Sui Northern Gas Pipelines Limited (SNGP): FY24 Corporate Briefing Takeaways - By Taurus Research

Jun 5 2025

Taurus Securities

• SNGP, largest integrated natural gas utility in Pakistan, posted a record profit of ~PKR 18.97Bn in FY24, supported by all-time high sales of ~PKR 1Bn.

• Pakistan’s energy mix includes 30% natural gas (69% from SNGP, 31% from SSGC), 11% RLNG, 21% oil, 15% coal, 12% hydropower, 7% nuclear, and 4% from LPG and renewables combined.

• SNGPs ownership is split between 32% direct and 42% indirect Government holding, with the remaining 26% held by the public and others.

Autos: May-2025 sales to record highest levels since Dec-2022 - By JS Research

Jun 5 2025

JS Global Capital

• We preview automobile sales volumes for May-2025, expecting the three major players including Indus Motors Company Ltd (INDU), Honda Atlas Cars Ltd (HCAR), and Pak Suzuki Motor Company Ltd, representing 84% of the four-wheeler market, to post a major volumetric growth of 44%/49% YoY/MoM, reaching ~13.3k units.

• INDU and HCAR are expected to lead monthly growth with volumes up 2.4x and 69% YoY, respectively. The 49% MoM increase is largely due to delivery delays led by protest on highways over canal projects. Overall, we anticipate a 38% YoY growth for our sample in 11MFY25.

• We highlight key risks in the FY26 budget to include a potential carbon tax on petrol vehicles, reduced average tariffs on imported cars, extension of used car import age limit from 3 to 5 years, and higher sales tax on vehicles up to 800cc – all of which could significantly impact the auto industry sales.

Economy: Pre-Budget FY26 Market Sentiments - By Chase Research

Jun 5 2025

• Chase Securities conducted a pre-budget survey in the run up to the annual budget announcement.

• A total of 44 participants provided their insights on key issues.

• We believe that these insights are key to identifying market sentiments and gauging the confidence in the equity market.

• 27% of the participants expect KSE-100 to be above 150,000 points by the end of June 2026.

Technical Outlook: KSE-100; Upside to continue - By JS Research

Jun 5 2025

JS Global Capital

• Bulls continued to dominate the session as the KSE-100 Index gained 1,348 points DoD, closing at the 121,799 level. Trading volumes stood at 711mn shares, up from 578mn shares previously. We believe a break above 121,882 (yesterday’s high) will sustain the uptrend, with 123,375 and 125,947 as the next targets. On the downside, support is seen between 120,900 and 121,170, with a break below this range likely to trigger a corrective phase. Both the RSI and MACD are trending upward, reinforcing a positive outlook. We recommend investors 'Buy on dips,' while keeping a stop-loss below the 120,896 level. The support and resistance are at 121,169 and 122,155, respectively.

Morning News: Pakistan, ADB sign $300m ‘Subprogram II’ loan - By WE Reserach

Jun 5 2025

• The government of Pakistan and the Asian Development Bank (ADB) have signed a $300 million loan agreement under the “Improved Resource Mobilization and Utilization Reform Programme (Subprogramme-II),” aimed at supporting Pakistan’s macroeconomic stabilization and fiscal consolidation through structural reforms in trade, revenue generation, and capital market development. The agreement, signed by Dr. Kazim Niaz and ADB Country Director Emma Fan, is part of a broader $800 million financing package that includes a $500 million Policy Based Guarantee (PBG) to help raise $1 billion in commercial financing, reinforcing Pakistan’s efforts toward economic recovery and sustainability.

• At a lively early Independence Day celebration hosted by the US Embassy in Islamabad, Prime Minister Shehbaz Sharif announced a “new era” in US-Pakistan relations, emphasizing shared democratic values and historical ties dating back to 1947. Speaking to a crowd of political leaders, diplomats, and civil society members, Sharif acknowledged America’s longstanding development support while highlighting Pakistan’s heavy sacrifices in the fight against terrorism—over 90,000 lives lost and $150 billion in economic damage. He also criticized India over a recent conflict, calling the Pahalgam incident a false-flag operation and accusing New Delhi of civilian targeting, while affirming Pakistan’s military response. Despite tensions, Sharif expressed a desire for regional peace and praised former US President Trump for his role in de-escalating hostilities. Acting US Ambassador Natalie Baker echoed the spirit of partnership, speaking in Urdu and highlighting shared values and mutual respect.

• Pakistan’s finance team is in negotiations with the International Monetary Fund (IMF) to maintain the current 5% Federal Excise Duty (FED) on fertilisers and drop a proposed 5% FED on pesticides in the 2025–26 budget, following intervention by Prime Minister Shehbaz Sharif. The Prime Minister has also directed the Federal Board of Revenue (FBR) to reassess the proposed import tariff rationalisation plan to prevent negative impacts on the import bill. While the IMF appears to have relented on fertiliser and pesticide taxes after Pakistan argued these could hurt agricultural productivity—especially alongside the introduction of the Agriculture Income Tax (AIT)—it remains firm on imposing General Sales Tax (GST) in the formerly exempt FATA/PATA regions. Despite previous political efforts to preserve the exemption, a reduced GST rate of 12% is now expected to be implemented there in the upcoming fiscal year.

Morning News: IMF wants ‘strict compliance’ as budget enters final stages - By Vector Research

Jun 5 2025

Vector Securities

• Amid final consultations on the budget, the International Monetary Fund (IMF) wants strict compliance with programme requirements, including the coverage of agriculture income tax in provincial budgets to ensure effective collection starting no later than September 2025. The Fund also does not agree with a plan for incentivising enhanced power consumption desired by the federal government to absorb surplus capacity.

• The government of Pakistan and Asian Development Bank (ADB) on Wednesday signed a $300 million loan agreement for the “Improved Resource Mobilization and Utilization Reform Programme (Subprogramme-II).

• The National Economic Council (NEC) under the chairmanship of Prime Minister Shehbaz Sharif, Wednesday approved the national development outlay of Rs4.224 trillion (Rs4,224 billion), including federal Public Sector Development Program (PSDP) of Rs1,000 billion for the next budget. The real GDP growth has been envisaged at 4.2 per cent of GDP and CPIbased inflation at 7.5 per cent for FY2025-26.

Cement: May'25 local offtakes reach 21-month high amid improvement in construction activity - By AKD Research

Jun 4 2025

AKD Securities

• Cement dispatches for May’25 clocked in at 4.65mn tons, an increase of 9%YoY, driven by 9%YoY surge in local offtakes, while exports increased by 7%YoY.

• Industry-wide capacity utilization increased to 66% (up 4.6ppt YoY), highest in 21 months.

• We maintain a positive outlook on the sector on the back of anticipated gross margin expansion due to improvement in retention prices and declining power cost, supported by declining interest cost.

Fertilizers: Slight demand pick-up ahead of the Budget - By JS Research

Jun 4 2025

JS Global Capital

• As per provisional figures, Urea off-take during May 2025 is expected to clock in at 420k tons, up 6% YoY/67% MoM. This marks the first YoY growth in Urea sales volumes after a sustained period of weak performance since CYTD. While DAP volumes likely to arrive at 94k tons (+2.3x YoY). CYTD urea/ DAP sales are likely to post 31%/20% YoY decline.

• Company-wise, Fauji Fertilizer Company (FFC) is expected to post Urea off-take of 206k tons in May-2025, down 28% YoY. In contrast, Engro Fertilizers (EFERT) is expected to post 86% YoY growth reflecting a low base-effect, while the company is also expected to surpass the CYTD monthly run-rate.

• Urea inventory is expected to reach an 8-year high of 1.3mn tons in May-2025, similar to the levels seen during the same month in 2017/ 2020, which were later offloaded due to exports / strong sales in latter months. Although the chances for govt allowing exports are low at this point, however, any such allowance would favor EFERT more than the peers.

Refinery: GRMs Sharply Recovering - By Sherman Research

Jun 4 2025

Sherman Securities

• After plunging to lowest level of US$4.5 per barrel in April 25, Gross Refining Margins (GRMs) of local refineries significantly recovered to US$9.3 per barrel during ongoing month of June. This is positive for local refineries as their earnings are directly linked with changes in GRMs.

• Just to recall, highest GRM was recorded at US$30 per barrel during July 2022 while average GRMs during last 5 years stood at US$7 per barrel.

• GRM is the sum of the weighted average spread of products which a refinery is yielding on every barrel of crude it processes. Major products include Diesel (HSD), Gasoline (MS) and Furnace oil (FO).

Cement: May’25 dispatches up 39%MoM - By Taurus Research

Jun 4 2025

Taurus Securities

• Total Cement dispatches in May’25 up 39%MoM on the back of reviving construction demand i.e. Domestic sales went up 46% MoM to 3.6Mn tons. Whereas, total export sales up 20%MoM on account of better retention prices and surge in demand post Indo-Pak de-escalation which benefited North Players, mainly. On a YoY basis, total domestic sales were up 9% in May’25 as lower interest rates and record low inflation have supported players to improve their margins and increased volumes. Although, higher duties and taxes on the cement sector have reduced the overall demand, resulting in overcapacity.

• North-based domestic sales increased 42%MoM in May’25 due to surge in the construction activities amid seasonal demand and better volumes i.e. lower retail prices compared to the South region. Wherein, export sales were up significantly by 1.1xMoM on the revival of regional sales post Indo-Pak deescalation. South-based domestic sales surged by 64%MoM in May’25 amid revival of the construction demand. On the export front, South-based exports were up 5%MoM, respectively.

• On a YoY basis, North-based domestic sales surged 10%YoY in May’25 due to pick up in construction demand on the back of lower interest rates and record low inflation. Similarly, Northbased exports were up significantly by 48%YoY, reflecting higher demand from the export regions. On the South front, domestic sales during May’25 increased by 5%YoY. However, export sales dropped 2%YoY to 0.75Mn tons, respectively.