Tehran Stock Exchange over April-May 2017!
According to the latest reports by the Securities and Exchange organization, the total market cap of Tehran Stock Exchange and Iran Fara Bourse issuers break the cap of USD 88 bn over the April-May of 2017. The average P/E ratio of the market is now hovers around 6.96. The top 10 companies with highest market cap are:
- Persian Gulf Petrochemical: USD 5,957 nm
- MCI: USD 3,837 mn
- TCI: USD 3,518 mn
- Isfahan Mubaraka Steel: USD 2,709 mn
- National Copper Industries: USD 2,578 mn
- Jam Petrochemical: USD 2,399 mn
- MAPNA Group: USD 2,200 mn
- Tamin Petrochemical: USD 2,179 mn
- Ghadir Investment: USD 2,137 mn
- Bandar Abbas Oil Refinery: USD 1,911 mn
Unprecedented events of Iran Economy!
The first cabinet meeting of Persian new year (1396) held the other day with president Rohani pointing out the three unprecedented events in Iran Economy over a course of 15 years. The elected head of state recalled the followings as the major achievements and his legacy in his tenure:
- Double digits economic growth
- Single digits inflation rate
- Creation of 700,000 job positions in 2015/16
Dr. Rohani cited that also every single penny of required import foreign currency, was funded from non-oil exports, made the trade balance positive after-all and it shall be considered as the high point his administration.
Finally Paid off!
The debt market finally paid off. CBI’s economic deputy announced that the capital market and foreign financing have doubled their shares of the nation’s fund raisings since the last year. “Developments of the debt market have driven down the banking network share by 10%” said Peyman Ghorbani during his keynote speech at Kish Invex 2016. Pointing out the Pro-cyclical effects of recent years’ fiscal policies, Ghorbani pictured the second relic of debt market deepening as the rebate of “business cycles” over the boom and bust periods. Counter-cyclical role, Liquidity Pro-cyclical role along with creating price and credit information are the bold of duties debt market can fulfill.
- The Securities and Exchange Organization of Iran (SEO) has obliged all listed companies, whether on TSE or IFB, to monthly release information on their performance (production and sales data) to the public within 3 business days (at most) after the end of each month through Codal system. Any delay or refusal to publish this information will count as violation. Referring to the similar statistics issued under the titles of “production and sales stats” by manufacturing companies and “portfolio report” by investment companies in the past, the authorities have said that all sectors should now release the pertinent information with respect to their industry.
- In his recent statements, the governor of the Central Bank of Iran (CBI) said that Iran experienced 5.4% economic growth over the Q1 of the current year after 8 seasons of recession and in case this trend continues, the foreign exchange rate is expected to decline. Calling the impacts of monetary and financial policies tangible, Mr. Seif mentioned the stability in economic atmosphere a prerequisite for promoting investment, especially with a long term perspective. Furthermore, he referred to controlling the shock caused by oil price fall as a huge accomplishment for the government and expressed hopes over more facilitation of economic relations between Iranian and foreign banks.
- New Treasuries on Iran Fara Bourse!
After a year the first trades on IFB, Islamic T-bills raised more than IRR 50,000 bn of funds and made the government able to settle part of its debts especially to the contractors. Now the administration is to issue new short term treasuries and develop the market even further.
IFB ranked by transparency!
All listed tickers on IFB ranked with regards to disclosure quality and proper notification over a 12 months period ended September 2nd, 2016.
Disclosure quality measured based on two factors, reliability and timeliness. Moreover, since investments companies are not ought to release EPS estimates, therefore, points on them counted regardless of the estimates.
Halted tickers announced!
TSE and IFB issuers supervisory, published a list of halted for more than 7 days tickers clearing the reasons behind. There are 21 with the absence of more than a week.
In the banking sector, despite the numerous follow ups, below names are still reluctant to publish their latest accounts (FY 2015/16). It is noteworthy to mention that CBI objects their financials mostly due the fact that they were not in accordance to IFRS.
“Homa” chained hotels to go public!
IRR 1,960 bn worth in capital, “Homa” hotels Group is to offer 10% of the shares on TSE and to be named the first of industry going public. The group is in position of 5 hotels on Tehran, Shiraz, Bandar Abbas and Mashhad with a total sum of 788 rooms. Social Security Organization is the major shareholder and they are only willing to sell 10% on the market.
Maxed out YTM!
According to the trade summaries by IFB, currently there are 18 active debt securities on the market and amid those “NIMIDCO” Musharaka is on the top of return list with a nominal rate of 23%. “Rayan Saipa” placed the second with 22% and quarterly coupon payments. The others will return between 18 to 21% and have monthly coupons.
However, the YTM on this issues has a different story. Istisna Sukuks of NIMIDCO, “SMLQ1”, if held up until the maturity, will yield 25.09 while Mashhad Municipal Musharaka has only 19.22% YTM and placed the last on the list. Sina Daroo will return 21.53% and Kaveh Kish Steel has an YTM of 20.31%.
Fifteen out of eighteen have the yield to maturity of less than 20% based on the current price levels.
The 3rd land & construction investment fund licensed!
“Naroon” land & construction investment fund got listed on TSE, as the third of its kind on Iran’s capital market, to raise IRR 182 bn funds for Arak province “Naroon residential project”. Housing investment Co. is the landlord and Maskan Investment Bank will act the fund manager.
Arak province “Naroon residential project” has 144 units and covers 20,000 m2 of area under construction.
In the Market
The stock market ended a bumpy session on a lower note with two major averages descended 0.25%. The TEDPIX (-0.25%) rallied into the early morning, but selling during the final minutes of the session drove the index down to stand on 77,287.60. Weighted TEDPIX also lost slim (-0.04%) for today, ended on 15,050.00.
“Saipa” dominated headlines for the third day in a row. More than 250 mn shares of Auto giant changed hands and the ticker closed at IRR 1,358 with almost 74 mn purchase orders in the queue. Iran Khodro on the other hand lost near 1.5% on the closing (IRR 3,168) with a volume of 18 mn. “Zamyad” and “Bahman” followed the trend as well.
Elsewhere, the top-weighted oil products sector finished in the lower end of the pack, masking relative weakness among the giants. Bandar Abbas and Isfahan Oil refineries were the leaders of downward trend and stamped 31.62 and 23.16 negative points on TEDPIX respectively. Tehran and Lavan oil refineries also lost big on today’s affair, whereas Tabriz and Shiraz refineries compensated for the whole sector. Near 1.6 mn shares of “PNTB1” traded today and the ticker closed at IRR 4,789 (+2.03%).
On the metals sector, despite the fact that global prices mostly rose, 7.2 mn shares of Isfahan Mubaraka steel traded on -2.26% today and the ticker closed at IRR 1,212 and stamped -50.67 pints on the main index. Almost all other steel makers followed the trend.
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.
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By Mahdi Goodarzi & Alireza Hojjatnia
Debt Market to play role in banks restructuring!
Iran central bank has recently gave birth to a plan reforming the banking sector structure. There is no doubt that it will be the most effective of Rohani’s administration rulings. A reform that if adequately being executed, it would lead to a paved path through economic growth and make the bed for an international re-entry.