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 1. FINEX WEEK
 2. STOCK WATCH
 3. STOCK MARKET AT A GLANCE

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STOCK WATCH

By SHABBIR H. KAZMI
Updated June 22, 2002

There seems to be some reduction in tension on Indian border. Thanks to the delayed realization by Indian authorities that the prevailing conflict could pave way for the posting of international troops on the LoC, a move most desired by the US administration. Release of third quarter report by the central bank and the federal budget for year 2002-2003 provide some boost in investors' confidence. However, there was a reduction in average daily trading volume.

Though, some critics continue to say that this government has little consideration for common man and the budget is also for the rich, the reduction on debt servicing alone is expected to encourage the GoP to spend more on infrastructure projects, higher spending on developmental projects will certainly help in boosting revival and, in turn, reducing poverty.

MEEZAN BANK

Al Faysal Investment Bank acquired the licenece for commercial banking and also changed the name to Meezan Bank. It also acquired the business interest of SG in Pakistan. At the first glance one may wonder what could be the possible reasons for the reduction of profit before tax for Jan-March 2002 to nearly half as compared to corresponding period of last year. The probe indicates a loss on currency swap arrangement of Rs 3.7 million as against a net gain of Rs 88.5 million for the corresponding period of last year. While there was a decline in net income from financing other income got a boost, from Rs 48.8 million to Rs 69.9 million. The hike in other income was due to a substantial increase in dividend income, capital gains on sale of marketable securities, whereas fee and commission decreased. It is to be seen how the bank benefits from commercial banking operations as well as buy out of SG's operations in Pakistan. SG has also acquired equity stake in Meezan Bank which aims to undertake only Riba free banking transactions.

WYETH PAKISTAN

For the year ending December 31, 2001, the company has posted Rs 285 million profit before tax as compared to a loss of Rs 7.5 million for the previous year. This seems a major recovery keeping in view lower level of sales. The recovery was driven through optimization of cost of sales, reduction in administrative expenses and financial charges. Sales came down from Rs 2,100 million to Rs 1,876 million. Cost of goods sold came down from Rs 1,477 million to Rs 1,192 million. This helped in boosting gross profit from Rs 623 million to Rs 684 million. Management succeeded in bringing down administrative expenses from Rs 443 million to Rs 322 million. Financial charges came down from Rs 125 million to Rs 56 million. The net impact was increase in EPS from a negative 14.126 for the previous year to a positive Rs 60.183 for the year under review.

JUBILEE SPINNING & WEAVING MILLS

The full year results for the year ending September 30, 2001 indicate complete reversal of fortune. The profit after tax posted for last year was as low as Rs 0.445 million, the company posted Rs 82.5 loss after tax for the year under review. Though, the company managed to post higher sales as compared to previous year, the first dent was caused by higher cost of goods sold. Gross profit came down from Rs 58.6 million to Rs 23.8 million. The second dent was caused due to reduction in other income declining from Rs 20.7 million to Rs 5.5 million. Yet another blow was due to higher provision for diminution value of investment, going up from Rs 10.5 million to Rs 32.7 million. However, the company managed to curtail financial charges from Rs 65 million to Rs 51 million. While EPS was positive Rs 0.06 for the previous it became negative Rs 11.75 at the close of year 2001.

NAGINA COTTON MILLS

The half yearly accounts for the period ending March 31, 2002 indicate reduction in profit before tax, mainly due to increase in cost of goods sold. Sales went up from Rs 573 million to slightly more than Rs 623 million as against this, cost of goods sold went up from Rs 450.9 million to Rs 540.3 million, reducing gross profit from Rs 122 million to Rs 83 million. Even the increase in other income, from Rs 9.3 million to Rs 31.3 million could not stop decline of overall profit. The result is EPS decline from Rs 2.23 to Rs 1.45 despite increase in local sales. However, the reduction in export sales indicates that the company became a victim of post September 11, era.

ELLCOT SPINNING MILLS

The half yearly accounts indicate a substantial fall in sales mainly due to reduction in exports. The company managed to compensate this reduction by posting higher sales in local market. Sales came down from Rs 387 million to about Rs 300 million. Gross profit reduced from 57.4 million to Rs 42.6 million. The management's efforts to control operating expenses and financial charges helped in resisting further fall in profitability. However, EPS came down from Rs 1.99 for the year 2001 to Rs 1.08 for the period under review.

MOVEMENT AT A GLANCE

SCRIP

HIGH
(Rs.)

LOW
(Rs.)

CLOSING 
PRICE

TURNOVER
 (SHARE)

Hub Power

23.55

22.85

23.25

140,779,500

P.T.C.L.A

17.60

17.30

17.50

89,040,500

National Bank

19.90

19.35

19.65

17,808,500

Engro Chem.

62.55

61.40

61.40

9,873,000

M.C.B.

28.00

26.20

28.00

8,655,500

Sui North Gas

14.00

13.60

13.90

5,327,000

FFC JORDAN

6.60

6.50

6.60

2,699,500

Fauji Fert

45.40

45.00

45.40

1,557,300

Sui South Gas

12.10

11.80

12.00

231,000

Askari Bank

19.45

19.00

19.30

105,000