FFC tops KSE-100 with largest market capitalization

September 24, 2024 (MLN): Fauji Fertilizer Company Limited (PSX: FFC) has emerged as the company with the largest market capitalization among the constituents of the KSE-100 index, the key gauge of the Pakistan Stock Exchange (PSX).

In today's session, FFC’s market capitalization reached a staggering Rs152.89 billion, taking its weightage in the KSE-100 index to 6.06%.

The fertilizer giant is currently riding the upward rally, taking its calendar year gain to 93.55%, while for the fiscal year, it stands at an impressive 33.34%.

One factor driving the rally is the consistently strong profits reported by the company, attributed to robust urea and DAP sales.

FFC’s earnings in the second quarter of 2024 jumped almost three times, posting a profit after tax of Rs15.55 billion.

Along with the results, the company announced an interim cash dividend of Rs10 per share, pumping the scrip price further.

Notably, the sole reason for the company scaling up is the board's approval of the merger between FFC and Fauji Fertilizer Bin Qasim Limited (PSX: FFBL), marking a massive development in the fertilizer sector.

As consideration for this merger, approximately 150.87 million ordinary shares of FFC will be allotted and issued to the shareholders of FFBL, excluding shares held by FFC itself as a shareholder of FFBL.

Consequently, FFBL will stand dissolved without winding up, and all shares of FFBL, including those held by FFC, will be canceled.

As per the scheme, FFBL will get 1 for 4.29 shares after its merger with FFC.

Post-merger, the new entity will strengthen its presence in the sector by dominating the local urea and DAP markets.

To further reinforce FFC's position, the board has also approved the acquisition of shares and control in Agritech Limited (AGL) along with any associated company(ies). 

Given these significant developments and growth actions being taken by the company, it is no surprise that the stock continues to perform well, positioning it to be a leading player.

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