STOCK WATCH

 

 

By SHABBIR H. KAZMI
Updated Sept 20, 2003

 

During the week, the KSE-100 lost 215 points amidst high volatility originating from the letter sent by HUBCO to the Karachi Stock Exchange. This was regarding transfer of 58 million shares held by International Power in the company into the Central Depository System (CDS). The market punters assumed that the conversion was the first step towards ultimate sale of these shares. International Power had already sold about 5% of its holding in HUBCO. The index lost 207 on the same day (September 16). On the following day it lost another 90 points. On Thursday the index gained 183 points but lost 90 points on Friday, the last trading day of the week.

 

 

 

The massive selling in HUBCO turned the sentiments completely bearish and panic selling was witnessed across the board. Though some of the analysts had been hinting towards possible correction for some time but the fall can only be termed unceremonious. A question arises, is the market at the mercy of a few market manipulators?

PAKISTAN OILFIELDS

The company has posted Rs 2,428 million profit after tax for the year ending June 30, 2003 as compared to a profit of Rs 1,946 million for last year. The Board of Directors also approved distribution of 75% final dividend. A 100% interim dividend was paid earlier and the total dividend payout for the year came to 175%. The company had paid 160% dividend for the year 2002. The improvement in profit can be attributed to increase in net sales and decrease in operating costs. Net sales went up from Rs 5,925 million to Rs 6,463 million. Operating costs came down from Rs 2,157 million to Rs 1,803 million. The point worth noting is that the despite announcement of 75% final dividend, its share price came down sharply. The decline in quoted price was said to be due to missing announcement regarding bonus shares. Market was expecting announcement of at least 60% Bonus Shares and when it did not come massive selling of shares triggered fall in its quoted price.

NATIONAL BANK OF PAKISTAN

The bank has posted Rs 1,931 million profit after tax for the first half of year 2003 as compared to a profit of Rs 1,131 million for the corresponding period of last year. The EPS improved from Rs 2.76 to Rs 4.71. Maintaining the tradition, the Board of Directors did not announce any interim dividend. The improvement in bottom line can be attributed to growth in total income, going up from Rs 7,349 million to Rs 9,138 million. However, the benefit was partly eroded due to increase in administrative expenses and other non-interest charges, going up from Rs 3,871 million to Rs 4,305 million. It is believed that a handsome dividend from NIT and increase in dividend income from investment portfolio contributed to higher income of the bank. Yet another contributor to higher profit was absence of amortization of deferred cost. The bank had made a provision of Rs 181 million under this head during the first half of year 2002.

D. G. KHAN CEMENT

The company has posted Rs 483.6 million profit after tax for the year ending June 30, 2003 as compared to a profit of Rs 279.9 million for last year. The increase in bottom line can be attributed to increase in sales and decrease in financial charges. The Board of Directors also approved distribution of 10% among stockholders of ordinary as well as preferred shares. Sales increased from Rs 2,719 million to Rs 2,992 million. However, the benefit was largely eroded due to increase in cost of goods sold, going up from Rs 1,948 million to Rs 2,314 million. The increase in operating expenses also caused reduction in profit of the company. The hike in provision against tax, going up from Rs 14.3 million to Rs 128 million, also led to lower profit.

CHERAT CEMENT

The company succeeded in posting only Rs 9.7 million profit after tax for the year ending June 30, 2003 as against a profit of Rs 138.1 million for the last year. However, a point worth noting is that despite posting such a meager profit the Board of Directors approved distribution of 12.5% dividend amounting to Rs 66.5 million. The company had distributed 25% dividend among its shareholders for the year 2002. The decline in profit can be attributed to higher cost of goods sold. Sales grew from Rs 1,423 million to Rs 1,508 million. As against this cost of goods sold hiked from Rs 1,138 million to Rs 1,358 million. There was increase in operating expenses and an extraordinary expense of Rs 13.5 million regarding cost of voluntary golden handshake. However, reduction in financial charges provided some respite.

 

 

CHERAT PAPERSACKS

The company manufactures papersacks mainly used by the cement industry and has benefited from improved capacity utilization of the cement manufacturers. It has posted Rs 75 million profit after tax for the year ending June 30, 2003 as compared to a profit of Rs 10 million for the last year. As a result of higher profit the shareholders got 110% dividend as against a 30% dividend last year.

MOVEMENT AT A GLANCE

SCRIP

HIGH
(Rs.)

LOW
(Rs.)

CLOSING 
PRICE

TURNOVER
 (SHARE)

P.T.C.L.A

40.20

38.50

39.70

425,772,000

Hub Power

43.90

42.85

43.30

283,118,000

National Bank

49.05

42.50

48.00

136,924,500

D.G.K.Cement

47.10

45.90

46.10

80,259,000

FFC JORDAN

18.75

18.25

18.75

58,516,500

Sui North Gas

46.00

44.80

46.00

58,262,500

M.C.B.

58.75

57.20

57.50

31,017,000

Engro ChemSPOT

96.55

93.85

96.55

15,575,500

Fauji Fert

104.00

101.50

104.00

12,923,300

Sui South Gas

33.00

32.50

32.65

8,355,000