Market News

– Central bank of Iran deputy oversight announced that Iran’s banking sector components are to divest more real estate and equities to address their frozen assets problems. Over past the three years, Iranian banks divest their ownerships in IRR 350,000 bn (cUSD 7.7 bn) of frozen assets and they are to sell their stakes with same value (cUSD 7.7 bn) again before the end of July 2018. The proceeds from these divestures are to be used to meet their capitalization needs.

– On Wednesday, January 24^th, Parallel Standard Salam Sukuk securities of light crude worth IRR 5,000 bn (cUSD 109.9 mn) will be offered by the Ministry of Economic Affairs and Finance on behalf of the Iranian administration in Iran Energy Exchange derivative market with the ticker “LC011” at a fixed price on a public auction. The IPO will start at 9:30 am and after listing purchase orders by brokers, contracts will be traded since 10:00 am.  The settlement process will be 1 working day after the trade is done and the cash clearing at maturity will be carried out no more than 5 working days from the last trading date.

– In a live TV interview outlining his administration’s plans and agenda in political, social and economic areas, President Rouhani briefly discussed Iran’s economy status following the attempts done and measures taken and the progress made. He put the country’s income at $90 bn with its expenses at $75 bn and reassured that no shortage of foreign exchange exists in the country and the recent fluctuations will cool off soon. He then stressed on the government commitment to tackle problems caused by the un-authorized financial institutions and protect the public capitals and made remarks on the attempts taken and to be taken to solve environmental problems, among which he referred to the modernization of worn out transportation fleet, which might be the reason behind the positive sentiment in the Auto sector.

Corporate Earnings

– Kharg Petrochemical has recognized IRR 2931 EPS (covering 84% of its budget) over the 9-month period ended December 22^nd, which posts a 133% rise compared to the same period last year. The company’s operating income and profit have also posted 54% and 149% increase. Being on an ascending trend, its net profit has seen a 40% and 70% jump in comparison with the summer and fall, respectively, which is mostly attributable to forex price growth and higher sales.

In the Market

After two overwhelming sessions, mostly originating from excitation in the forex market which itself was volatile as the result of non-economic factors, investors in the stock market seem to take more percussions in their decisions, although positive signs of stability in the forex market have been received. In this regard, the governor of the Central Bank of Iran (CBI) also announced the ending of the rally in foreign exchanges in the very near future, stressing that the economy is in a good state and this body is in full control.

The Automotive space settled with considerable gains, which might be attributed to the President’s interview last night; Iran Khodro and Saipa, as the industry leaders, also finished in the +1% zone.

The Food & Beverages space has recently seen a rise in demands. According to official statistics, Iranian dairy products export has posted a 30% rise over the 9-month period ended December 22^nd; 750,000 tons of products have been sent to Europe, Iraq, Russia and Persian Gulf region. It was so while Iran sold 850,000 tons of such products, worth $773 mn in the past Persian calendar year. Pegah-e Golpayegan Dairy and Pak Dairies went up by 2.39% and 0.6%, respectively.

After its IPO on January 16^th, Zagros-e Shahr-e Kord Milk and Meat Company’s ticker, listed on the Agriculture industry, which had been halted the other session, due to a 20% hike in 4 consecutive sessions according to the SEO new monitoring regulations, was reopened 10% higher, which resulted in many shareholders’ selling their shares enjoying a higher than 30% return; the symbol again faced a buy queue.

Led by Bank Mellat (-2.4%), the Banking industry went through rather balanced trades, with Post Bank (+1.03%) as the top gainer. Being halted for more than a year now, Bank Saderat finally announced the date of its AGM and extraordinary GM, within 2 weeks from now, aimed at electing the board members along with approving its IFRS-compliant financial statements.

Source:

2018, USD/IRR Battel on Iran’s Economy!, Tuseday, January 23, p.1,<https://agahgroup.com>