The continuous price appreciation in share market helped the badla rates to enter the double-digit zone where values changed hands and crossed the coveted mark of Rs 25 billion, touching almost seven-month high level.
The weighted average badla rate reached 12 percent on Friday (April 2), a rise of 2.4 percent over 9.6 percent on last Friday (March 26).
Badla rates reached double digits last week after a gap of five weeks. This rise in the badla rate can be attributed to rising share prices and slightly higher badla volumes that have reached 479.4 million shares at KSE and 77.3 million at LSE at the weekend.
At LSE, the weighted average badla rate was 13.4 percent last weekend (April 2) versus 9 percent over previous weekend.
Last week total badla investment crossed Rs 25 billion for the first time since September 2003.
In September 2003 when badla investment was over Rs 25 billion, weighted average badla rate was above 18 percent.
Moreover, OGDC was not part of the market in September 2003, but it is now one of the more active stocks in CoT.
Therefore, traders feel that in relative terms, investors are less leveraged as compared to September 2003.
The total badla investment at KSE reached Rs 24.9 billion, indicating an increase of Rs 133 million over previous weekend.
At LSE, total badla investment reached Rs 3.2 billion, while on previous weekend it was at Rs 2.9 billion.
Total badla investment at KSE and LSE combined reached Rs 28.1 billion on weekend. This indicates a rise of Rs 0.5 billion over previous weekend.
With KSE-100 index comfortably staying over 5,000 level, a few scrips are making exceptional surge, resulting in increased leveraged position in those scrips. If there is further consolidation or correction, and considering the liquidity in the hands of badla financiers, it is expected that badla rates may come down in future.
Among the heavily traded scrips in percentage and absolute terms, substantial decline was witnessed in the shares of D.G. Khan Cement.
The total business of the cement company declined by 19.23 percent to Rs 254 million to Rs 1,069 million from Rs 1,324 million reported on Thursday. Other heavyweights that followed this trend included PTC, Sui Northern Gas and WorldCall.
The business in these scrips reduced by Rs 133.47 million, Rs 127.93 million and Rs 84.64 million, respectively.
On the other hand, notable increase was witnessed in the energy giant Pakistan State Oil (PSO) and Pakistan Oilfields that climbed by 317.91 million or 11.45 percent and Rs 317.26 million or 11.90 percent respectively.
Nearly all the scrips which are in demand traded in double digit charges, except PSO, PTC, Hubco, D.G. Khan Cement and WorldCall which traded at 8.41 percent, 7.85 percent, 9.78 percent, 6.69 percent and 8.20 percent, respectively.
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