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Author: Mrs. Anjum Shahnawaz

  • Engro Corp announces Rs14.8 billion profit after tax in first quarter

    Engro Corp announces Rs14.8 billion profit after tax in first quarter

    KARACHI: Engro Corporation Limited has announced Rs14.8 billion profit after tax during first quarter (January – March) 2021 as compared with Rs5.9 billion in the same quarter of the last year, showing about 150 percent growth.

    According to a statement issued on Thursday, Engro’s consolidated revenue grew by 58 percent from Rs 44,977 million during Q1 2020 to Rs 70,866 million in Q1 2021.

    The Company posted a consolidated Profit After Tax (PAT) of Rs 14,779 million compared to Rs 5,940 million for the similar period last year.

    Profit attributable to the owners was recorded at Rs 8,337 million compared to Rs 3,317 million for the prior period, resulting in an Earnings per Share (EPS) of Rs 14.47 compared to Rs 5.76. This growth in the results is primarily attributable to the higher profitability reported by Engro Fertilizer and Engro Polymer & Chemicals.

    On a standalone basis, the Company posted a PAT of Rs 3,586 million against Rs 780 million for the same period last year, translating into an EPS of Rs 6.22 per share. The Company announced an interim cash dividend of Rs 12 per share for the first quarter.

    Financial Performance – Segmental Perspective:

    Fertilizers: Domestic market witnessed strong agricultural sector performance in Q1 as farm economics continued to improve, driven by better farm output prices and enhanced support pricing. The Company produced 523 KT of Urea vs. 572 KT for the comparative period due to a turnaround in one of the plants.  The Company delivered quarterly Urea sales of 582 KT vs. 169 KT and Phosphate sales of 74 KT vs. 36 KT during the same period last year. As a result, the PAT for the Company stood at Rs 5,741 million for Q1 2021 as compared to Rs 571 million in the same period last year.

    Petrochemicals: During Q1 2021, international prices of PVC rose to an unprecedented level of USD 1,670 per ton as the winter storm in the US drove multiple unplanned shutdowns and forced majority of the PVC capacity offline. Furthermore, the Company announced commercial operations of the new PVC plant on 1st March 2021, which increased the total capacity to 295,000 MT per annum.

    During Q1 2021, the Company recorded a revenue of Rs 15,671 million as compared to Rs 7,058 million in Q1 2020. With increased volumetric sales, efficient operations and higher international prices, the Company posted a PAT of Rs 4,143 million compared to a PAT of Rs 193 million for the same period last year. This is the highest quarterly profit ever achieved by Engro Polymer and Chemicals.

    Connectivity: Engro continued to invest and progress in its Connectivity vertical through Engro Enfrashare strengthening its footprint to a portfolio size of 1,577 operational sites (1,265 sites in 2020), while hosting 1,681 tenancies (1,362 tenancies in 2020) and catering to all Mobile Network Operators (MNOs) in Pakistan. This portfolio expansion has led to a significant increase in the market share as an Independent TowerCo from 41 percent in 2020 to 44 percent during Q1 2021.

    Energy & Power:

    Mining and power plant operations at Thar continued smoothly, with over a million tons of coal being supplied by the mine. The plant remained fully operational and achieved 81 percent availability with a load factor of 76 percent and a dispatch of 987 GwH to the national grid during the quarter. Meanwhile, the expansion of the mine at Thar to increase output to 7.8 million tons per annum is underway.

    The Qadirpur Power Plant operates on permeate gas and is currently facing gas curtailment from the Qadirpur gas field as it continues to deplete. To make up for this shortfall, the plant has been made available on mixed mode. The Plant dispatched a Net Electrical Output of 190 GwH to the national grid with a load factor of 41 percent compared to 37 percent during similar period last year. The business posted a PAT of Rs 399 million for the current period as compared to Rs 895 million for Q1 2020, which is mainly attributable to retirement of debt component.

    Terminals: Profitability of both the LNG and chemicals terminal remained healthy for the current quarter. The LNG terminal handled 18 cargoes, delivering 52.8 bcf re-gasified LNG in to the SSGC network. The chemicals terminal had an actual throughput of 286 kT vs. 246 kT during the similar quarter last year. The increase was primarily observed in chemical volumes, offset by lower LPG handling.

  • Equity market witnessed decline of 377 points on rising coronavirus cases

    Equity market witnessed decline of 377 points on rising coronavirus cases

    KARACHI: The equity market fell by 377 points on Thursday owing to rising concerns of investors over fast spread of coronavirus in the third wave.

    The benchmark KSE-100 index of Pakistan Stock Exchange (PSX) closed at 44,930 points as against previous day’s closing of 45,306 points, showing a decline of 377 points.

    Analysts at Arif Habib Limited said that concern over growing cases of Corona and incidence in major cities thereof kept the investors perturbed the second day as well, where despite healthy earnings posted by companies announced today, the index eventually went down by 424 points. At the close, the index registered a decline of 377 points.

    E&P, Cement, Steel scrips contributed the most to the decline, whereas banking sector stocks saw pick up today. Notable scrips declaring results today includes ENGRO and UBL, which made the announcement at the beginning of the session that included dividend declaration, however, selling pressure brought the stock prices down by the end of session. Among scrips, GGL topped the volumes with 36.3 million shares, followed by TRG (30.2 million) and WTL (26.8 million).

    Sectors contributing to the performance include E&P (-94 points), Cement (-79 points), Textile (-55 points), Technology (-45 points) and Autos (-34 points).

    Volumes declined from 387.9 million shares to 328.9 million shares (-15 percent DoD). Average traded value also declined by 18 percent to reach US$ 103.5 million as against US$ 126.3 million.

    Stocks that contributed significantly to the volumes include GGL, TRG, WTL, UNITY and TELE, which formed 38 percent of total volumes.

    Stocks that contributed positively to the index include UBL (+56 points), HBL (+45 points), ENGRO (+27 points), BAFL (+11 points) and BAHL (+8 points). Stocks that contributed negatively include OGDC (-40 points), MCB (-29 points), PPL (-26 points), SYS (-25 points) and LUCK (-20 points).

  • Foreign exchange reserves flat at $23.21 billion

    Foreign exchange reserves flat at $23.21 billion

    KARACHI: The foreign exchange reserves of the country registered nominal fall of $7 million to $23.213 billion by week ended April 16, 2021, State Bank of Pakistan (SBP) on Thursday.

    The foreign exchange reserves of the country were $23.22 billion by week ended April 09, 2021.

    The official foreign exchange reserves of the SBP fell by $62 million to $16.044 billion by week ended April 16, 2021 from $16.106 billion a week ago.

    However, foreign exchange reserves maintained by commercial banks increased by $55 million to $7.169 billion by week ended April 16, 2021 as compared with $7.114 billion a week ago.

  • Rupee falls by 23 paisas against dollar

    Rupee falls by 23 paisas against dollar

    KARACHI: The Pak Rupee fell by 23 paisas against the dollar on Thursday owing to rising demand for the foreign currency for import and corporate payments.

    The rupee ended Rs153.46 to the dollar from previous day’s closing of Rs153.23 in the interbank foreign exchange market.

    The currency dealers said that demand for imported goods increased due to rising domestic supplies. Further, the dollar demand was also increased due to corporate payment demand as foreign companies repatriate their profit and dividends after closing of a quarter.

    The dealers hoped that the local currency would recover in coming days due to improved remittances and export receipts.

  • Bank Alfalah announces Rs3.47bn net quarterly profit

    Bank Alfalah announces Rs3.47bn net quarterly profit

    KARACHI: Bank Alfalah Limited (BAFL) on Thursday announced Rs3.47 billion profit after tax for the quarter ended March 31, 2021.

    The net profit is 23 percent higher when compared with Rs2.82 billion in the same quarter of the last year.

    The bank also declared Rs1.95 as earnings per share (EPS) for the quarter ended March 31, 2021 as compared with Rs1.59 in the corresponding quarter of the last year.

    According to the financial results submitted to the Pakistan Stock Exchange (PSX) the provisions/write-offs of the banks was at Rs216 million during the first quarter of 2021 as compared with Rs1.52 billion in the corresponding quarter of the last year.

    Net Markup / Interest Income of the bank, however, fell to Rs10.32 billion for the quarter under review as compared with Rs11.78 billion in the corresponding quarter of the last year.

    Non mark-up/interest income of the bank increased to Rs3.83 billion for the quarter ended March 31, 2021 as compared with Rs2.71 billion in the corresponding quarter of the last year.

    The bank also made considerable income through gain on securities to Rs1.09 billion during the first quarter of 2021 as compared with loss of Rs46 million in the same quarter of the last year.

    Total income of the bank during the quarter fell marginally to Rs14.15 billion during first quarter of 2021 as compared with Rs14.49 billion in the corresponding period of the last year.

    Operating expenses of the bank remained flat at Rs8.45 billion as compared with Rs8.05 billion. Total expenses of BAFL rose to Rs8.57 billion during the first quarter of 2021 as compared with Rs8.2 billion in the corresponding quarter of the last year.

  • United Bank declares 46pc growth in Q1 profit

    United Bank declares 46pc growth in Q1 profit

    KARACHI: United Bank Limited (UBL) on Thursday declared 46 percent growth in its net profit for the quarter ended March 31, 2021 due to significant decline in provisioning and write-offs.

    The bank declared Rs7.4 billion profit after tax for the first quarter (January – March) of calendar year 2021 as compared with Rs5.06 billion in the corresponding period of the last year.

    The bank also declared Rs6.05 as earnings per share (EPS) for the quarter ended March 31, 2021 as compared with Rs4.13 in the corresponding quarter of the last year.

    According to the financial results submitted to the Pakistan Stock Exchange (PSX) the provisions/write-offs of the banks was at Rs354 million during the first quarter of 2021 as compared with Rs3.7 billion in the corresponding quarter of the last year.

    Net Markup / Interest Income of the bank, however, fell to Rs16.85 billion for the quarter under review as compared with Rs17.34 billion in the corresponding quarter of the last year.

    Non mark-up/interest income of the bank increased to Rs5.78 billion for the quarter ended March 31, 2021 as compared with Rs4.66 billion in the corresponding quarter of the last year.

    The bank also made considerable income through gain on securities to Rs1.86 billion during the first quarter of 2021 as compared with Rs342 million in the same quarter of the last year.

    Total income of the bank during the quarter increased nominally to Rs22.64 billion during first quarter of 2021 as compared with Rs22 billion in the corresponding period of the last year.

    Operating expenses of the bank remained flat at Rs9.85 billion as compared with Rs9.47 billion. Total expenses of UBL rose to Rs10.12 billion during the first quarter of 2020 as compared with Rs9.87 billion in the corresponding quarter of the last year.

  • SBP, SECP revise ToRs for joint task force

    SBP, SECP revise ToRs for joint task force

    KARACHI: The State Bank of Pakistan (SBP) and the Securities and Exchange Commission of Pakistan (SECP) have amended the Terms of Reference (ToRs) of their Joint Task Force (JTF) on Financial Conglomerates to further strengthen the  supervisory cooperation, inter alia, in AML/CFT/CPF supervision at financial-group level. Dr, Reza Baqir, Governor, SBP and Aamir Khan, Chairman, SECP have signed the Letter of Understanding (LoU) for amendments in the ToRs, according to a statement issued on Thursday.

    The interagency cooperation between financial sector regulators is a crucial element for the effective supervision of financial groups, which comprise various types of financial institutions.

    Accordingly, the SBP and SECP established the JTF in March 2009 to proactively identify and tackle the risks posed by conglomeration in the financial sector.

    The ToRs of the JTF envisage the supervisory cooperation, holding periodic meetings and information sharing between both the regulators in respect of the financial groups. The ToRs have been revised from time to time to align with the developments in the regulatory sphere and dynamics of the financial market.

    Keeping in view the importance of the group-level AML/CFT/CPF supervision, both SBP and SECP jointly agreed to specifically cover this area in the ToRs of the JTF in a more explicit manner.

    These improvements in the ToRs will allow the regulators to effectively implement group-level AML/CFT/CPF supervision in line with the international standards, and strengthen cooperation and information sharing in a more systematic manner. Revised TORs will further the overall policy objectives of soundness, integrity and fair conduct in the financial system.

  • FBR expands operations against Benami assets to four major cities

    FBR expands operations against Benami assets to four major cities

    The Federal Board of Revenue (FBR) has decided to expand its operations by establishing Anti-Benami Zones in four major cities across the country.

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  • Customs intelligence Karachi announces auction of confiscated vehicles on April 23

    Customs intelligence Karachi announces auction of confiscated vehicles on April 23

    KARACHI: The Directorate of Intelligence and Investigation, Customs, Karachi has announced a public auction of confiscated vehicles, scheduled to take place on April 23, 2021.

    (more…)
  • SECP’s guidelines for convertible debt securities

    SECP’s guidelines for convertible debt securities

    ISLAMABAD: Securities and Exchange Commission (SECP) on Wednesday notified guidelines for issuance of convertible debt securities in Pakistan through both private placement and public offering mode.

    The SECP issued the following guidelines:

    Steps involved in Private Placement:

    i. Requisite approval under section 83 of the Companies Act, 2017 for further issue of share capital in relation to Issuance of CDS. (Since conversion of CDS into shares would enhance the share capital of the Company, therefore approval of section 83 (1) b is required, whereby a public Limited company can enhance share capital by the way of other than right offer through special resolution and Commission’s approval.

    ii. Structuring of CDS as per the Structuring of Debt Securities Regulations, 2020. As per the said Regulations, the Issuer can issue the CDS either through execution of Issuance agreement or Trust Deed. Provisions relating to Trust Deed and Issuance agreement are specified at regulation 11 and 15 of the Structuring of Debt Securities Regulations, 2020, respectively.

    iii. Appointment of Investment agent or Debt Securities Trustee depending upon the structure opted by the Issuer. (Investment agent is required in case of Issuance agreement and Debt Securities Trustee in case of Trust structure.)

    Entity holding a valid Consultant to the Issue license can act as Investment Agent, list of licensed Consultant to the Issue and Debt Securities Trustee is available at SECP’s website and can be accessed through:

    https://www.secp.gov.pk/data-and-statistics/capital-markets/

    iv. Drafting of Information memorandum by the Issuer for private placement. (Content of Information memorandum is prescribed in the Private Placement Rules, 2017)

    v. After complying with aforesaid requirements, Issuer can directly place convertible debt securities to the eligible investors as per Private Placement Rules, 2017. Only eligible investors can invest in privately placed convertible debt securities. (Eligible investors are specified by Commission vide SRO dated April 19, 2021 under section 66 of the Companies Act, 2017).

    vi. No regulatory approval is required for placement of CDS. (Since, the issue is privately placed and general public is not involved, therefore PSX and SECP approval is not required)

    vii. After placement, Issuer can list the CDS at Pakistan Stock Exchange as per Chapter 5C of the PSX Rule Book. (Listing requirements are specified in Chapter 5C).

    viii. Subsequent to listing, only eligible investors notified by the Commission can invest in these securities in secondary debt market.

    ix. Secondary market trading of privately placed listed debt securities is visible at BNB trading board of PSX and can be accessed through:

    https://dps.psx.com.pk/trading-panel

    Steps involved in Public Offering:

    i. Appointment of Consultant to the Issue (CTI), Underwriter(s) and Shareregsitar by the Issuer as per Public Offering Regulations, 2017.

    List of licensed Consultant to the Issue, Underwriters and Share Registrars is available at SECP’s website and can be accessed through:

    https://www.secp.gov.pk/data-and-statistics/capital-markets/

    (Role of Consultant to the Issue is to (i) draft listing application, prospectus and related documents; (ii) seek approval of PSX and SECP on the behalf of the Issuer; (iii) ensure publication of prospectus in accordance with relevant law; (iv)conduct roadshows to sell the issue; (v) guide issuer throughout the public offering process etc.

    (Role of Underwriter: Underwriter provides commitment to subscribe the unsubscribed portion of the issue. Underwriting helps the Issuer to get desired amount of the funds required for the implementation of the Project, which the Issuer would not be able to get in case of undersubscription of securities. Moreover, underwriting provide confidence to the investors that an independent third party has conducted proper due- diligence of the issue including the price before underwriting the issue.)

    ii. Structuring of CDS as per the Structuring of Debt Securities Regulations, 2020. As per the said Regulations, the Issuer can issue the CDS either through execution of Issuance agreement or Trust Deed. Provisions relating to Trust Deed and Issuance agreement are specified at regulation 11 and 15 of the Structuring of Debt Securities Regulations, 2020, respectively.

    iii. Appointment of Investment agent or Debt Securities Trustee depending upon the structure opted by the Issuer. (Investment agent is required in case of Issuance agreement and Debt Securities Trustee in case of Trust structure.)

    Entity holding a valid Consultant to the Issue license can act as Investment Agent, list of licensed Consultant to the Issue and Debt Securities Trustee is available at SECP’s website and can be accessed through:

    https://www.secp.gov.pk/data-and-statistics/capital-markets/

    iv. Preparation of Prospectus and listing documents by the CTI. (Content of Prospectus is prescribed in First Schedule of the Public Offering Regulations, 2017)

    v. Submission of listing documents along with the prospectus to the PSX for approval. (Listing documents are specified at Annexure -I of Chapter 5B of the PSX rule book) PSX rule book can be accessed through:

    https://www.psx.com.pk/psx/themes/psx/uploads/PSX_Rulebook_%28updated_on_March_31%2C_2021%29.pdf

    vi. Approval under section 83 of the Companies Act, 2017 for further issue of share capital. Since Conversion of CDS into shares would enhance the share capital of the Company, therefore approval of section 83 (1) b is required, whereby a public Limited company can enhance share capital by the way of other than right offer through special resolution and Commission’s approval. (It is advisable to obtain approval(s) after structuring of the CDS, however approval can be obtained before placement)

    vii. Placement of prospectus by PSX on its website for seeking public comments. (seven working days)

    viii. Pursuant to PSX approval, submission of prospectus to the Commission for approval under section 87 (2) read with section 88(1) of the Securities Act, 2015.

    ix. Subsequent to Commission approval, seeking dates from PSX for publication of prospectus and public subscription. (To save cost, abridged version of prospectus can be published)

    x. Prospectus has to be published in at least one English Newspaper and Urdu version of the prospectus in at least one Urdu Newspaper.

    xi. Prospectus has to be published not less than seven days and not more than thirty days before the commencement of the subscription period.

    xii. Publication of prospectus after obtaining dates from PSX.

    xiii. Placement of CDS to the general public during the public subscription period.

    xiv. Listing of CDS at Pakistan Stock Exchange as per Chapter 5B of the PSX Rule book (Listing requirements are specified in Chapter 5B).

    xv. Subsequent to listing, general public including both institutional and individual investors can invest in these securities in secondary debt market.

    xvi. Secondary market trading of publicly listed debt securities is visible at BNB trading board of PSX and can be accessed through:

    https://dps.psx.com.pk/trading-panel