External broker reports(aggregated public sources), Topline Securities

Topline Securities

External broker reports(aggregated public sources)

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Equity Bottom-Up

Pak Elektron Limited (Pael) / Equity Bottom-Up

<ul>
<li>We reiterate our ‘Buy’ stance on Pak Elektron (PAEL), Pakistan's one of the biggest home appliance and power equipment manufacturers, despite its weak performance in 1Q2018 (owing to strategic reasons to some extent while increasing competition also affected sales).</li>
<li>After incorporating 1Q result, we tweak our assumptions for PAEL and tone down its EPS estimates by 15/22/32% to Rs5.3/6.0/6.3 in FY18E/FY19F/FY20F.</li>
<li>However, since the stock has come down 18/65% in 2018/FY18YTD and has underperformed…</li>
</ul>


We reiterate our ‘Buy’ stance on Pak Elektron (PAEL), Pakistan's one of the biggest home appliance and power equipment manufacturers, despite its weak performance in 1Q2018 (owing to strategic reasons to some extent while increasing competition also affected sales).
After incorporating 1Q result, we tweak our assumptions for PAEL and tone down its EPS estimates by 15/22/32% to Rs5.3/6.0/6.3 in FY18E/FY19F/FY20F.
However, since the stock has come down 18/65% in 2018/FY18YTD and has underperformed…


Thematic (Sector/Industry)

<ul>
<li>As per news reports, the Economic Coordination Committee (ECC) of the cabinet has given approval to implement additional duties in the range of 5%-15% on import of non-essential items. As reported, these are expected to include used cars, tyres, mobile phones, select consumer items, tiles, electronic goods (other than computers) and garments etc. The detailed list of these items is pending review and will be finalized.</li>
<li>Pakistan posted glaringly high imports of US$48.6bn during FY17 (up 17.8%)…</li>
</ul>


As per news reports, the Economic Coordination Committee (ECC) of the cabinet has given approval to implement additional duties in the range of 5%-15% on import of non-essential items. As reported, these are expected to include used cars, tyres, mobile phones, select consumer items, tiles, electronic goods (other than computers) and garments etc. The detailed list of these items is pending review and will be finalized.
Pakistan posted glaringly high imports of US$48.6bn during FY17 (up 17.8%)…


Pakistan Economy: Additional Import Duties and Export Package Approved

We reiterate our ‘Buy’ call on PAEL, as the stock offers best exposure to Pakistan’s appliances and power sector with an upside potential of 48%. Our liking for the stock stems from:<ol><li>strong growth in appliances segment due to improved energy situation, rising income levels and company’s expansion plans;</li><li>power division placed to gain from improving power generation to bridge 4,000-5,000MW energy shortfall through projects under flagship China Pakistan Economic Corridor (CPEC) implementation; and</li><li>attractive valuation.</li></ol>

We reiterate our ‘Buy’ call on PAEL, as the stock offers best exposure to Pakistan’s appliances and power sector with an upside potential of 48%. Our liking for the stock stems from:strong growth in appliances segment due to improved energy situation, rising income levels and company’s expansion plans;power division placed to gain from improving power generation to bridge 4,000-5,000MW energy shortfall through projects under flagship China Pakistan Economic Corridor (CPEC) implementation; andattractive valuation.

Pak Elektron (PAEL): Well Positioned Business Mix to Benefit

Pakistan

Pak Elektron Limited manufactures and sells electrical capital goods and domestic appliances primarily in Pakistan. It operates in two divisions, Power and Appliances. The Power division manufactures and distributes transformers, switchgears, energy meters, and power transformers; constructs grid stations; and provides electrification works. The Appliances division manufactures, assembles, and distributes refrigerators, deep freezers, air conditioners, microwave ovens, washing machines, water dispensers, and other home appliances. The company also exports its products to Qatar, Afghanistan, Zimbabwe, Yemen, Greece, Swaziland, Saudi Arabia, Tanzania, Kazakhstan, Bangladesh, Nepal, and Kenya. Pak Elektron Limited was founded in 1956 and is based in Lahore, Pakistan.

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Pak Elektron Limited (Pael) (PAEL PA)

Pak Elektron (PAEL) : Reiterate Buy

We reiterate our ‘Buy’ stance on Pak Elektron (PAEL), Pakistan's one of the biggest home appliance and power equipment manufacturers, despite its...

Topline Securities

Pakistan Economy: Additional Import Duties and Export Package Approved

As per news reports, the Economic Coordination Committee (ECC) of the cabinet has given approval to implement additional duties in the range of...

Topline Securities

Pak Elektron (PAEL): Well Positioned Business Mix to Benefit

We reiterate our ‘Buy’ call on PAEL, as the stock offers best exposure to Pakistan’sappliances and power sector with an upside potential of 48%....

Topline Securities

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