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NETSOL buybacks 250,000 shares to improve EPS
May 19, 2022 (MLN): NetSol Technologies Limited on Thursday announced a buyback of 175,000 ordinary shares of the company in today's trading session of the Pakistan Stock Exchange (PSX) to improve the earnings per share (EPS) and future dividend of the company.
Yesterday, the company had purchased 75,000 ordinary shares of the company, bringing it to 250,000 in two days.
Last week, in an extraordinary general meeting, the members of NetSol had passed the special resolution that the company has been accorded to buyback of its own 2 million issued ordinary shares, having a face value of Rs10 each at spot/current price during the purchase period through PSX.
According to the notice, the purchase period commences from May 18, 2022, to August 08, 2022 (both days inclusive).
Currently, the stock is trading at Rs89, down by Rs1.41 or 1.56% DoD.
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SC bars new appointments, transfers in high-profile cases
May 19, 2022: Supreme Court barred authorities from making new appointments and transferring officials involved in "high-profile" and National Accountability Bureau (NAB) cases as well as those being heard by special courts.
Court also issued notices to the Federal Investigation Agency (FIA) director-general, the NAB chairman and the interior secretary.
The court asked the parties concerned to give an explanation as to why there was "interference" in criminal cases.
Notices were also issued to all the provincial prosecutor generals and the FIA's legal director.
During the hearing, the Chief Justice of Pakistan Umar Ata Bandial observed that there should be "no interference in the prosecution process or the prosecution wing".
The CJP also said that FIA's former director Mohammad Rizwan, who was probing the money laundering charges against Prime Minister Shehbaz Sharif and his son Punjab Chief Minister Hamza Shahbaz, was also transferred and later died of a heart attack.
"We are concerned over these developments," the CJP said. Justice Bandial also stated that according to news reports, "thousands" of people had benefitted after their names were removed from the no-fly list.
"We have been seeing such news reports for the past one month. This has an effect on the rule of law," the CJP said, adding that it was the court's responsibility to maintain peace and trust in society under the Constitution.
The CJP also stated that the suo motu was not meant to embarrass or hold anyone responsible. "It is meant to protect the criminal justice system and the rule of law," he observed.
The court wants the implementation of Article 10-A (right to a fair trial) and Article 4 (due process), he said, adding that notices were being issued to the parties concerned. He also expressed the hope that the federal government would cooperate in providing an explanation.
Press Release
Pak-Turk FMs vow to strengthen economic ties
May 19, 2022: Foreign Minister Bilawal Bhutto Zardari in a meeting with his Turkish counterpart Mevlüt Çavusoglu in New York has expressed commitment to work together to enhance economic cooperation and unleash the full potential of Pak-Turk trade relations.
This was agreed upon on the sidelines of the Ministerial meeting on ‘Global Food Security Call to Action held in New York, Foreign Office said Thursday.
Both sides agreed to remain in close contact to maintain the upward trajectory and add momentum to the friendly ties between Pakistan and Turkey.
Expressing satisfaction over the excellent bilateral partnership between the two countries, FM Bilawal reiterated Pakistan’s resolve to further enhance its wide-ranging cooperation with Turkey.
He noted that in November this year, the 75th anniversary of the establishment of diplomatic relations between Pakistan and Turkey would be celebrated in a befitting manner.
FM Bilawal thanked the Turkish Government for its steadfast support and principled position on the Jammu and Kashmir dispute. He also briefed his counterpart on the so-called “Delimitation Commission” and India’s illegal steps in IIOJK.
Views were also exchanged on various international issues.
Foreign Minister Bilawal appreciated Turkey’s role and contributions toward the promotion of peace and stability in the region.
He appreciated Turkey’s support to address the humanitarian crisis in Afghanistan.
APP
Rs1,949.72mn released for 13 petroleum sector projects in 10 months
May 19, 2022: The government has released funds amounting to Rs1,949.72 million to execute seven ongoing and six new petroleum-related projects during the first 10 months of the current fiscal year under the Public Sector Development Programme (PSDP 2021-22) against a total allocation of Rs3,249.54 million.
Out of the total disbursement of Rs1,949.72 million, around Rs586.54 million have been spent on petroleum projects during a 10-month period (July-April) of the current fiscal year to accelerate oil and gas exploration activities and achieve self-sufficiency in the energy sector, according to official data available with APP.
As per the PSDP document, funds amounting to Rs1,473.683 million had been earmarked for seven ongoing schemes, out of which Rs 263 million were meant for the establishment of the National Minerals Data Centre (NMDC), Rs345.321 for the Expansion and Up-gradation of Pakistan Petroleum Core House (PETCORE), Rs30 million for Geological Mapping on 50 Toposheets, out of 354 unmapped Toposheets of Outcrop Area of Balochistan Province, Rs385.336 million for strengthening and up-gradation of Karachi Laboratories Complex (KLC) at HDIP Operations Office, Karachi, Rs 76.580 million for the supply of 13.5 MMCFD gas at Doorstep (Zero Point) of Dhabeji Special Economic Zone (SEZ) Sindh, Rs 230 million for the supply of 30 MMCFD gas at Doorstep (Zero Point) of Rashakai Special Economic Zone (SEZ) and Rs143.446 million for up-gradation of POL testing facilities of HDIP at Islamabad, Lahore, Multan, Peshawar, Quetta and ISO Certification of Petroleum Testing Laboratory at Islamabad.
Similarly, for six new schemes, the government had earmarked Rs1,775.857 in the PSDP, out of which Rs40 million were kept for the development of Strategic Underground Gas Storages (SUGS) – hiring of consultancy services for Bankable feasibility study and transaction advisory services (PC-II), Rs30 million for Legal Consultancy Services for drafting of Model Mineral Agreement and updating of Regulatory Framework (Federal and Provincial Minerals/Coal Departments) prepared by Mineral Wing, Petroleum Division, Rs40 million for Pakistan National Research Programme on Geological Hazards (Earthquakes and Landslides) - Data Acquisition along Active Faults and Identification of Potential Landslides Hotspot Zones, Rs73.447 million for the supply of 10 MMCFD RLNG to Bostan Special Economic Zone, Rs149.410 million for the supply of 13 MMCFD RLNG to Bin Qasim Industrial Park and Rs785 million for the supply of 40 MMCFD gas/RLNG to Allama Iqbal Industrial City Special Economic Zone (SEZ).
APP
Unity Foods fully utilizes right issue’s proceeds worth Rs5.4bn
May 19, 2022 (MLN): Unity Foods Limited has informed that the proceeds of the fourth right issue of the company for Rs5.4 billion have been fully utilized to meet the increased working capital requirements.
According to the notice issued to PSX, the right issue proceeds immediately on transfer to the bank account of the company have been part of the working capital of the company.
The proceeds have been utilized primarily for the purposes of purchase of inventories (part of working capital) and there has been no deviation from the announcement made.
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Sri Lanka falls into default, likely to witness inflation surge to 40%
May 19, 2022 (MLN): Sri Lanka has defaulted for the first time in its history as the government struggles to halt an economic crisis that has sparked widespread protests and a political crisis, as reported by Bloomberg.
Policymakers had flagged to creditors that the nation wouldn’t be able to make payments until the debt is restructured, and is therefore in pre-emptive default, central bank Governor Nandalal Weerasinghe said at a briefing Thursday.
An economic crisis unprecedented in the country's history since independence in 1948 has led to a critical shortage of foreign exchange, that saw it miss two coupon payments on sovereign bonds on April 18. They were worth $78 million combined on notes due in 2023 and 2028, with a 30-day grace period that expired on Wednesday.
Sri Lanka has been mired in turmoil amid surging inflation -- which Weerasinghe sees accelerating to 40% in coming months -- a plummeting currency and an economic crisis that has left the country short of the hard currency it needs to import food and fuel, it said.
Public anger has boiled over into violent protests and led the government to announce last month it would halt payments on its $12.6 billion pile of foreign debt to preserve cash for essential goods.
Many of Sri Lanka’s bonds have so-called cross-default clauses, which drag all the outstanding dollar debt into default if there’s a missed payment in a single bond. On the debt due in 2023 and 2028, the clause is triggered if any payment that exceeds $25 million is not met. The country was already declared in selective default by S&P Global Ratings in late April, it cited.
Meanwhile, the country is in talks with the International Monetary Fund (IMF) for a bailout and needs to negotiate a debt restructuring with creditors. Sri Lanka has previously said it needs between $3 billion and $4 billion this year to pull itself out of crisis.
“It’s not a surprise,” said Guido Chamorro, the co-head of emerging-market hard-currency debt at Pictet Asset Management, which holds Sri Lankan bonds. “It was well flagged and mostly priced with most bonds priced in the high 30s.”
Weerasinghe said on Thursday that he’d like to see a finance minister appointed to sign off on any aid agreements. However, the political situation has improved with the appointment of a Prime Minister and Weerasinghe says that gives him comfort to continue in the job. Last week he had threatened to quit if political stability doesn’t return soon.
Tighter global credit brought about by a litany of factors -- Federal Reserve interest rate hikes, soaring commodity costs, the war in Ukraine -- have had a devastating effect on the low-income country, which is the biggest sovereign issuer of junk dollar bonds in Asia. And all that’s after the pandemic reduced tourism earnings by more than three quarters.
As per the report, Sri Lanka’s bonds were mixed on Thursday but higher than their record lows reached last week, suggesting traders expect better recovery values. Dollar bonds due in 2030 were indicated 0.28 cents lower at 38.39 cents on the dollar and notes due in July were 0.22 cents higher at 42.78 cents, according to data compiled by Bloomberg. The Colombo All-Share Index slumped more than 3% amid a global equity selloff.
“Defaults are not the end, they can signal a new beginning,” said Chamorro. “Now the hard work begins.”
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India warns of fuel-supply cuts to utilities if coal imports delayed
May 19, 2022: India's power ministry on Wednesday said it would cut domestic fuel supply to state government-run utilities by 5% if they do not import coal for blending by June 15, as officials struggle to address rising power demand.
A heatwave pushed power use to a record high in April, leading to the worst electricity crisis in more than six years and forcing India to reverse a policy to slash coal imports.
The power ministry said lower imports by states was "the cause of the stress in the availability of coal," and said states' efforts were "not satisfactory." Coal imports for blending fell by a fifth to 8.3 million tonnes during the financial year through March, the ministry said.
"If blending with domestic coal is not started by 15.06.2022 then the domestic allocation of the concerned defaulter thermal power plants will be further reduced by 5%," the power ministry said in a statement.
India had set state and federal government-run utilities a target to import 10% of their coal needs for blending with domestic coal.
The power ministry had asked all utilities to ensure delivery of 50% of the allocated quantity by June 30, another 40% by end-August and the remaining 10% by the end of October.
It said state government-run utilities, most of which are debt-laden, will have to import more coal to fire their power plants due to reduced local supply if they delay placing orders and supplies do not arrive by June 15.
"All the defaulter generating companies would have to import coal for blending purposes to the extent of 15%," the ministry said.
"Not much blending has taken place in the months of April and May," it noted and said plants that have not yet started blending must ensure they use a 15% blend of coal until October and a 10% blend from November until March 2023.
Reuters
Telecard pays Rs110.43mn to its TFC holders
May 19, 2022 (MLN): Telecard Limited (TELE), has paid Rs110.428 million to its Term Finance Certificate Holders ('TFC Holders') by using the proceeds of Rs200 million against its Offer for Sale (OFS) thus making 03 principal quarterly repayments through a single bullet payment, the company's filing on PSX showed on Thursday.
To note, the amount raised through the Initial Offering of Supernet Limited Shares (SNL), a subsidiary of Telecard, was Rs475mn out of which TELE received Rs200 against its OFS.
All in all, TELE has repaid Rs144mn to the TFC Holders in the current calendar year.
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Update: PKR breaches 200/USD mark
May 19, 2022 (MLN): Hitting an all-time historic low, the Pakistani rupee (PKR) has crossed the mark of 200 against the greenback in the intraday trade, plummeting by 1.61 rupees compared to the previous close of PKR 198.39 per USD.
The rupee was quoted at 200/200.05 (11:20 PST) with trades reported at 200.
Meanwhile, within the open market, PKR was traded at 199.50/201.50 per USD.
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Global fiscal recovery to slow in 2022 and 2023, says Fitch
May 19, 2022 (MLN): The global fiscal recovery in 2021 that followed the Covid-19 shock of 2020 has slowed sharply, affected by higher commodity prices, rising inflation more generally, increased borrowing costs, slowing real GDP growth and the war in Ukraine, says Fitch Ratings.
In its latest report, the rating agency said that higher inflation accompanied by slowing economic growth does not represent the same policy dilemma to the fiscal authorities as it does to central banks.
In its March Global Economic Outlook, Fitch highlighted the pick-up in US services inflation and rising wage inflation. Additionally, there is a
growing risk of inflation expectations becoming unanchored from the Federal Reserve’s 2% inflation target. These considerations speak to the possibility of higher inflation lasting for an extended period.
Monetary policy is typically associated with the official sector’s response to higher inflation, but there is also fiscal policy to consider. As of March, 66 of 120 Fitch-rated sovereigns have already introduced fiscal support measures to help households and businesses cope with accelerating prices, and more such policies are expected if prices remain elevated.
“With inflation continuing to exceed expectations in many countries, we expect additional fiscal measures to be introduced and the fiscal burden of inflation to grow.”
The rating agency noted that Policy interest rates are rising, and this marks an end to the era of very low government borrowing costs, which have primarily benefitted developed-market sovereigns.
“Even so, it is real interest rates that matter for growth, and real rates relative to real GDP growth that matter for government debt dynamics. Long debt maturities imply rising interest-service burdens will materialize only gradually,” Fitch said.
The rating agency stated that emerging-market fiscal positions are more divergent than they were pre-pandemic. This is due in part to the surge in commodity prices that is supporting government revenue and nominal GDP growth in commodity-exporting regions, including the Gulf Cooperation Council and Latin America.
With greater fiscal divergence has come greater rating divergence. The number of sovereigns rated ‘CCC’ or lower has been at or near a historical high since late-2020.
Current global credit conditions and those expected by Fitch for the next year suggest continued fiscal and rating stresses ahead, it added.
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