FINANCE

 

June 02 - 08 , 2003

 

1.INTERNATIONAL

2. INDUSTRY

3. FINANCE

4. POLICY

5. TRADE

6. GULF

 

NEW CAR BOOKINGS DECLINE BY 50PC

Expectation of a possible cut in prices of automobiles from next month has drastically brought down booking orders.

Authorized dealers of Toyota, Honda and Suzuki said that booking of new cars has dropped by at least 40-50 per cent as buyers have adopted wait-and-see attitude in booking of new cars.

 

 

 

Booking of automobile proved a bonanza for the investor for last about one year after leasing companies and banks started offering liberal financial assistance and car business offered a lucrative return. But automobile dealers said the slowdown in booking was quite strange on the part of consumers as the assemblers had always refunded the difference whenever the prices were cut.

A leading Japanese car assembler said that the booking of new cars had also plunged.

The statements of Federal Minister for Industries and Production Liaquat Ali Khan Jatoi for the last four months over possible price cut followed by a firm statement on April 30 that assemblers had agreed to cut prices on June 1 has caused a major shake up in the market, thus resulting in cut of higher premiums on new models.

Suzuki Cultus CNG, on which Rs50,000 was being charged as premium as against its actual price of Rs590,000, has reduced by Rs20,000. Currently it is being sold out at Rs610,000.

CNG Mehran is being sold at Rs354,000 as against its control price of Rs324,000. Currently, its rate in black-market has fallen to Rs331,000. Alto 1000cc was selling at premium price of Rs530,000 as against its company price of Rs496,000. Now it is being sold at Rs510,000.

The premium on Toyota Corolla was being charged at Rs100,000-150,000 when it took the market by storm last year. After various statements by the federal industries minister over price cut in the last four months, the rate of premium dropped to Rs70,000-90,000. Currently, the premium on Corolla ranges between Rs50,000-60,000. Same is the case of Honda VTI models.

REMITTANCES CROSS $3.5BN MARK

Home remittances showed an impressive increase of 89.61 per cent to $3.536 billion during July-April period of 2002-03 against $1.865 billion during the same period last year.

The amount includes cash flows, encashment of FEBCs and FCBCs, Hajj remittances and remittances from Iraq-Kuwait war affectees.

Out of the total remittances received in the country during July-April 2002-03, workers' remittances contributed $3.407 billion as against $1.778 billion during the corresponding period last year, showing an increase of 91.58 per cent.

The total amounted remitted in April, 2003 was $306.85 million as compared to $238.79 million the same month last year, posting an increase of 28.50 per cent.

 

 

RISING CURRENCY

The euro skyrocketed to Rs68.53 in the inter-bank market here after it matched its all-time high of $1.1899 in the international market.

Global currency dealers quoted by news wire services said the current rise of the euro was sentiment-driven and the single European currency might see the $1.2 level before profit taking starts.

The euro has appreciated by about 27 per cent against the US dollar since its physical trading started in January 2002. From Rs54 at that time to Rs68.53 the upward journey of the euro has seen many exporters in Pakistani exploring more markets in the eurozone and pricing their export bills in euro rather than in dollar.

TWO BANKS T-BILLS AUCTION

The State Bank last week had to raise the cut-off yield on six-month treasury bills by 16 basis points as National Bank and Muslim Commercial Bank priced their bids well above the last cut-off.

Senior bankers said the central bank had to accept their bids to honour the target set for selling the bills. Sources in the two banks said there was nothing unusual in pricing the bids at a higher level because banks price their bid according to their own perception about the market forces and keeping in view the need to invest in T-bills.

CRESCENT INVESTMENT BANK

The first quarter (Jan-March 2003) report and accounts of Crescent Investment Bank Limited (CresBank) confirmed that the event to celebrate was the merger with Mashreq Bank.

For first quarter 2003, the bank posted 84 per cent drop in pretax profit to Rs58.6 million, from Rs368.8 million in the corresponding period of the previous year.

HOTEL SELL-OFF

Privatization and Investment Minister Dr Abdul Hafeez Shaikh has directed the Privatization Commission officials to complete all related formalities for holding the bidding for the sale of assets of Karachi Hotel Project formally allotted to Hyatt Regency Hotel, Karachi.

The minister, who is also the chairman of Privatization Commission and custodian of Hyatt Regency Hotel Project, will chair a pre-Privatization Commission Board meeting to review the present status and progress of various upcoming transactions.

DEUTSCHE BANK

Deutsche Bank Pakistan is considering to design financial products for the capital market which now offer attractive prospects to the investors.

A 30 minutes chat with Kenneth J. Borda, Chief Executive Officer (CEO) Asia Pacific excluding Japan of Deutsche Bank, and Chief Country Officer (CCO) Arif M. Ali revealed recent surge in the stock exchange has evoked considerable interest among the investors in the region.