FOREIGN INVESTORS KEEN TO BID FOR NIT

Pre-bid meeting on April 24

SADAF AURANGZAIB, Senior Correspondent
Apr 23 - 29, 2007

NIT has once again outperformed the KSE 100 Index by an equitable margin of 1.82% where net asset value of NIT unit has increased by 14.65% from Rs 43.07 as on June 30, 2006 (ex- dividend) to Rs 49.38 as on March 31, 2007 against an increase of 12.84% in KSE 100 index during the period under review.

Tariq Iqbal Khan, Chairman & MD NIT, stated this after the Board of Directors of National Investment Trust Ltd approved the accounts for nine months ended March 31, 2007.

The display of outstanding performance by NIT is well timed especially when the Privatization Commission has set a pre-bid meeting on April 24 with 15 pre-qualified parties for the sell-off of the National Investment Trust (NIT), Pakistan's largest mutual fund whose worth is estimated at over Rs 80 billion.

The government has decided to separate the units (possession of units) of National Bank of Pakistan (NBP), Faysal Bank, Bank of Punjab and Bank of Khyber, which already possess around Rs 40 billion of its assets through the government's letters of comfort (LoC).

•The share of the four major participants and LoC holders has been separated from April 1, 2007. The participants cannot offer bids for such assets, but the four LoC holders can offer bids for the remaining shares.

Meanwhile, the net income earned by the fund during the nine months ended on March 31, 2007 stood at Rs.4.57 billion which translates into earning per unit of Rs. 2.88. It may be mentioned here that the net income of Rs. 8.22 billion earned by the fund during the corresponding period of last year included a capital gain of Rs. 5.128 billion earned from the sale of strategic holding of National Refinery Limited through Privatization Commission. Thus, the net income of the fund excluding capital gain of National Refinery Ltd during the corresponding period of last year increased by 47.6%.

The dividend income of the trust stood at Rs. 2.41 billion during the first nine months ended on 31.03.2007, which is around the level of dividend income earned by the fund in the corresponding period of last year.

Referring to the nine months result, the chairman said that capital gains realized during the nine months, ended on 31st March 2007, stood at Rs. 2.67 billion against Rs. 650 billion in the corresponding period of last year. However, the capital gains realized in the corresponding period of previous year included a hefty amount of Rs. 5.128 billion earned by the fund on account of strategic sale of shareholding of National Refinery Ltd. Capital gains excluding the gain of National Refinery Ltd in corresponding period of last year increased by 94.87%.

The net assets under management has increased from Rs. 64.30 billion as on June 30, 2006 to Rs. 78.25 billion as of March 31, 2007, reflecting a strong growth of 21. 70%.

As against the sale of NIT units (including ClP) worth Rs. 2.51 billion registered during the nine months ended on March 31, 2006, the sale of NIT units (including ClP) during the nine months ended on March 31, 2007 stood at Rs. 7.62 billion, depicting a huge increase of 203.90%. NIT units worth Rs. 3.69 billion were redeemed during the nine months ended March 31, 2007 against redemption of NIT units worth Rs 9.61 billion in the corresponding period of previous year. This sale/repurchase of NIT units indicates the growing confidence of investors in the trust.