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Morning Call about – 1) Auto sales down 22% MoM 2) MCB to post EPS PKR 11.08 in 1H – Arif Habib Limited

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by August 15, 2013 Brokerage

Karachi, August 15, 2013 (PPI-OT): 1) Auto sales down 22% MoM in Jul’13 Pakistan Automotive Manufacturers Association (PAMA) released the latest auto sales and production figures for Jul’13.

According to Arif Habib Limited volumes showed car and LCV sales plunged 22% MoM in Jul’13, however, on YoY basis, car and LCV sales posted 7% growth in Jul’13. Segment-wise break-up revealed 1000-1300cc segment dropped 12% MoM. Subsequently, the economy segment (below 1000cc) and the high-end segment (+1300cc) witnessed a decline of 25% MoM and 23% MoM, respectively. The huge decline on MoM basis across the entire sector was mainly due to additional tax measures imposed on the Auto sector effective Jul’13 onwards.

Pak Suzuki Motor Company’s (PSMC) sales dropped 23% MoM to 9,733 units. On YoY basis, PSMC posted huge jump of 102% YoY. This huge growth on YoY basis was due to the low-base effect of last year when PSMC sales dropped after Jun’12 (the last delivery month of CNG-fitted vehicles and Punjab gov’t taxi scheme). Indus Motor Company Limited’s (INDU) sales tumbled with 21% MoM and 13% YoY in Jul’13 to 2,894 units. Furthermore, Honda Atlas Cars Pakistan Limited (HCAR)’s sales also showed a decline of 21% MoM in Jul’13 to 1,962 units, however, on YoY basis, the company sales registered 19% jump in Jul’13.

Tractors’ sales during Jul’13 also recorded a 79% MoM decline to 1,302 units. Millat Tractor’s sales plunged 79% MoM in to 1,308 units, followed by Al-Ghazi Tractors recording a massive 61% MoM drop to 578 units in Jul’13.

data                    Jul-13    Jun-13    MoM    Jul-12   YoY
1300cc and above        4,775     6,235    -23%    4,823    -1%
1000cc                  1,225     1,394    -12%    1,135     8%
<1000cc                 2,299     3,070    -25%    2,276     1%
Total cars              8,299    10,699    -22%    8,234     1%
LCV's + 4x4             2,325     2,758    -16%    1,636    42%
Total                  10,624    13,457    -21%    9,870     8%
Company wise           Jul-13     Jun-13    MoM    Jul-12    YoY
PSMC                   9,733      12,290   -21%    4,823    102%
INDU                   2,894       3,768   -23%    3,315    -13%
HCAR                   1,962       2,392   -18%    1,650     19%
Source: PAMA

2) MCB to post EPS of PKR 11.08 in 1HCY13
MCB’s board meeting is scheduled to be held on 16th August, 2013. Arif Habib Limited expects the bank to report net income of PKR 11,217mn (EPS: PKR 11.08) in 1HCY13 compared to PKR 11,252mn (EPS: PKR 11.12) in the corresponding period last year.

This marks a minor -0.3% YoY decline in the overall earnings of the bank in 1HCY13. During the period, the bank’s non-funded income is expected to witness a decline of 11.8% YoY to PKR 4.6bn compared to PKR 5.2bn in 1HCY13.

A minor decrease of 0.5% YoY in administrative cost is expected to reach PKR 8.3bn in 1HCY13. Arif Habib Limited expects MCB to announce an interim dividend of PKR 4.0/share in 2QCY13 to take the total payout for 1HCY13 to PKR 7.50.The scrip is trading at an industry high CY13E P/BV and P/E of 2.57x and 13.88x, respectively.

Financial Highlights (PKR mn)      2QCY13E   1QCY13   QoQ    1HCY13E   1HCY12     YoY
Interest income                     17,063   16,715   2.1%   33,779    34,492   -2.1%
Interest expense                     6,490    6,993  -7.2%   13,483    13,587   -0.8%
Net Interest Income                 10,573    9,723   8.7%   20,296    20,905   -2.9%
Prov. against NPLs                    (66)    (811) -91.9%    (877)       408 -315.1%
Non Interest income                  2,231    2,350  -5.1%    4,582     5,195  -11.8%
Administrative Exp.                  4,240    4,038   5.0%    8,278     8,323   -0.5%
Profit Before Tax                    8,384    8,677  -3.4%   17,061    17,146   -0.5%
Net Income                           5,449    5,768  -5.5%   11,217    11,252   -0.3%
EPS (PKR)                            5.38     5.70   -5.5%   11.08     11.12    -0.3%
DPS (PKR)                            4.00     3.50            7.50      7.50
Source: Company Accounts, AHL Research

The post Morning Call about – 1) Auto sales down 22% MoM 2) MCB to post EPS PKR 11.08 in 1H – Arif Habib Limited appeared first on AsiaNet-Pakistan.

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