Karachi: Habib Bank Ltd (HBL) is scheduled to announce its full-year CY11 result on Friday, Feb 24’12. According to AKD Securities, on a consolidated basis, AKD Securities expects HBL to post NPAT of PkR21.6bn (EPS: PkR19.60) in CY11 against NPAT of PkR17.0bn (EPS: PkR15.46) in CY10, translating into robust growth of 27%YoY. In doing so, HBL should become the most profitable bank in Pakistan in terms of absolute NPAT.
However, 4QCY11 NPAT is expected to dip by 26%QoQ to PkR4.9bn (EPS: PkR4.47) due to a likely contraction in Nil (tighter NIMs in lower interest rate environment) and a sequential spike in loan provisions. That said, upside risk to AKD Securities’ 4QCY11 estimates stems from potential low loan provisions (FSV benefit enhanced in Oct’11) and potential realization of gains on securities (primarily equities). Alongside the result, AKD Securities expects HBL to announce a final cash dividend of PkR4/share (bringing full-year CY11 payout to PkR7/share), as well as a 10% bonus issue. Key highlights for CY11E are expected to be 1) 16%YoY Nll growth, 2) 8%YoY increase in loan provisions, 3) 25%YoY increase in non interest income on higher dividend & fx income and 4) relatively high admin expense growth of 20%YoY despite completion of the prolonged VSS program.
Having gained 11.7%CYTD, HBL trades at a CY12F P/B of 1.0x and PER of 6.1x where AKD Securities’ target price of PkR130/share offers upside of 9.7% and implies an Accumulate stance. That said, AKD Securities will look to revisit AKD Securities’ investment case post release of CY11 accounts.
PTC: 1HFY12 Result Preview
PTC will be announcing its 1HFY12 results tomorrow. AKD Securities expects consolidated 1HFY12 earnings to fall by 26%YoY to PkR4.3bn (EPS: PkR0.85). Sequentially, earnings are forecast to fall by 6%QoQ to PkR2.1bn (EPS: PkR0.41). Despite an expected 6%YoY growth in consolidated revenues, 1HFY12 earnings are likely to fall on i) lower margins (GM down 60bps YoY), ii) lower other income (-45%YoY) and iii) higher financial charges (+34%YoY to PkR1.6bn), particularly in 2QFY12 due to volatility in PKR. On a standalone basis, 1HFY12 earnings are estimated to stand at PkR2.8bn (EPS: PkR0.54) depicting a fall of 31%YoY, while for 2QFY12, earnings are expected to remain relatively flat (-1.3%QoQ) at PkR1.4bn (EPS: PkR0.27). AKD Securities does not expect any cash payout with the result. At current levels, AKD Securities reiterates AKD Securities’ Buy call on PTC which provides an attractive upside of 53% to AKD Securities’ target price of PkR18.2, while is trading at consolidated FY12 PER and PBV of 5.8x and 0.5x.