digitalization are likely to keep demand for smartphones robust in the near term.
Pakistan Economy: May-25 CPI likely at 2.7%, base effect wears off - By JS Research

May 27 2025


JS Global Capital


  • Pakistan's Consumer Price Index (CPI) is expected to clock in at 2.7% for May-2025. The base effect is now fading, signalling a return to normalized price trends. This is likely to take 11MFY25 average inflation to 4.7%, down from 11MFY24 average of 24.9%.
  • Due to the rapid disinflation during the year, our base case CPI forecast for FY25 averages 4.6%. The rolling 12-month forward CPI estimate stands at around 5.7%.
  • State Bank of Pakistan (SBP) reduced policy rate to 11% in the last MPC meeting, owing to rapidly declining inflation. A further rate cut of 50-100bps cannot be ruled out in the near future. SBP is scheduled next to meet on 16th June 2025 for its Monetary Policy Committee (MPC) meeting.
Morning News: IMF in disagreement over key targets, subsidies - By Vector Research

May 27 2025


Vector Securities


  • The Finance Ministry said on Monday that the presentation of the Federal Budget 2025-26 has been delayed from June 2 to June 10 due to disagreements with the International Monetary Fund (IMF) over key budgetary figures, including subsidy allocations.
  • Prime Minister Muhammad Shehbaz Sharif said that the bilateral trade between Pakistan and Iran which stood at $3billion would be taken to $10 billion volume in the next few years, as there was immense potential of growth. Prime Minister Shehbaz Sharif on Monday departed to Iran after concluding his two-day official visit to Turkiye.
  • Despite projected remittance inflows of $38 billion in the current fiscal year (FY25), Pakistan’s per expatriate remittance remains significantly lower than that of peer countries. “Although remittances have grown at a compound annual rate of 6.1 per cent from 2013 to 2023, per expatriate remittance remains low in comparison to other countries in the region,” said a report released by the Policy Research and Advisory Council (PRAC) on Monday.
Morning News: Budget features bold measures for ‘strategic direction - By HMFS Research

May 27 2025


HMFS Research


  • Finance Minister Muhammad Aurangzeb on Monday pledged that the upcoming federal budget would introduce “bold measures” to steer the national economy in a strategic direction and make available whatever support is required by the armed forces. Further said that every possible support would be provided to the armed forces, stressing that it was a national need in light of recent cross-border aggression, not just a military requirement. He said the government would ensure simplified tax returns and forms for the salaried class. He said that around 70 to 80 percent of salaried people did not hold equity and fixed-income portfolios. “They receive salaries through bank accounts with tax deducted at source. They should not have to fill in 140-150 data points,” he said, adding that the government aimed to reduce that number to just nine — five for wealth tax and four for income tax. He said the process would now be accelerated, with transactions involving Pakistan International Airlines (PIA), three power distribution companies and some financial institutions expected to reach completion by the end of this year.
  • The Finance Ministry said on Monday that the presentation of the Federal Budget 2025-26 has been delayed from June 2 to June 10 due to disagreements with the International Monetary Fund (IMF) over key budgetary figures, including subsidy allocations. “The budget announcement has been delayed by a week because the Finance Ministry’s figures are still under reconciliation. The IMF has placed a cap on subsidies,” he added. He further noted that the IMF has declined to make any changes to the revised budget figures recently presented to the Fund’s team.
  • The government is seriously considering reducing federal excise duty (FED) on beverages (aerated water) in the coming budget (2025-26) to attract foreign investment in this sector. Foreign investors including Turkish investors have promised more foreign direct investment in beverage sector in case of tax relief in the coming budget (2025-26). Leading global players with Turkish and Korean franchise investors have invested over USD 2 billion in Pakistan since 2018. However, no new investments have been made since 2023 due to the current fiscal environment. The industry contributes over Rs 175 billion in taxes annually (FED, GST, income tax, super tax) - one of the highest taxed sectors.
K-Electric (KEL): Transmission and Distribution Tariff Unveiled All three businesses now will get USD tariff - By Topline Research

May 26 2025


Topline Securities


  • In Seven months after securing dollarized tariff for generation business, the K-Electric (KEL) has also secured dollarized tariff for its transmission and distribution business for 7 years, i.e. from FY24 to FY30.
  • Distribution Business awarded USD ROE of 14%: NEPRA has awarded USD IRR of 14% to KEL for distribution business against requested USD IRR of 16.67%. The USD IRR of 14% translates into PKR ROE of 25.6% for Y1 (i.e. FY24). Which is better than previous tariff PKR return of 16.67%.
  • Transmission Business awarded USD ROE of 12%: NEPRA has awarded USD IRR of 12% to KEL for transmission business against requested USD IRR of 15%. The USD IRR of 12% translates into PKR ROE of 21.4% for Y1 (i.e. FY24). Which is better than previous tariff PKR return of 15%
Market Wrap: Highlights of the day May 26, 2025 - By JS Research

May 26 2025


JS Global Capital


  • The KSE-100 Index fell 0.8% to an intraday low of 118,150, as investor sentiment weakened due to the government's delay in presenting the federal budget and ongoing uncertainty surrounding IMF fiscal targets. The postponement of Budget 2025–26 and unresolved negotiations with the IMF are driving the risk-off behavior. Market direction remains contingent on clarity from upcoming IMF discussions and the budget announcement; volatility is likely to persist until fiscal policy details are finalized.
Pakistan Economy: OPEC’s aggressive output hike puts Pakistan in a sweet spot - By Insight Research

May 26 2025


Insight Securities


  • OPEC+ is expected to announce another output hike of 411 k bbl/day starting July, according to multiple news reports . During the group’s upcoming meeting on June 1st, members are likely to approve a production increase that is three times larger than the previously planned hike of 137 k bbl/day . If materialized, this move could add pressure to already struggling international crude oil prices, which have been weighed down by a weak global economic outlook.
  • Sources close to the group indicate that larger -than -expected output hike may be part of a broader strategy to bring as much as 2 . 2mn bbl/day back into the market by Nov’25 . The decision is widely seen as an effort, particularly by Saudi Arabia to regain lost market share and push high cost producers out of the market . Notably, Saudi Arabia’s market share has been on a declining trend since 2022 , following OPEC+ production cuts that reduced the cartel’s overall share in global oil supply . KSA’s market share declined even faster than the group’s average . The current strategy also appears to target non -compliant OPEC+ members, with Saudi Arabia leveraging its cost advantage to reclaim share from both shale producers and cartel members who are not adhering to quotas . Additionally, experts suggest a geopolitical angle to the move, particularly in the context of U . S . -Saudi relations . The Trump administration is reportedly keen on lower oil prices to curb inflation and restore market confidence especially due to tariff-induced uncertainty . On the other hand, Saudi Arabia is seeking deeper defense cooperation and has recently announced plans to invest US $600bn in US .
  • We believe that Saudi Arabia aims to capture market share from high -cost producers while maintaining some degree of control on prices through monthly OPEC+ meetings, as highlighted in group’s recent press releases . A sharp price decline would not be in KSA’s interest, especially considering its ambitious development plan .
Pakistan Economy: National Consumer Price Index (NCPI) - By AHCML Research

May 26 2025


Al Habib Capital Markets


  • Inflation in May’25 is expected to clock in at 3.0% YoY, up from 0.3% in Apr’25 and down from 11.8% in May’24, as base effects continue to fade. On a monthly basis, CPI is likely to decline by 0.6% MoM, posting the second consecutive drop, mainly due to a 2.3% fall in food prices amid improved supply of perishables. However, poultry shortages are expected to push egg and chicken prices up by 32.8% and 20.7% MoM, respectively.
  • The transport index is expected to decline by 0.7% MoM due to lower fuel prices, while the clothing and footwear index is projected to rise by 1.2% MoM.
  • On a YoY basis, food inflation is anticipated to ease to 0.9%, but non-food inflation is likely to remain elevated, led by healthcare (+12.5%), education (+10.4%), clothing (+9.9%), and restaurants (+8.4%).
K-Electric (KEL): NEPRA approves Multi-Year T&D Tariff for K-Electric - By Taurus Research

May 26 2025


Taurus Securities


  • NEPRA has approved Multi-Year Tariff for Transmission & Distribution (T&D) network segments of K-Electric for FY24- FY30. Salient features of the multi-year tariff approved by NEPRA are as follows:
  • Control Period: 7 Years, from FY24- FY30.
  • Allowed Debt-to-Equity Ratio: 70:30.
Pak Aluminium Beverage Cans Ltd (PABC): Exports outlook gets weaker; Reiterate Sell - By JS Research

May 26 2025


JS Global Capital


  • We tweak down our CY25E/CY26E EPS estimates for Pak Aluminium Beverage Cans Ltd (PABC) by 9% and TP by 4%. The revision is mainly led by the expected fall in volumes led by border issues with Afghanistan coupled with the upcoming capacity expansions in Central Asia, which may adversely impact PABC’s export prospects to the region. We reiterate our Underperform rating for the stock with a TP of Rs110.
  • Furthermore, any reduction in regulatory duty in the upcoming budget (from 22%-26% currently to 15% or less) given to the local industry, may create pressure on sales volumes from dumping of cheaper products in the country.
  • We consider resumption of dividend payout and announcement of any Capex or investment plan as key triggers for the stock going forward. To highlight, PABC stands at net cash position of Rs10.7bn (Mar-2025).
Pakistan Economy: National Consumer Price Index (NCPI) - By AHCML Research

May 26 2025


Al Habib Capital Markets


  • Inflation in May’25 is expected to clock in at 3.0% YoY, up from 0.3% in Apr’25 and down from 11.8% in May’24, as base effects continue to fade. On a monthly basis, CPI is likely to decline by 0.6% MoM, posting the second consecutive drop, mainly due to a 2.3% fall in food prices amid improved supply of perishables. However, poultry shortages are expected to push egg and chicken prices up by 32.8% and 20.7% MoM, respectively.
  • The transport index is expected to decline by 0.7% MoM due to lower fuel prices, while the clothing and footwear index is projected to rise by 1.2% MoM.
  • On a YoY basis, food inflation is anticipated to ease to 0.9%, but non-food inflation is likely to remain elevated, led by healthcare (+12.5%), education (+10.4%), clothing (+9.9%), and restaurants (+8.4%).
Economy: IMF Backs Pakistan’s Reforms With USD2.4bn Funding Package - By AHCML Research

May 19 2025


Al Habib Capital Markets


  • The IMF report on Pakistan highlights the country's economic performance under the Extended Fund Facility (EFF) program, noting improvements in fiscal discipline, external stability, and structural reforms. However, challenges persist, including subdued growth, elevated core inflation, and risks from external shocks such as recent US tariff hikes. Key achievements include meeting quantitative performance criteria (QPCs), rebuilding foreign reserves, and advancing tax reforms. The report emphasizes the need for sustained policy tightening, fiscal consolidation, and energy sector reforms to ensure long-term stability. Additionally, the proposed Resilience and Sustainability Facility (RSF) aims to address climate vulnerabilities and promote green growth.
  • Pakistan's economy has shown signs of stabilization but continues to face significant challenges. After recording GDP growth of 2.5% in FY24, economic activity softened in the first half of FY25, with growth slowing to 1.3% in Q1 and 1.7% in Q2. This deceleration primarily reflects lower yields from major Kharif crops and persistently subdued industrial activity.
  • On the inflation front, headline inflation declined sharply to just 0.7% year-on-year in March 2025, driven by tight macroeconomic policies and declining global food and energy prices. However, core inflation remains stubbornly high at around 9%, indicating persistent underlying price pressures.
Economy: Historically, the Stock Market Recovers After Conflicts End - By AHCML Research

May 9 2025


Al Habib Capital Markets


  • When wars or tensions between India and Pakistan flare up, the stock market, especially Pakistan’s tends to drop sharply due to panic selling and foreign investor withdrawals. However, history shows that once the conflict ends and the risk of full-scale war fades, the market usually bounces back.
  • For example, after the 2001-2002 military standoff, PSX had crashed by 25%, but it recovered once troops withdrew. Similarly, in 2019, after the Balakot airstrikes, the market initially fell 5% but stabilized within weeks as tensions eased.
  • This pattern suggests that while geopolitical crises cause short-term volatility, markets often regain lost ground once stability returns. The recovery speed depends on the economy’s strength, the ongoing final meeting with IMF for USD1.3bn tranche after matching required condition from IMF we expect the market recover speedily. Longterm damage usually happens only if the conflict leads to sanctions or deep economic crises. In most cases, when the guns fall silent, investors return, and stocks climb back up.
Cherat Cement Company Limited (CHCC): Result Preview 3QFY25 - By AHCML Research

Apr 28 2025


Al Habib Capital Markets


  • Cherat Cement company limited is anticipated to report a PAT of PKR 1,512 million (EPS: PKR 7.78) for 3QFY25, reflecting an increase of 22% YoY supported by higher retention prices and improved cost efficiencies
  • Sales revenue for the quarter is expected to reach PKR 8,155 million, down 6% YoY, mainly due to decline in local and export dispatches.
  • Gross margins are estimated at 32%, up 2ppt YoY, primarily driven by lower fuel and coal prices as well as improved cost efficiencies. The company's investment in renewable energy has contributed to this margin expansion.
D.G Khan Cement Company Limited (DGKC): Result Preview 3QFY25 - By AHCML Research

Apr 25 2025


Al Habib Capital Markets


  • D.G Khan Cement company limited is anticipated to report a PAT of PKR 1,762 million (EPS: PKR 4.02) for 3QFY25, reflecting an increase of 49.26% YoY.
  • Sales revenue for the quarter is expected to reach PKR 19,147 million, up 34.21% YoY, supported by higher local and export dispatches.
  • Gross margins are estimated at 20.10%, down 5.4ppt YoY.
Indus Motor Company Limited (INDU): Result Preview 3QFY25 - By AHCML Research

Apr 24 2025


Al Habib Capital Markets


  • Indus Motor Company is anticipated to report a PAT of PKR 5,662 million (EPS: PKR 72.03) for 3QFY25, reflecting 27% YoY increase.
  • Sales revenue for the quarter is expected to reach PKR 61,256 million, reflecting a robust 29% YoY and 41.5% QoQ growth. This performance is primarily driven by a significant increase in volumetric sales, which rose by approximately 40% YoY and 42% QoQ
  • Fortuner Sales volume witnessed a substantial rise of 159% YoY and 110% QoQ, highlighting strong consumer demand and improved supply chain efficiency.
Faysal Bank Limited (FABL): 1QCY25 Result Preview - By AHCML Research

Apr 22 2025


Al Habib Capital Markets


  • Faysal Bank Limited is expected to report an EPS of Rs. 2.8, accompanied by a Rs. 1.5/share payout as the first interim dividend for CY25. We anticipate a 6% YoY increase in Net Interest Income (NII) for 1QCY25 compared to 1QCY24, driven by a lower cost of deposits amid a declining interest rate environment. However, on a QoQ basis, NII is expected to decline by 4% due to the lower policy rate translating into reduced markup income.
  • On the non-funded side, non-interest income is projected to grow by 36% YoY, supported by higher fee-based income and capital gains. Compared to the previous quarter (4QCY24), non-interest income is expected to rise by 6%.
  • Conversely, non-interest expenses are expected to surge by 50% YoY, in line with FABL’s branch expansion strategy and investment in digital infrastructure.
Maple Leaf Cement Factory Limited (MLCF): Result Preview 3QFY25 - By AHCML Research

Apr 21 2025


Al Habib Capital Markets


  • Maple Leaf Cement is anticipated to report a PAT of PKR 2,067 million (EPS: PKR 1.97) for 3QFY25, reflecting an impressive 83% YoY increase.
  • Sales revenue for the quarter is expected to reach PKR 16,711 million, up 5%YoY, supported by higher local and export dispatches.
  • Gross margins are estimated at 34.6%, up 6.6ppt YoY, primarily driven by lower fuel and coal prices as well as improved cost efficiencies. The company's investment in renewable energy—20 MW solar power projects and 37 MW capacity through the Waste Heat Recovery Power Plant (WHRP)—has contributed to this margin expansion.
Meezan Bank Limited (MEBL): Strong Upside Potential – Buy - By AHCML Research

Apr 8 2025


Al Habib Capital Markets


  • We initiate our coverage of Meezan Bank Ltd. (MEBL) with a Dec’25 Target Price (TP) of PKR 335, signifying a potential capital gain of 30.45%. The bank is also offering a healthy dividend yield of 9.76% (an expected dividend payout of PKR 25/share for CY25). The total return (capital gains + dividend) stands at an attractive 40.21%. MEBL is trading at a CY25 P/E ratio of 5.44x and a PBV of 1.62x.
  • Meezan Bank's stellar growth in recent years can be attributed to several factors: 1) Remarkable deposit growth averaging 24% since 2020, driven by rising consumer preferences for Islamic banking; 2) Meezan stands as a major beneficiary of capturing the Islamic banking market share due to its first-mover advantage; 3) The growing consumer interest in Islamic banking and the SBP’s plan to transform Pakistan’s banking system to align with Shariah principles will further propel Meezan’s growth trajectory. Additionally, other highlights include the lowest infection ratio, consumer ease, and improved asset quality with a high coverage ratio.
  • MEBL stands as Pakistan’s premier Islamic bank, delivering consistent growth, profitability, and resilience in an evolving financial landscape. Over the past five years, MEBL has demonstrated exceptional performance, with net interest income soaring from PKR 64.8bn in 2020 to PKR 287bn in 2024, driven by robust deposit growth and an expanding asset base. The bank’s efficiency has improved significantly, with its cost-to-income ratio declining to 26.78% in 2024, reflecting strong operational discipline. Net profit surged to PKR 102bn, while asset quality remains stable, supported by a prudent risk management framework.
Economy: Trade Tensions Trigger a Global Sell-Off - By AHCML Research

Apr 7 2025


Al Habib Capital Markets


  • Global stock markets tumbled after a surprise move by U.S. President Donald Trump, who announced new tariffs on imports, sparking fresh fears of a trade war. Countries like China responded with their own import duties, intensifying global tensions. Investors are now worried that escalating trade barriers could hurt global growth, profits, and jobs. Stock markets across Asia, Europe, and U.S. futures have all dropped sharply, as fear and uncertainty take the lead over company fundamentals. Markets are now in a wait-and-see mode, hoping for signs of de-escalation from world leaders.
  • The Pakistan Stock Exchange (PSX) has recently faced significant volatility, primarily influenced by escalating global trade tensions and domestic economic factors. The benchmark KSE-100 Index plummeted over 5%, triggering a temporary halt in trading. This sharp decline was largely a reaction to the U.S. government's implementation of new tariffs on imports, which unsettled global markets and prompted widespread investor concern.
  • The imposition of these tariffs has raised fears of a global trade war, adversely affecting investor sentiment worldwide. Pakistan, facing a steep 29% tariff on its exports to the U.S., is particularly vulnerable. In response, the Pakistani government announced plans to send a delegation to Washington to negotiate relief from these tariffs.