Harmony Between Iran Debt Market & Iran Banking Sector!
– Going under pressure to stop the issuance of Islamic Treasury Bills since late last year, the Iran Debt Market started to see the re-entrance of such securities since September this year. On Saturday, the Iran Fara Bourse hosted IRR 9,000 bn worth of bills with a YTM of circa 15%. It seems that the Central Bank of Iran’s directive on lowering interest rate on bank deposits followed by strict supervision and precision in defining new rates has now hit the Iran Debt Market. The harmony between interests offered by the money and debt markets contains two hidden messages: one refers to the opportunity it offers to deepen the Iran Debt Market by more supply and the other deals with the positive effects of lower interest rates on other markets, which has the potential to turn the stock market into a more attractive one for fresh money.
– The Minister of Economic Affairs and Finance has submitted a proposal on a swap deal to settle government outstanding debt by and between the government, banks and private contractors to the Planning and Budget Organization of Iran, which will be in line with the issuance of Islamic Treasury Bills started 2 years ago. As the result, the government will swap its outstanding debt to private contractors along with private companies swapping their debts to banks with eventually, swap of the banks’ debt to the government.
In the Market
The majority of names in the Oil Products space saw a rise in demand right from the start led by Lavan Oil Refining (PNLZ1, +4.99%, IRR 14,635) mostly after the news broke out that products would be exported at open market USD/IRR on Saturday settled with moderate gains.
A rather negative sentiment dominated the Other Financial Intermediaries group. With its 200% capital raise plan rejected by the SEO, Rayan Saipa Leasing (RSAP1, -1.13%, IRR 1,230) is now allowed to increase its current IRR 4520 bn by 100%; the share also ended beneath its flat line, leading the whole sector.
The approved 8% rise in sugar prices directed attention to the Sugar group. Trading at 3% area, Qazvin Sugar (GGAZ1, +3.15%, IRR 4,754) was named as the highest volume traded share. Chahar Mahahl Sugar (CHRZ1, -4.96%, IRR 7,024), however, faced a sell queue.
In its projections, Shiraz Petrochemical (PRZZ1, +2.48%, IRR 14,534) has announced to make IRR 45 EPS for the FY ending March 2018, compared to its previous IRR 53 EPS (15% down); the company has made IRR 222 loss per share in the first half. This resulted in the halting of the ticker after hitting its high at IRR 2,795. Except from Nirouchlor (NKOL1, +4.71%, IRR 3,889) which rose nearly by 5%, the rest of the Chemicals group went through balance trades.
Despite unofficial news on the changing of Saipa’s CEO by the Ministry of Mines, Trade and Agriculture, such a change was not addressed officially when the market started, although it was confirmed by an official in the company itself and by the ministry later. Besides, divesting Saipa Ben Ro site to Renault Company seems to be cancelled, which has ended in officials in the Industry, Mines and Agriculture Ministry taking a trip to France for negotiation. During today’s session, a large number of companies in the Automotive industry shed their prices.
DISCLAIMER: This report has been prepared and issued by Agah Brokerage Firm on the basis of publicly available information, internally developed data and other sources believed to be reliable. The information contained herein is not guaranteed, does not purport to be comprehensive and is strictly for information purposes only. Agah does not assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions. Any expressions of opinions are subject to change without notice.
To contact reporters: Inter@agah.com