Bank AL Habib (KASE:BAHL) - Share price, News & Analysis

Q: What is the Fair Price of BAHL when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

BAHL (PKR59.83) is trading below our estimate of [[fair value]] (PKR102.45)

BAHL fundamental analysis
Snowflake Score
Valuation	5/6
Future Growth	5/6
Past Performance	1/6
Financial Health	5/6
Dividends	5/6

BAHL Stock Overview

Bank AL Habib Limited, together with its subsidiaries, provides various banking products and services in Pakistan, the Middle East, the Asia Pacific, and Africa.

Rewards

Trading at 41.6% below our estimate of its fair value

Earnings are forecast to grow 22.83% per year

Earnings have grown 22.1% per year over the past 5 years

Risk Analysis

High level of non-cash earnings

Unstable dividend track record

Bank AL Habib Competitors

National Bank of Pakistan

KASE:NBP

PK₨59.5b

Allied Bank

KASE:ABL

PK₨79.0b

Bank Alfalah

KASE:BAFL

PK₨56.9b

Habib Metropolitan Bank

KASE:HMB

PK₨40.9b

Price History & Performance

Summary of all time highs, changes and price drops for Bank AL Habib
Historical stock prices
Current Share Price	PK₨58.06
52 Week High	PK₨78.49
52 Week Low	PK₨56.80
Beta	0.78
1 Month Change	-10.68%
3 Month Change	-14.58%
1 Year Change	-17.63%
3 Year Change	-26.42%
5 Year Change	4.90%
Change since IPO	3,325.79%

Shareholder Returns

	BAHL	PK Banks	PK Market
7D	-1.9%	-4.6%	-1.9%
1Y	-17.6%	-14.2%	-18.5%

Return vs Industry: BAHL matched the PK Banks industry which returned -14.2% over the past year.

Return vs Market: BAHL exceeded the PK Market which returned -18.5% over the past year.

Price Volatility

Is BAHL's price volatile compared to industry and market?
BAHL volatility
BAHL Average Weekly Movement	4.3%
Banks Industry Average Movement	4.2%
Market Average Movement	5.6%
10% most volatile stocks in PK Market	8.9%
10% least volatile stocks in PK Market	3.6%

Stable Share Price: BAHL is not significantly more volatile than the rest of PK stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: BAHL's weekly volatility (4%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1991	14,830	Mansoor Khan	https://www.bankalhabib.com

Bank AL Habib Limited, together with its subsidiaries, provides various banking products and services in Pakistan, the Middle East, the Asia Pacific, and Africa. It operates through Retail Banking, Commercial Banking, and Retail Brokerage segments. The company offers personal banking products, including current, savings, and foreign currency accounts; term deposit; car, housing, renewable energy, and cash finance; credit and debit cards; and home remittance services.

Bank AL Habib Fundamentals Summary

How do Bank AL Habib's earnings and revenue compare to its market cap?
BAHL fundamental statistics
Market Cap	PK₨64.53b
Earnings (TTM)	PK₨18.58b
Revenue (TTM)	PK₨69.78b

3.5x

P/E Ratio

0.7x

P/B Ratio

Is BAHL overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
BAHL income statement (TTM)
Revenue	PK₨69.78b
Cost of Revenue	PK₨3.27b
Gross Profit	PK₨66.51b
Other Expenses	PK₨47.93b
Earnings	PK₨18.58b

Last Reported Earnings

Dec 31, 2021

Next Earnings Date

n/a

Earnings per share (EPS)	16.72
Gross Margin	95.31%
Net Profit Margin	26.63%
Debt/Equity Ratio	354.3%

How did BAHL perform over the long term?

See historical performance and comparison

Dividends

12.1%

Current Dividend Yield

42%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is BAHL undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for BAHL?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for BAHL. This is calculated by dividing BAHL's market cap by their current preferred multiple.
What is BAHL's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	PK₨64.53b

BAHL key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	n/a
Enterprise Value/EBITDA	n/a
PEG Ratio	0.2x

Price to Earnings Ratio vs Peers

How does BAHL's PE Ratio compare to its peers?

BAHL PE Ratio vs Peers

The above table shows the PE ratio for BAHL vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	3.2x
NBP National Bank of Pakistan	2x	n/a	PK₨59.5b
ABL Allied Bank	4.3x	n/a	PK₨79.0b
BAFL Bank Alfalah	3.5x	n/a	PK₨56.9b
HMB Habib Metropolitan Bank	3x	n/a	PK₨40.9b
BAHL Bank AL Habib	3.5x	22.8%	PK₨64.5b

Forward PE

Price-To-Earnings vs Peers: BAHL is expensive based on its Price-To-Earnings Ratio (3.6x) compared to the peer average (3.2x).

Price to Earnings Ratio vs Industry

How does BAHL's PE Ratio compare vs other companies in the Asian Banks Industry?

Price-To-Earnings vs Industry: BAHL is good value based on its Price-To-Earnings Ratio (3.6x) compared to the PK Banks industry average (4.2x)

Price to Earnings Ratio vs Fair Ratio

What is BAHL's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

BAHL PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	3.5x
Fair PE Ratio	5.9x

Price-To-Earnings vs Fair Ratio: BAHL is good value based on its Price-To-Earnings Ratio (3.6x) compared to the estimated Fair Price-To-Earnings Ratio (5.9x).

Share Price vs Fair Value

What is the Fair Price of BAHL when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: BAHL (PKR59.83) is trading below our estimate of fair value (PKR102.45)

Significantly Below Fair Value: BAHL is trading below fair value by more than 20%.

Price to Earnings Growth Ratio

PEG Ratio: BAHL is good value based on its PEG Ratio (0.2x)

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Future Growth

How is Bank AL Habib forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

Future Growth Score

5/6

Future Growth Score 5/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

22.8%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: BAHL's forecast earnings growth (22.8% per year) is above the savings rate (10.5%).

Earnings vs Market: BAHL's earnings (22.8% per year) are forecast to grow faster than the PK market (5.2% per year).

High Growth Earnings: BAHL's earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: BAHL's revenue (7.9% per year) is forecast to grow faster than the PK market (4.2% per year).

High Growth Revenue: BAHL's revenue (7.9% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: BAHL's Return on Equity is forecast to be high in 3 years time (21.5%)

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Past Performance

How has Bank AL Habib performed over the past 5 years?

Past Performance Score

1/6

Past Performance Score 1/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

22.1%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: BAHL has a high level of non-cash earnings.

Growing Profit Margin: BAHL's current net profit margins (26.6%) are lower than last year (28.2%).

Past Earnings Growth Analysis

Earnings Trend: BAHL's earnings have grown significantly by 22.1% per year over the past 5 years.

Accelerating Growth: BAHL's earnings growth over the past year (3.5%) is below its 5-year average (22.1% per year).

Earnings vs Industry: BAHL earnings growth over the past year (3.5%) underperformed the Banks industry 11.6%.

Return on Equity

High ROE: Whilst BAHL's Return on Equity (20.57%) is high, this metric is skewed due to their high level of debt.

Discover strong past performing companies

Financial Health

How is Bank AL Habib's financial position? (This company is analysed differently as a bank or financial institution)

Financial Health Score

5/6

Financial Health Score 5/6

Asset Level
Allowance for Bad Loans
Low Risk Liabilities
Loan Level
Low Risk Deposits
Level of Bad Loans

Financial Position Analysis

Debt to Equity History and Analysis

Balance Sheet

Financial Institutions Analysis

Asset Level: BAHL's Assets to Equity ratio (20.5x) is very high.

Allowance for Bad Loans: BAHL has a sufficient allowance for bad loans (169%).

Low Risk Liabilities: 74% of BAHL's liabilities are made up of primarily low risk sources of funding.

Loan Level: BAHL has an appropriate level of Loans to Assets ratio (40%).

Low Risk Deposits: BAHL's Loans to Deposits ratio (56%) is appropriate.

Level of Bad Loans: BAHL has an appropriate level of bad loans (1%).

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Dividend

What is Bank AL Habib current dividend yield, its reliability and sustainability?

Dividend Score

5/6

Dividend Score 5/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

12.06%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: BAHL's dividend (11.7%) is higher than the bottom 25% of dividend payers in the PK market (3.75%).

High Dividend: BAHL's dividend (11.7%) is in the top 25% of dividend payers in the PK market (11.1%)

Stability and Growth of Payments

Stable Dividend: BAHL's dividend payments have been volatile in the past 10 years.

Growing Dividend: BAHL's dividend payments have increased over the past 10 years.

Current Payout to Shareholders

Earnings Coverage: With its reasonably low payout ratio (41.9%), BAHL's dividend payments are well covered by earnings.

Future Payout to Shareholders

Future Dividend Coverage: BAHL's dividends in 3 years are forecast to be well covered by earnings (43.4% payout ratio).

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Management

How experienced are the management team and are they aligned to shareholders interests?

3.4yrs

Average management tenure

CEO

Mansoor Khan

5.58yrs

Tenure

Mr. Mansoor Ali Khan has been the Chief Executive Officer of Bank AL Habib Limited since November 1, 2016 and serves as its Director.

Leadership Team

Experienced Management: BAHL's management team is considered experienced (3.4 years average tenure).

Board Members

Experienced Board: BAHL's board of directors are considered experienced (6.7 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/07/01 00:00
End of Day Share Price	2022/06/30 00:00
Earnings	2021/12/31
Annual Earnings	2021/12/31