STOCK WATCH

 

 

By SHABBIR H. KAZMI
Updated June 14, 2003

 

The KSE-100 index continued its upward movement. Post budget rally indicates confidence of investors in equities market. The market sentiments also reflect confidence in continuity of the GoP policies. There are expectations that the index may cross 3,300 level in next couple of weeks. The GoP also came up to the expectations of market by announcing its divestment plan of more shares of NBP, SSGC, SNGPL and PIA and listing of OGDC and sale of its 2.5% shares.

 

 

 

However, equities analysts strongly believe that the percentages indicated in the policy announcement are far smaller than the market appetite. The GoP must enhance the percentage to achieve the twin objectives increasing the free float and passing the benefit of privatization to local investors.

The upward movement of the KSE-100 index is considered an indicator of investors' confidence in equities market. However, a perturbing observation is that some market manipulators have become active. This belief is supported by the exceptional increase in prices of third and fourth tier scrips. It has been observed that the prices of these scrips skyrocket in a few trading sessions and then take a nosedive. Market manipulators change their picks every week. Though, curbing such an activity is not an easy task, it can be contained through strict monitoring and implementation of rules governing Badla trade.

ICI PAKISTAN

The company has posted Rs 172.3 million profit after tax for the quarter ending March 31, 2003 as compared to a profit of Rs 25.4 million for the corresponding period of last year. This improvement can only be attributed to the increase in sales, going up from Rs 2,583 million to Rs 4,984 million. This yielded gross profit of Rs 714 million as compared to a profit of Rs 382 million for the corresponding period of last year. However, operating expenses also went up from Rs 258 million to Rs 426 million. Other income came down from Rs 71.5 million to Rs 16.5 million. The erosion in profit was contained due to reduction in financial and other charges, going down from Rs 166.7 million to Rs 120 million.

PAKISTAN REFINERY

Increase in sales, higher income from non-refinery operations and reduction in financial charges helped the refinery in improving its profit after tax for the nine months period ending March 31, 2003 to Rs 920 million. For the corresponding period of last year the refinery had posted Rs 71.5 million profit. Sales went up from Rs 17,116 million to Rs 22,393 million. Gross profit improved from Rs 251 million to Rs 1,520 million. Operating expenses went up from Rs 61 million to Rs 82 million. Yet another big boost in profit was provided by Rs 68 million income from non-refinery operations. Financial charges declined from Rs 95 million to Rs 48 million. The Board of Directors had recommended distribution of interim dividend of Rs 2.50 per share at the time of announcement of half-yearly results. The refinery had paid Rs 2.50 per share interim dividend last year.

 

 

NATIONAL REFINERY

The refinery has posted Rs 846 million profit after tax for the nine months period ending March 31, 2003 as compared to a profit of Rs 736 million profit for the corresponding period of last year. The refinery also managed to improve its interim dividend payout from 10% to 25%. The improvement in profit can be attributed higher sales, no burden of voluntary separation scheme and reduction in financial charges. Sales went up from Rs 21,163 million to Rs 27,446 million. There was no charge against voluntary retirement scheme, the company had appropriated Rs 111 million under this head last year. Financial charges came down from Rs 69 million to Rs 28 million. However, the benefit was partly eroded due to increase in operating expenses and decrease in other income.

KOHINOOR ENERGY

Higher fuel cost, being a pass on cost, gives an impression that sales of company increased. However, analysis of financial results for the nine months period shows that gross profit registered a declined from Rs 847 million to Rs 799 million. While sales went up from Rs 1,378 million to Rs 1,875 million, cost of sales doubled from Rs 530 million to Rs 1,076 million. Operating expenses went up from Rs 44 million to Rs 60 million. Other income came down from Rs 52 million to Rs 34 million. However, the company was also to contain decline in profit due to reduction in financial charges registering a decline from Rs 260 million to Rs 197 million.

BOC PAKISTAN

The company has posted Rs 147 million profit after tax for the half year ending March 31, 2003 around the same level of profit for the corresponding period of last year. However, interim dividend paid was as little as Rs 3 per share as compared to an interim payout of Rs 14.50 per share for the corresponding period of last year. It was not any financial gimmick because last year company transferred Rs 216 million from general reserve to facilitate distribution of such a high interim dividend.

MOVEMENT AT A GLANCE

SCRIP

HIGH
(Rs.)

LOW
(Rs.)

CLOSING 
PRICE

TURNOVER
 (SHARE)

P.T.C.L.A

27.35

26.70

27.30

330,581,500

Sui North Gas

35.05

32.00

35.05

191,470,500

Hub Power

35.90

35.40

35.90

175,538,500

P.S.O.

221.50

216.00

221.50

77,196,300

National Bank

28.20

27.15

27.70

62,529,500

Engro Chem

84.40

82.50

83.90

30,328,500

Sui South Gas

21.60

20.45

21.60

19,264,000

Fauji Fert

88.50

87.05

88.50

9,914,500

M.C.B.

39.00

37.25

39.00

5,634,000

Shell Pak

406.00

402.30

405.05

1,975,600