GOVT LOWERS COTTON CROP
ESTIMATE BY 2.5M BALES
The federal government has
revised its cotton crop production estimate downward by conceding
that the crop was likely to be short by about 2.5 million bales of
its ambitious original target of 15m bales.
But experts and many
farmers, including progressive growers feel that the final output
may be further scuttled by another one to two million bales.
They also describe that the
revision as belated because the state of the crop had been known for
some weeks. A reduced yield was indeed on the cards after rains and
windstorm in the first week of September that caused widespread
flower shedding and as temperature was high with matching humidity
during crucial stages of the crop's development undermined the crop.
High temperature with low
humidity is conducive for the crop's growth but it is damaged when
both factors are on the higher side. That has happened to the crop
that is now being harvested.
Another aspect of the crop
worrying farmers is apprehension that that the weight of the produce
would be somewhat less than it is on an average year. What exactly
has happened can be identified by analyses only but experts are of
the view that the final output is likely to be undermined by this
At his press conference in
Islamabad, the Federal Minister for Food, Agriculture and Livestock,
Sikandar Hayat Bosan, said that monsoon floods vastly destroyed the
crop in three districts of southern Punjab that forms the cotton
belt of the province. The districts are Rahimyar Khan, Layyah and
However, they weren't the
only cotton growing areas affected by weather. A high velocity
windstorm and not floods had hit the crop in most of the cotton
regions of Punjab. This has already been reported in the press and
the authorities should have assessed the situation earlier, experts
SIX FIRMS ANNOUNCE RESULTS
As the mandatory one month
from the end of quarter ended September 30 almost draws to close,
financial results of companies start pouring in. On Tuesday last
several companies declared results.
Shell Pakistan posted a
profit after tax (PAT) at Rs982 million for the quarter ended
September 30, 2005, compared with Rs651 million earned in the same
period last year.
Nestle Pakistan made a
profit of Rs845 million on sales valued at Rs12.8 billion for
3Q2005, compared with PAT at Rs769 million on sales worth Rs9.7
billion in the comparable period last year. GlaxoSmithKline posted a
PAT of Rs1,235 billion on sales valued at Rs6,923 billion. This
compared with PAT of Rs1,164 billion on a turnover of Rs6,803
Earlier on Monday, Pakistan
Oilfields announced a PAT at Rs1,441 million for three months ended
Sept 30, showing a growth from Rs660 million in the same time last
Askari Commercial Bank
announced a PAT at Rs1,434 million for nine months ended Sept 30,
2005, compared with Rs1,513 million in the same time last year.
Indus Motors reported 1Q05
PAT at Rs466 million on net sales valued at Rs7,108 million, up from
Rs368 million on sales of Rs6,521 million. That translated into eps
at Rs5.93, compared with Rs4.69 in last comparable period.
Boards of directors to
announce results on Wednesday and Thursday include those of Fauji
Fertilizer Company, Engro Chemicals, Sui Southern Gas Company,
Pakistan Petroleum Limited, Bank of Punjab, DG Khan Cement, Unilever,
Nishat Mills, PTCL and others.
BANKS SEE LOW INTEREST
Banks on Wednesday last
invested huge money in 12-month treasury bills in anticipation of a
reduction in interest rates in near future.
The State Bank, which held
an auction of treasury bills for all three maturities and set a
small target of Rs5 billion, went far beyond its target as it found
offered rates attractive and within its target.
However, these huge
investments by the banks at this stage when the money market looks
short of liquidity reflected their approach towards interest rates.
Analysts said the banks
invested Rs13.425 billion in T-bills of 12-month maturity, with a
hope that the interest rates would decline in future. The cut-off
yield for the 12-month paper was 8.79 per cent. The State Bank
picked up Rs4.81 billion for three-month and Rs240 million for
six-month T-bills at a cut-off yield of 8.1 per cent and 8.13 per
cent per annum, respectively. The cut-off yields on all three
maturities remained unchanged. The banks have offered a total of
Rs26.506 billion for T-bills.
$12BN PLAN FOR
The government is working
on a $10-12 billion reconstruction plan for the quake-stricken
regions of Azad Kashmir and the NWFP. According to a newspaper
report, the government would arrange about 45 per cent funding
(roughly $5 billion) for the plan which is expected to be submitted
to the president and the prime minister on November 15 for approval.
The government expects that
a donors' conference in Geneva will contribute substantial grants to
help Pakistan rebuild roads, bridges, schools and colleges,
hospitals, government offices and villages in the quake-hit areas.
The pledges of about $1.2
billion had been made and the government was expecting $4 billion
from international donors and bilateral creditors before the end of
November to effectively execute the plan, it added.
DELHI OFFERS $25 MILLION
FOR QUAKE VICTIMS
India said it had offered
an assistance of $25 million to Pakistan for relief and
rehabilitation of earthquake victims. An Indian foreign ministry
spokesman said the commitment was made by Junior Indian Minister
Oscar Fernandes in Geneva. Mr Fernandes represented India at a
meeting for earthquake relief to Pakistan organized by the UN Office
of the Coordinator for Humanitarian Affairs at Geneva.
"The Government of
Pakistan would be welcome to use this contribution for rebuilding
homes and rehabilitating people, reconstructing the infrastructure
and restoring essential services," the spokesman said.
PRIVATE-SECTOR DRIVE FOR AID
US President George W. Bush
has said that executives from some of the world's best-known firms
would spearhead efforts to raise private-sector aid for victims of
the massive earthquake in Pakistan.
"In the coming days,
they will ask Americans to donate directly to a fund set up to
provide help to the earthquake victims," Mr Bush said in a
statement released by the White House.
The executives leading the
aid drive were Jeff Immelt, chairman and chief executive of General
Electric; Hank McKinnell, chairman and CEO of Pfizer; Sandy Weill,
chairman of Citigroup; Anne Mulcahy, chairman and CEO of Xerox; and
Jim Kelly, former chairman and CEO of United Parcel Service of
America, Mr Bush said.
PPIB OKAYS THERMAL PROJECTS
The federal government has
approved setting up of about 3,000-mw of thermal power projects in
the private sector with an estimated total investment of more than
A decision to this effect
was taken at a meeting of the board of directors of Private Power
and Infrastructure Board (PPIB) presided over by Minister for Water
and Power Liaqat Ali Jatoi.
The board also decided to
process the project proposals on a fast track basis to avoid power
shortfalls in the next couple of years.
The board decided to issue
letters of support (LoS) to 200-mw Orient Power Project to be
located at Balloki near Lahore and 123-mw Star Power Project at
Daharki in Sindh. The construction work on these two projects would
start in a couple of months.
The PPIB board also
approved in principle the issuance of letters of interest (LoIs) to
five independent power producers (IPPs), which are already operating
in the country, to set up additional plants of 1,125-mw.
MILLS BUILDING UP LONG
The cotton market showed a
firm trend as mills continued to build up long positions at the
current levels fearing further increase in prices.
As a result, physical
business expanded to about 20,000 bales, mostly from Punjab
ginneries, interesting feature being that bulk of the business was
finalized below or around Rs2,400 per maund.
SBP DESIGNS FRAMEWORK FOR
The State Bank has designed
stress-testing framework for all banks and DFIs to improve risk
management capacity to ensure the financial health of these
The SBP issued a set of
guidelines for banks and DFIs for the strengthening of risk
management skills. The circular said that the financial institutions
all over the world were increasingly employing sophisticated
techniques for managing risks. Stress-testing is one of such
techniques, which has been used to assess risk exposures across the
institution and to estimate the changes in the value of the
portfolio, if exposed to various risk factors.
"Keeping in view the
divergence of skill level and available resources among banks and
DFIs, the model, initially, focuses on "Simple Sensitivity
Analysis". However, with the increasing know-how and
availability of more data the model will over the time undergo
further refinement," said the circular.
PPL PROFIT RISES
At the annual general
meeting of Pakistan Petroleum Limited, directors told shareholders
that PPL had earned an after tax profit for the year 2004-05
(July-June) amounting to Rs8.6 billion, reflecting an improvement of
30 per cent over the previous year. Earning per share stood at
Rs12.57 for the latest year and Rs9.65 for 2003-04.
PICIC FINANCIAL RESULTS
PICIC Asset Management
Company Ltd - investment adviser to PICIC Investment Fund (PIF) and
PICIC Growth Fund (PGF) -- announced results of the funds for 1Q05
ending Sept 30.
In a press statement, the
management company stated that during the quarter under review,
total income increased to Rs774 million as compared to a loss of
Rs112 million in the corresponding period last year, showing a
growth of 791 per cent, which also included realized capital gains
on account of NRL privatization.
PIF declared an interim
cash dividend at 10 per cent (Re1 per certificate), resulting in a
cash payout of Rs284 million for the quarter. PGF declared an
interim cash dividend at 15 per cent (Rs1.5 per certificate) and an
interim bonus at 20 per cent, resulting in a payout of Rs551
DOLLAR FALLS BELOW RS60
AFTER SIX MONTHS
The greenback on Wednesday
last slipped below Rs60 after six months in the open market as
sellers rushed to liquidate their holdings, said currency dealers.
They said that the flow of
donations had accelerated from all over the world for earthquake
victims and the exchange companies were busy in making pay orders
for liquidating the dollars into rupees.
The US dollar on Wednesday
traded at Rs59.90 in the open market and in the inter-bank market it
stood at Rs59.74 to a dollar, the level last time hit on April 25
PIA'S REVENUE UP
The PIA's Board of
Directors meeting was held under the chairmanship of Tariq Kirmani
to review the recent performance and future plans of the national
It said aggregate revenue
was recorded at Rs15,981 million in this quarter as against Rs14,556
million last year, denoting an improvement of Rs1,425 million.
GERMANY APPROVES ENERGY
The German Ministry of
Economic Cooperation (BMZ) has approved the Renewable Energy and
Energy Efficiency (REEE) project for Pakistan. It was disclosed by
Guntram Glassbrenner, an energy efficiency expert from German
Development Cooperation-GTZ, in a meeting with Small and Medium
Enterprise Development Authority experts at Smeda head office .
Mr Guntram was accompanied
by Martin Kruska, head Climate Change Services of EUTECH, a leading
German company dealing in energy management.
Pre-tax profit of Allied
Bank jumped by 20 times to Rs3.394 billion during the third quarter
ended September 30, 2005, as compared to Rs163 million in the same
period last year.