STOCK WATCH

 

 

By SHABBIR H. KAZMI
Updated November  22, 2003

 

The market remained lackluster during the week mainly due to subscription of public offer of Oil & Gas Development Company (OGDC). Reportedly the public offer has been oversubscribed heavily. At the fagged-end of Ramazan, volume also remained low. Badla volume and investment declined considerably. Not much of activity is expected in the next week. It is yet to be seen how the market behaves after Eid. The overall expectation is that the market may remain volatile for a few more weeks till the amount is refunded to unsuccessful subscribers of OGDC.

 

RECKITT BENCKISER

 

 

Reckitt Benckiser has acquired another 3,307,336 shares of Reckitt Benckiser Pakistan from National Investment Trust (NIT). As a result of this acquisition, Reckitt's holding in the company goes up to 21,936232 shares or 58.43% of the total outstanding shares. According to market sources, it is anticipated that the company may opt for voluntary delisting. The existing shareholders may benefit from the delisting but the general public will be the loser. The Karachi Stock Exchange will also miss a blue chip company from its list. However, some analysts say it may be preamble for a substantial Bonus Shares issue. It is yet to be seen how the company makes the next move.

BOC PAKISTAN

The company has posted Rs 364 million profit after tax for the year ending September 30, 2003 as compared to Rs 301 million profit for last year. However, the accounts deserve a closer look. Though, sales went up but gross profit declined due to hike in cost of sales. Sales grew from Rs 1,359 million to Rs 1,386 million. Cost of sales went up from Rs 749 million to Rs 801 million. Increase in operating expenses, from Rs 196 million to Rs 208 also contributed towards lower operating profit, going down from Rs 414 million to Rs 377 million. However, growth in other income, going up from Rs 15 million to Rs 74 million contributed towards improvement in bottom line. Reduction in financial and other charges further improved profit after tax.

FAZAL TEXTILE MILLS

The company has posted Rs 87 million profit after tax for the year ending September 30, 2003 as compared to Rs 44 million profit for the last year. However, it seems disappointing that the Board of Directors approved distribution of 10% dividend among the shareholders amounting to Rs 6.188 million. Nearly 100% increase in profit can be attributed to growth in sales, going up from Rs 1,916 million to Rs 2,061 million. Better cost controls and reduction in administrative, selling and financial expenses also helped in improving the bottom line. However, the benefit was eroded due to decrease in other income and increase in other charges.

VALIKA ART FABRICS

The company seems to have stopped its core activity and gone into warehousing business. The storage income for the quarter ending September 30, 2003 was as low as Rs 765 million as compared to an income of Rs 1,050 million for the corresponding period of year 2002. Financial charges skyrocketed from Rs 0.108 million to Rs 23.7 million. Financial charges came down from Rs 916 million to Rs 713 million. However, reduction in warehousing income plunged profit after tax from Rs 87 million to Rs 18 million. The bottom line improved due to lower provision against tax, declining from Rs 47 million to Rs 9.7 million. EPS for the quarter under review came to Rs 0.059 as compared to Rs 0.287 for the corresponding quarter of last year.

 

 

ALTERN ENERGY

The company has posted Rs 4.7 million profit before tax for the year ending June 30, 2003 as compared to Rs 6.3 million loss before tax for the last year. This improvement can be attributed to better control on cost of sales. Sales declined marginally from Rs 169.8 million to 166.2 million. As against this cost of sales came down from Rs 132 million to Rs 115 million. As a result of correction of financial error amounting to over Rs 20 million, the company succeeded in bringing down its accumulated losses. However, it is beyond comprehension that loss carried forward at the end of last financial year was stated at Rs 9.88 million but in profit and loss statement for the year under review the amount of loss brought forward was stated at Rs 30.6 million.

SALEEM SUGAR MILLS

In an Extraordinary General Meeting the majority shareholders decided to reconstitute the Board of Directors of the company by electing the new directors and removing the existing directors including the Chief Executive. Apart from other allegations, it has been stated that ousted group/management failed to publish and circulate statutory reports. At the meeting it was also resolved that a legal notice be served on the ousted directors to surrender all properties, plant and machinery, spares unlawfully removed from the factory. This seems to be a rather unusual move in Pakistani context. It is yet to be seen how the ousted group reacts.

MOVEMENT AT A GLANCE

SCRIP

HIGH
(Rs.)

LOW
(Rs.)

CLOSING 
PRICE

TURNOVER
 (SHARE)

Oil & Gas Deve.

41.20

39.55

40.60

127,592,000

FFC JORDAN

18.95

18.35

18.90

62,109,500

P.S.O.

270.30

260.20

270.30

48,538,500

Bosicor Pak

28.70

23.15

27.45

36,685,000

Hub Power

35.70

34.90

35.70

32,020,000

P.T.C.L.A

33.45

32.35

33.45

31,074,500

National Bank

45.65

44.80

45.65

10,258,500

M.C.B.

44.75

43.80

44.75

3,751,500

Fauji Fert

85.75

84.10

85.75

2,238,900

Engro Chem

82.75

81.50

82.75

1,585,800