ECC approves the removal of dividend distribution cap on MPCL

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ECC approves the removal of dividend distribution cap on MPCL

The Economic Coordination Committee (ECC) was presided over by Minister for Finance and Revenue Dr Abdul Hafeez Shaikh on Wednesday received a summary from the Petroleum Division for removal of dividend distribution cap on Mari Gas Company Limited (MPCL) under Gas Pricing Agreement as the company is being considered for privatisation.

The ECC of the Cabinet has allowed removal of dividend distribution cap on Mari Petroleum Company Limited (MPCL) to ensure that the divestment transaction generates optimum sale proceeds for the government.

After due deliberations, the ECC allowed that the dividend distribution cap may be removed to ensure that the divestment transaction generates optimum sale proceeds for the government.

The ECC meeting further decided that the MPCL would ensure dividend distribution in accordance with the Provisions of Companies Act, 2017 and the Companies (Distribution of Dividends) Regulations, 2017.

CPI clocked in at 5.7% in January 2021

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CPI clocked in at 5.7% in January 2021

Pakistan Bureau of Statistics (PBS) released the Consumer Price Index (CPI) inflation figure for the month ended January, 2021. The CPI clocked at 5.7%YoY in January 2021 as compared to an increase of 8.0% in the previous month and 14.6% in January 2020. On month-on-month basis, it decreased by 0.2% in January 2021 as compared to a decrease of 0.7%.

Hascol’s board approve to increase the Authorize capital from Rs. 10Bn to Rs. 50Bn

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Hascol’s board approve to increase the Authorize capital from Rs. 10Bn to Rs. 50Bn

Hascol Petroleum Limited in a latest notification to PSX, has announced that its board of Directors approved the increase in Authorize share capital of the company from rs. 10Bn to Rs. 50Bn subject to obtaining the requisite approvals from the shareolder of the company.

Lucky Cement decided to increase its cement production capacity at its Pezu plant

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Lucky Cement decided to increase its cement production capacity at its Pezu plant

Lucky Cement in a notification to PSX, announced that company has decided to increase its cement production capacity at its Pezu plant by Rs. 3.15Mn tonnes per annum. This has been done with the increasing demand in the domestic cement industry on the back of revival of economic activity and an uptick in the construction project including both retail level projects as well as mega infrastructure development projects.

The total project cost of the above expansion shall be finalized after negotiation with suppliers/contractors. The construction work on the project is expected to commence within the current financial year.

EPCL shares Quarterly progress report on implementation of PVC expansion/VCM debottlenecking

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EPCL shares Quarterly progress report on implementation of PVC expansion/VCM debottlenecking

In a latest notification to PSX, the Engro Polymer & Chemical Limited posted Quarterly progress report on implementation of PVC expansion/VCM debottlenecking.

Despite the challenges posed by the pandemic, the progress at PVC has been satisfactory. We are pleased to inform that the PVC plant has attained Mechanical Completion. We are now in the commissioning phase and on target to attain COD as of end Q1 2021. On the VCM debottlenecking front, construction work remained in progress but has experienced some hindrance due to shipment postponement and minor manpower mobilization issues on part of the EPC contractor. There is a distinct possibility that Mechanical completion will see some delay and COD will spill over to early Q2 2021.

Panther Tyres successfully raises Rs2.632bn through book building

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Panther Tyres successfully raises Rs2.632bn through book building

Panther Tyres Limited raised funds worth Rs2.63 billion through a book building process at the Pakistan Stock Exchange (PSX) on Thursday.

The company strike price clocked in at Rs65.8 each during the two-day (Jan 27-28) book building process. The company opened bidding at Rs47 per share, which could increase by a maximum of 40% to the upper limit of Rs65.8 in accordance with the prevailing laws.

The financing will be utilised for expansion of its tyre and tube manufacturing capacity.

Initial Public Offering (IPO) Consultant Arif Habib Limited CEO Shahid Ali Habib said: “This has happened for the first time in history that any company has sold shares at the upper limit during the book building process … since the introduction of 40% cap rule a few years ago,”

Fauji Foundation to acquire majority stake in Silk Bank

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Fauji Foundation to acquire majority stake in Silk Bank

In a latest notification to PSX, Fauji Foundation (FF) has expressed its intention to acquire majority stake in Silk Bank Limited (PSX:SILK).

As a part of the process, Silk Bank has been requested to allow FF to conduct due diligence of Silk Bank and in this regard FF intends to apply to SBP for the requisite approval of the same.

Corporate Result: Fauji Fertilizer Company Annual Earnings observe growth of 72%

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Corporate Result: Fauji Fertilizer Company Annual Earnings observe growth of 72%

In a latest notification to the PSX, the Fauji Fertilizer Company Ltd (PSX:FFC) announced the result for the year ended December 31, 2020. The company announced the Profit After Tax of Rs.29.7Bn, showing a growth of 72% YoY basis. The Eanring Per Share (EPS) clocked in at Rs. 23.38.

The company earning were increased as a result of Low expense and a surge in Share of Profit of Associates & Joint venture that recorded profit of Rs. 8.29Bn as compared to the loss of Rs. 379.3Mn

Net Sales of the company stood at 102.7Bn declined by 6%. The Cost of Sales was also down by 11%, that translated into higher Gross Profit of Rs. 34.4Bn (4.9% Up).

The Finance and Administrative Expense recorded a decline of 27% and 6.7% respectively. Moreover, the company also announced Final Cash Dividend of Rs. 3.40 per share (34%)

Fauji Fertilizer Company Limited (FFC) – Annual Result

EPS 2020 = 23.38 PKR
EPS 2019 = 13.62 PKR

Cash Dividend = 3.40 PKR
Bonus Share = NIL

HUBC’s subsidiary & Central Power Purchasing Agency signed an agreement in furtherance of the MoU

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HUBC’s subsidiary & Central Power Purchasing Agency signed an agreement in furtherance of the MoU

In a latest ntoification to the Pakistan Stcok Exchange, the Hub Power Company Limited (HUBC) announced that the Narowal Energy Limited (a wholly-owned subsidiary of HUBC under the 2002 Power Policy) and Central Power Purchasing Agency (Guarantee) Limited (Power Purchaser) have initialed an agreement in furtherance of the Memorandum of Understanding dated 12th August 2020.

Under the Agreement, at the request of the Government of Pakistan, in the larger national interest and sectoral sustainability, the future O&M savings and heat rate efficiency, shall be shared by the Parties.

The payment of overdue receivables is an integral part of the Agreement and the payment mechanism of the Company’s overdue receivables is in the process of being finalized with installments comprising cash and other financial instruments.

On payment of the said receivables, Late Payment Surcharge (LPS) on future invoices will be lowered to KIBOR + 2.0% for the first sixty (60) days and then shall revert to KIBOR + 4.5% as per the PPA, while ensuring that payments follow the PPA mandated FIFO payment principles for this rate to be effective.

The ROE/ROEDC rate shall be changed from the current rate of 15% in US$ to 17% in PKR, with no future US$ indexation and the US$ equity shall be converted to PKR using an exchange rate PKR/US$ of 148. However, the current indexation shall continue to be applied until the date the applicable exchange rate under the present Tariff reaches PKR/US$ of 168.

Further, on the full implementation of the Competitive Trading Arrangement, subject to mutual agreement between the Parties, the plant will move to Take & pay basis. Reconciliation and terms of assessment of past payments will also form part of this Agreement.

The terms of the Agreement are subject to the approval of the Board of Directors of Narowal Energy Limited, Hubco, NEPRA, the Federal Cabinet, and execution of a final binding agreement.

MPC: Policy rate remains stable at 7%

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MPC: Policy rate remains stable at 7%

The Monetary Policy Committee (MPC) decided to maintain the policy rate at 7 percent. The MPC noted that since the last meeting in November, the domestic recovery has gained some further traction. Most economic activity data and indicators of consumer and business sentiment have shown continued improvement.

As a result, there are upside risks to the current growth projection of slightly above 2 percent in FY21. On the inflation front, recent out-turns are also encouraging, suggesting a waning of supply-side price pressures from food and still-benign core inflation. While utility tariff increases may cause an uptick in inflation, this is likely to be transient given excess capacity in the economy and wellanchored inflation expectations. As a result, inflation is still expected to fall within the previously announced
range of 7-9 percent for FY21 and trend toward the 5-7 percent target range over the medium-term. With the inflation outlook relatively benign aside from the possibility of temporary supply-side shocks, the MPC felt that the existing accommodative stance of monetary policy remained appropriate to support the nascent recovery while keeping inflation expectations well-anchored and maintaining financial stability.

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