Weekly Market Report

Trading Week : 1 - 5 July 2017

Summary

Main Topics

- Tehran Stock Exchange holds steady at 78,700

- Iran Fara Bourse falls 1.2% as investors shift to debt securities

- Iran reaches USD 5 billion energy deal with Total and China National Petroleum Corp.

 

Tehran Stock Exchange

The Tehran Stock Exchange ended another week of gains in some sectors cancelled out by falls in others, with the TSE All-Share Index closing down 0.01% at 78,700. Paper Products (+6.6%) led risers among sectors, lifted by further advances by Iran Carton Co. (KRTI +15.7%). Sugar (+4.0%) and IT (+3.3%) followed, posting a second week of gains. The biggest faller of the week was Transportation & Logistics (-3.2%), mainly due to fur­ther falls in Islamic Republic of Iran Shipping Lines (KSHJ -2.7%).

 

The TSE30 index of the thirty largest companies by market capitalization slipped 0.1% to 3,046. MAPNA Group (MAPN +3.17%), Golgohar Mining & Industrial Co. (GOLG +2.3%) and Mobile Telecommunication Company of Iran (HRMZ +2.18%) saw the highest growth over the week among the top 30s. But their gains were outweighed by various stocks end­ing in negative territory, led by Islamic Republic of Iran Shipping Lines (KSHJ -2.7%). MAPNA Group, the biggest contractor in Iran, published its unaudited financial report for the year ending March 19, 2017, showing net profits 8% higher than the latest projection at IRR 5.6 trillion (approx. USD 149 million).

 

The Average Daily Trade Volume (ADTV) rose 23% to USD 42 million this week. Most traded stocks by value were led by Sakht Ajand (SAJN +7.5%), Bahonar Copper Indus­tries Co. (BAHN +19.2%) and Insurance Industry Investment Co. (BIME -2.0%) with USD 8.5 million, USD 6.0 million and USD 4.6 million in trades respectively.

 

Iran Fara Bourse

The overall index of the Iran Fara Bourse closed 1.2% down at 899, while the market’s ADTV advanced 23% to USD 37 million. Investors shifted to debt securities with their total traded value gaining 543% to USD 108 million.

 

Foreign Exchange Market

The Central Bank of Iran raised the official dollar rate by 0.2% to IRR 32,560 while on the free market it traded up 0.9% to IRR 37,907. The euro’s official rate fell 0.4% to IRR 36,923 but its free market surged 3.2% to IRR 43,600. The official rate of the British pound added 0.1% to IRR 42,138 but on the free market sterling lost 0.2% to IRR 48,800.

 

Economic Developments

On July 3 Iran signed its first major foreign investment contract in its energy sector since international sanctions were lifted in 2016. France’s Total and China National Petroleum Corp. signed a 20-year agreement with Iran’s Petropars to invest USD 5 billion to develop phase 11 of the South Pars gas field. Total will hold a 50.1% stake, CNPC will take 30% while Iran will have the remaining 19.9%. The operation is expected to deliver 56.6 million cubic meters of natural gas a day, with production due to start in 2021.

 

Iranian state media reported a 1.2 billion euro deal with Italy to build a high-speed railway in Iran. According to the reports, Ferrovie dello Stato, the Italian state railway company, will build a 135 km line in central Iran linking Arak and Qom as well as a 325-km high-speed line between Tehran and Hamedan in the west. The parties are expected to sign the deal on July 11. Iran aims to increase its rail network by almost 70% to 25,000 km in eight years.

 

The Iran Vehicle Manufacturers Association reported that car production grew at an annu­al rate of 15.2% in the first quarter of the current Iranian calendar year. Passenger cars made up 41% of the total production of 306,545 vehicles, registering a 29% increase over the same year-ago period. Car output grew 37% last year to 1.3 million, making this one of the top performing sectors since the removal of nuclear-related sanctions. Production is projected to reach an annual 1.9 million units in the next three years.

 

In contrast to developments in the energy, transport and car sectors, the Cement Industry Employers Association reported that cement production fell 6% to 55.2 million tonnes in the year to March 19, 2017. Output was 17% below projections, with the industry running at 68% of capacity.

FX Information

Description

6 July 2017

29 June 2017

% Change

Official USD - IRR

32,560

32,489

0.2

Market USD - IRR

37,907

37,586

0.9

Official EUR - IRR

36,923

37,057

(0.4)

Market EUR - IRR

43,600

42,261

3.2

Official GBP - IRR

42,138

42,081

0.1

Market GBP - IRR

48,800

48,900

(0.2)

Market Information

Index Info

Close

Unit Change

% Change

%  Change from March 20, 2017

TSE Overall Index—TEDPIX

78,700

(4.3)

(0.01)

2.6

TSE30 Index

3,046

(1.6)

(0.1)

(1.0)

Iran Fara Bourse Overall Index

899

(10.7)

(1.2)

2.8

Description

This Period

Last Period

Market P/E

6.9

7.0

Trade Statistics

Description

This Period

Last Period

% Change

TSE Average Daily Trade Vol­ume (Million USD) **

42

34

23

IFB Average Daily Traded Val­ue (Million USD) **

37

30

23

Industry Index Information

Description

Close

% Change

Paper Products

14,173

6.6

Printing & Publishing

182,753

4.7

Sugar

8,434

4.0

IT

12,754

3.3

Engineering Services

693

3.2

Other Financial Services

2,474

3.1

Rubber & Plastics

23,187

1.6

Metallic Ore

12,671

1.4

Telecommunication

940

1.1

Construction

768

0.7

Base Metals

33,304

0.6

Non-Metallic Ores

2,340

0.5

Oil Products

209,460

0.3

Machinery & Equipment

16,441

0.3

Machinery & Electric Equipment

558,003

0.3

Foods excluding Sugar

3,784

0.2

Leather Production & Products

1,740

0.1

Medical & Measurement Products

10,244

0.0

TSE All-Share Index

78,700

(0.01)

Ceramics & Tiles

2,099

(0.1)

Pharmaceuticals

9,500

(0.1)

Utility Service Providers

195

(0.2)

Metallic Products

30,489

(0.4)

Cement

699

(0.4)

Textile

1,411

(0.7)

Wooden Products

60,312

(0.7)

Banking

565

(0.8)

Insurance

5,053

(0.9)

Chemicals

4,742

(0.9)

Industrial Conglomerates

7,378

(0.9)

Automotive

18,160

(0.9)

Investment

1,873

(1.2)

Transportation & Logistics

3,626

(3.2)

Oil Drilling & Services

603

(3.4)

Agriculture

6,968

(4.5)

Mining

16,457

(8.4)

Coal Mining

1,188

(8.6)

TSE Top 5 Gainers

Company

Close **

(USD Cents)

% Change

SHAD

Shahdiran Co.

8.2

16.5

KRTI

Iran Carton Co.

18.1

15.7

SRMA

Iran Sarma Afarin Industrial Co.

16.2

12.3

DMVN

Damavand Mining Co.

45.8

11.9

TKSM

Takceram Tile Manufacturing Co.

6.2

9.7

TSE Top 5 Value Leaders

Company

Close **
(USD Cents)

Trade Value **

(Million USD)

SAJN

Sakht Ajand Co.

10.9

8.5

BAHN

Bahonar Copper Industries Co.

11.4

6.0

BIME

Insurance Industry Inv. Co.

10.2

4.6

APPE

Asan Pardakht Persian Co.

67.1

3.8

PNES

Esfahan Oil Refining Co. 

7.7

2.2

** All figures in USD are converted from IRR at the free market rate

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