KARACHI: The benchmark KSE-100 of Pakistan Stock Exchange gained 4,555 points during the March 2025, closing at 117,807 points level.
According to AHL Research, during Mar’25, the KSE-100 index remained upbeat, hitting an all-time intraday high of 119k points, fuelled by optimism over Pakistan’s $1.0 billion IMF staff-level agreement under the EFF, pending Executive Board approval. Additionally, a $1.3 billion RSF arrangement was also secured.
Positive sentiment was further fuelled by anticipation of circular debt resolution. Moreover, the IMF approved a FY25 tax target revision to PKR 12.3trn (from PKR 12.97trn), as per media. However; some profit taking, proposal of cement royalties in KPK and IMF concerns over tariff adjustments limited gains.
Pakistan’s GDP grew 1.73 percent YoY in 2QFY25, with 1HFY25 growth at 1.54 percent vs 2.33 percent in 1HFY24.
The SBP reserves stood at $10.6 billion, depicting a significant decline of $642.7 million compared to last month. Finally, the market closed at 117,807 points, depicting a massive gain of 4,555 points or 4.0 percent MoM.
Major News for the month included, Pakistan’s petroleum sales depicted a growth of two percent YoY while declined by 18 percent MoM to reach 1.14 million tons in Feb’25, Cement sales improve by 7 percent YoY in February, Urea and DAP sales in Feb’25 plunge by 36 percent and 65 percent YoY, respectively, Car sales rise by around 25 percent in Feb and Pakistan’s power generation drops 15 percent in February.
In addition, Pakistan’s textile exports remain flattish YoY, down 16 percent MoM, Mari Energies begins production from Shewa discovery in Waziristan Block, Punjab CM launches free tractor scheme, Mari Energies makes second gas and condensate discovery at Spinwam-1 well, Big Bird Foods to install 3MW solar power system, Amreli Steels extends suspension of operations at SITE Rolling Mill, Engro completes divestment of Eximp Agri products for Rs2.4 billion, Haleon Pakistan ships first Centrum consignment to Kenya and SBP approves SILK merger with UBL.
Analysts at AHL Research expecting that market to be remain positive in the upcoming month, continuing the robust sentiment witnessed post SLA between Pakistan and IMF and signing of new RSF program towards end of Mar’25. Furthermore, the result season is expected to commence from next month, where certain scrips are anticipated to be in the limelight amid the expectation of better financial results.
Moreover, headline inflation for Mar’25 is expected to drop to a 59 year low of 0.79 percent YoY (lowest inflation reading since Dec’65). The recent monthly back-to-back low YoY inflation readings are mainly a result of the high base effect, coupled with a drop in food and housing indices. Furthermore, if global commodity and energy prices stay stable and the PKR maintains its strength, it will further support the inflation outlook, helping to keep price pressures under control.
The KSE-100 is currently trading at a PER of 6.4x (2025) compared to its 10-year average of 8.0x offering a dividend yield of ~8.2% compared to its 10-year average of ~6.5%. Our preferred stocks are PSO, OGDC, PPL, FFC, FCCL, MLCF, LUCK, NBP, AKBL, HUMNL, SYS, AIRLINK and HTL.
Copyright Business Recorder, 2025
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