The Karachi Stock Exchange (KSE) has granted
clearance to the offer for sale documents of the forthcoming Initial
Public Offering (IPO) of the Oil and Gas Development Company Limited (OGDCL).
Moin Fudda, Managing Director KSE has expressed the
hope that the OGDCL would be the largest public offering after PTCL.
It would significantly add to the existing depth of the capital
markets of the country and also add a new dimension to investors'
interest in the market activity.
The new listing would offer 107,523 million shares
i.e. 2.5 percent of face value of Rs10 each at a premium of Rs22 per
share that means that the offer would be Rs32 per share. This would be
a substantial addition to the existing market capitalization base of
the Karachi Stock Exchange that is likely to exceed Rs one trillion
Despite the fact that the share market has been
passing through a bumpy road marked by sharp ups and downs for quite
sometimes, Ahmed Baloch, Chief Executive of White House Securities was
of the opinion that the coming events of listing state-owned entities,
having tremendous financial results to their credit are likely to give
sound footings and depth to the stock market but certainly elevate the
stature of the share business to the international level.
While recommending the forthcoming OGDCL and SSGC
as the sound and safe investment in the backdrop of their financial
performance and the growing role of the gas sector in Pakistan's
economy, Ahmed Baloch had some reservations over the offering of NBP
shares at Rs46 which he feels on a higher side and may hardly call for
a green shoe option this time.
Ahmed Baloch, however, appreciated the good
economic decisions of the present government specially by the Security
and Exchange Commission of Pakistan for its efforts for introduction
of prudent measures for protection of the interest of the investors
and strict discipline and innovative ideas in the capital market.
He attributed the recent trade fluctuations at the
Karachi Stock Exchange mainly to law and order situation within the
country while mounting tense situation across the border both on India
and Afghanistan. As soon as the situation normalises, the trade at the
capital market is likely to march towards its ultimately goal of
crossing the mark of 5000 points at KSE index hopefully by the end of
the current financial year.
Addressing the investors at a conference in
Karachi, Dr. Hafiz Sheikh was optimistic about tremendous market
capitalization to the tune of $20 billion from existing level of
$17-18 billion, an impressive reinforcement worth $2 billion to the
existing market strength.
The time has come when the international investors
have to look towards Pakistan seriously because they seldom consider
markets with less than $20 billion capitalization for investments. Dr.
Hafiz Sheikh was of the opinion that the initial 2.5 percent shares
plus an equivalent size of green shoe option would provide around Rs7
billion to the government.
The listing of the OGDCL shares was being scheduled
for the last week of October or the first week of November that the
investors may have enough time to withdraw their investment back in
case they could not by the shares of National Bank of Pakistan. The
public offering of NBP shares would take place on October 1-15.
The government had lined up the IPOs of Sui
Southern Gas Company (SSGC) and Pakistan International Airlines (PIA)
by December this year. Once these transactions are materialized, the
government would announce the schedule of the next quarter for the
IPOs of Pakistan State Oil (PSO), Habib Bank Ltd (HBL), National
Investment Trust (NIT) and two power companies including Faisalabad
Electric Supply Company and Jamshoro Power Generation Company.
OGDCL, it may be noted, had earned a record profits
during the last two yeas due to the government's decision to allow the
company to function purely on commercial lines under an independent
board of director.
It would be the second largest listing of any
state-owned entity on stock market after the Pakistan
Telecommunication Company Limited (PTCL). There is no sign of a major
drop in international oil prices, which could reduce the share rise of
Afzal Khan, the chairman OGDCL Board of Directors
says that the company had contributed a record Rs33 billion revenues
showing how the company was earning profits.
Dr. Hassan, the chairman of the Securities and
Exchange Commission of Pakistan (SECP) while highlighting the
potential for growth in the mutual funds industry to facilitate the
stock markets said that the mutual funds can serve as an effective
intermediate for achieving a real depth and breadth of bourses.
He said that as technology was altering and
expanding traditional trading mechanism, so too was technology
revolution in the dissemination of information.
Inaugurating the display only terminals (DOT), SECP
chief said that he hoped that DOTs would not only facilitate investors
by providing quick, up to date and reliable market data with summate
ease, but also help achieving the objectives of the SECP through
widespread and timely disclosure of market related information.
The DOTs have been introduced by the KSE in
collaboration with Cyber Internet Services to offer customers access
to the Karachi Automated Trading Systems (KATS) screens. Through an
agreement between Cyber Net and KSE, the former would be hosting DOT
at their data centers in Karachi, Lahore, Islamabad and Faisalabad in
the first phase, which would be extended to other cities later on.