Iran Capital Market YTD Return Placed First
* Stocks accelerating price growth over the past month (22 Nov.- 23 Dec.) put the overall index YTD return at 23.7%, making Iran Capital Market in general and the stock market in specific as the top investment alternative in the country; this growth is mostly attributed to global commodities and Forex price roar; this market has also posted an 11.3% growth over the fall. Although in this regard, the All-Share index registering record highs along with the Central Bank of Iran severe regulation over lowering the interest rate should not be underestimated. All in all, 27 listed sectors experienced growth over the said period led by IT & Communication space (30.1%), followed by Iron Ore, Paper Products and Metals groups with 21.2%, 17.8% and 15.6%, respectively. Chemicals and Oil Products space also posted 7.9% and 6.6% growth as well.
* Via a directive implemented from December 30th, the Securities & Exchange Organization (SEO) of Iran forbids the release of listed companies’ annual budget performance and obliges the issuance of management evaluation reports to move investors towards a more analysis-based trading method. According to this directive, companies are required to release their quarter performance reports along with management evaluation reports, which will provide investors with a better view of the companies’ future considering the effective variables and events.
In the Market
Commodities, i.e. copper and zinc prices reached $7150 and $3250 and crude oil is trading at $58.5, which again attracted investors’ attention towards the related industries. Except from a few names notching beneath their flat lines, the whole Metals space ended with good gains. Having received the permission for the 322% capital raise based on asset revaluation, Esfahan Steel (ZOBZ1) Company’s board of directors has proposed another 22% capital raise based on shareholders’ paid in capital and claims due to the extraordinary GM; it will seek goals like financial restructuring and working capital provision.
Similar sentiment was seen in the Iron Ore group as well, led by Mines and Metals Development (MADN1).
The whole Oil Products space also finished the session with good gains. Iran and Brazil agreed to build an oil refining company soon.
Following the government proposal on vehicle import tariff rise up to 150%, the Automotive space went through positive trades, led by Iran Khodro (IKCO1) and Saipa (SIPA1). Iran Automobile Spare Parts (GHAT1) was the top gainer.
Symbols in the Cement space settled with moderate trades; while Tehran (STEH1) and Lar-e Sabzevar (SBZZ1) Cement faced buy queues, Kurdistan (SKOR1) and Khuzestan (KHOC1) Cement wnt through sales pressure. Fars and Khuzestan Cement (SFKZ1) has reduced its EPS for the next FY from IRR 127 to IRR 114, only covering IRR 1 over its H1 performance.
A positive sentiment dominated the Chemicals group, led by Kharg Petrochemical (PKHA1); Having applied a 14% positive EPS adjustment, PKHA1 ticker returned to the market 15% higher at IRR 19,995.
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