The KSE-100 index witnessed a slight pullback during the week, retreating after reaching its highest-ever closing in the previous week. The profit taking was driven by substantial selling from Insurance Companies, alongside month-end rollovers, which added to investor uncertainty. The KSE-100 index closed at 117,806pts, down by 635pts (0.54% WoW) compared to last week’s closing of 118,442 points. Additionally, ADTV. dropped by 38%WoW, clocking in at 317mn shares, compared to 508mn shares traded in the earlier week. However, several positive developments emerged during the week, as IMF confirmed reaching the Staff Level Agreement (SLA) with the authorities in the first review of EFF, supplemented with a 28-month arrangement of US$1.3bn under Resilience and Sustainability Facility (RSF), pending approval of the IMF’s Executive Board. On the macroeconomic front, GDP growth for 2QFY25 clocked in at 1.7%YoY, with Agriculture recovering by 1.1%YoY amidst a 5.4%YoY decline in crops growth. On the currency front, PkR largely remained flat against the greenback throughout the week, closing the week at 280.3.
Other major news flow during the week included, 1) IMF team due in May to finalize FY26 budget, 2) Govt to slash power tariffs soon, 3) Turkiye, Denmark to support climate fight, 4) Net metering contract term limited to 5 years, and 5) Pakistan receives US$9.77bn via RDA as of Feb’25. Sector-wise, Tobacco, Glass & Ceramics, and Vanaspati & Allied Industries were amongst the top performers, up 9.7%/2.3%/1.9%WoW, respectively. On the other hand, Leather & Tanneries, Paper & Board, and Technology & Communication were amongst the worst performers with a decline of 7.5%/4.5%/4.5%WoW. Flow wise, major net selling was recorded by Insurance Companies with a net sell of US$8.8mn. On the other hand, Individuals and Other Organizations absorbed most of the selling with a net buy of US$6.9/2.4mn, respectively. Company-wise, top performers during the week were, i) PAKT (up 8.1%WoW), ii) UBL (up 7.4%WoW), iii) ATLH (up 5.4%WoW), iv) NPL (up 5.3%WoW), and v) ABOT (up 4.3%WoW), while top laggards were, i) PKGP (down 11.9%WoW), ii) SRVI (down 10.8%WoW), iii) KTML (down 10.0%WoW), iv) CHCC (down 9.9%WoW), and v) NML (down 6.4%WoW).
Outlook
The market is expected to remain positive in the coming weeks, with the recent announcement of a staff-level agreement serving as a key trigger for momentum. The KSE100 is anticipated to sustain its upward trajectory, with a target of 165,215 points by Dec’25, primarily driven by strong earnings in fertilizers, sustained ROEs in banks, and improving cash flows of E&Ps and OMCs, benefiting from falling interest rates and economic stability. Our top pick includes, OGDC, PPL, PSO, FFC, ENGROH, MEBL, MCB, HBL, LUCK, FCCL, INDU, ILP and SYS.
Courtesy – AKD Research
