November 6, 2020 (MLN): Pakistani stocks made headlines across the globe after they posted the highest returns during the quarter ended September 30, 2020, thereby leading markets all over the world. But after reviewing the financial performance of the companies listed on the KSE-100 index, it turned out that the benchmark index also witnessed one of its best performances so far in terms of earnings, which grew by 51.6% as compared to the previous quarter and 38% as compared to the same period of last year.
It is pertinent to note here that the analysis is based on the performance of 89 companies which represent almost 95.4% of the total market capitalization of the KSE-100 index. The remaining 11 companies haven’t disclosed their financial results yet.
According to a report by Arif Habib Limited, the tremendous growth in quarterly earnings was led by Commercial Banks, Fertilizer, and Power Generation Sectors as they posted profits of PKR 68.9 billion (+53.8% YoY), PKR 30.2bn (+84.3% YoY), and PKR 14.8 billion (+27.5% YoY), respectively. On the other hand, the earnings of E&P witnessed a decline of 4.8% YoY to settle at PKR 50.5 billion.
During the nine months ended September 30, 2020, the earnings of the benchmark index increased by around 4% owing to the remarkable performance delivered by Commercial Banks, Fertilizer, and Power Generation, as they posted profits of PKR 183 billion (+47.5% YoY), PKR 58 billion (+23.6% YoY) and PKR 42 billion (+62.8%), respectively. However, the growth in earnings was restricted by the performance of E&Ps, as it saw a decline of 12.6% in earnings.
In terms of the highest growth, the chart during 9MCY20 was led by sectors such as Investment Banks (+234% YoY), Vanaspati and Allied (+111%), Power Generation (+63% YoY), Tobacco (53% YoY), and Pharma (+51% YoY). During 3QCY20, Cable & electrical goods (+892% YoY), Tobacco (+822% YoY), and Investment Banks (+385% YoY) led the earnings jump of the index.
Similarly, in terms of total points contributed to the index, Commercial Banks (+1,521), Cement (+977), Oil & Gas Marketing Companies (+425), Technology & Communication (+421), and Textile Composite (+322) led the indices. Company-wise, the scrips of HBL (+557), LUCK (+538), TRG (+248), POL (+205) and, PSO (+199) accounted for the most points gained during the quarter, while the shares of OGDC (-80), PSEL (-19), PMPK (-9), SHFA (-9), and JDWS (-6) turned out to be the most disappointing ones.
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