Tag: COMMODITIES

January 25, 2022 (MLN): Kot Addu Power Company Limited (KAPCO) has announced an interim cash dividend of Rs4 per share i.e., 40% for the year ending June 30, 2022, the company’s filing on bourse showed today.

The above entitlement will be paid to the shareholders whose names appear on the Register of Members on February 8, 2022, the notice said.

To recall, last year in November, the company received Rs59.401 billion from the power purchaser in the form of one-third cash, one-third government Ijara Sukuk, and one-third Pakistan Investment Bonds (PIBs).

This constitutes the second instalment of 60% of receivables at the cut-off date of November 30, 2020, the notice added.

At the time of reporting this, the company’s share price stood at Rs34.72, with a market cap of Rs16.12 billion.

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January 25, 2022 (MLN): Honda Atlas Cars Pakistan (HCAR) has posted a 2.6x YoY increase in net profits to Rs2.3 billion during 9MCY21 compared to the profits of Rs897.6 million in the corresponding period last year.

This is reflected in the company’s earnings per share which went up to Rs16.2 from Rs6.29 last year.

The increase in profitability was driven by a 73% YoY increase in sales volume where the key revenue driver remains the new model euphoria of Honda City.

To recall, at the beginning of 3QCY21, HCAR launched the 6th generation City in Pakistan, which received a tremendous response from car buyers across Pakistan.

The jump in car sales was due to improved economic activity along with lower interest rates favouring the automobile sector.

Despite the increase in car prices, the gross margins of the company dipped to 5% from 6% last year, mainly attributable to the depreciation of PKR against USD.

The other income of the company inflated by 3.4x YoY to Rs1.38bn on account increase in cash and short-term investments and an increase in the policy rate by 275bps.

On the cost side, the distribution cost went up by 25% YoY whereas administrative expenses jumped by 37% to stand at Rs750.4mn.

Moreover, the company witnessed a sharp 60% YoY decline in its finance cost to Rs55.6mn as compared to Rs140.2mn during the same period last year.

At the time of writing this report, HCAR’s scrip at the bourse was trading at Rs209.72, down by Rs5.02 or 2.34% DoD on Tuesday.

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January 25, 2022 (MLN): Pakistani rupee (PKR) continued its downward journey on the second consecutive session against the US dollar as the currency settled the trade at PKR 176.72, depreciating by 23 paisa in today's interbank session.

In the previous session, the local unit had closed at PKR 176.49 per USD after losing 25 paisa.

The rupee endured a relatively dull trading session with very little intraday movement, trading in a range of 10 paisa per USD showing an intraday high bid of 176.70 and an intraday low offer of 176.45.

The MPC in its yesterday’s meeting kept the policy rate unchanged at 9.75% as SBP is very comfortable with the fiscal and monetary policy mix & thinks it is helping to ease inflationary pressure, Asad Rizvi, the former Treasury Head at Chase Manhattan noted.

The status quo decision of MPC will likely deteriorate the current account balance which would eventually put more pressure on PKR.

However, PKR performed slightly better during one month as the currency improved by 1.07%, 0.80%, 0.79%, 0.69%, and 0.60% against EUR, AED, USD, SAR, and CHF, respectively.

It is pertinent to mention that 30-days rupee-dollar parity is less volatile as the local unit is less responsive to economic events. Plus, the capped dollar demand on the eve of the new year played a significant role in the PKR stabilization.

To note, CY2021 proved to be particularly volatile as the rupee closed to a historic low of 178.23 against the US dollar on December 29, 2021.

From July’21 to date, the local unit has lost Rs19.17 against the USD. Similarly, the rupee lost its ground by 20 paisa in CY22, with the month-to-date (MTD) position showing a drop of 0.12%, as per data compiled by Mettis Global.

Alternatively, the currency gained 83 paisa against the Pound Sterling as the day's closing quote stood at PKR 238.31 per GBP, while the previous session closed at PKR 239.14 per GBP.

Similarly, PKR's value strengthened by 9 paisa against EUR which closed at PKR 199.8 at the interbank today.

On another note, within the money market, the State Bank of Pakistan (SBP) conducted an Open Market Operation (OMO) in which it injected Rs250 billion into the market for 3 days at 9.85 percent.

The overnight repo rate towards the close of the session was 9.70/9.90 percent, whereas the 1-week rate was 9.85/9.95 percent.

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January 25, 2022: European stocks rebounded Tuesday in opening deals on the eve of a Federal Reserve monetary policy decision, after tumbling the previous day on Ukraine tensions and US rate hike fears.

London's benchmark FTSE 100 index of major blue-chip companies won 0.7 percent to 7,345.34 points compared with the closing level on Monday.

In the eurozone, Frankfurt's DAX added 0.6 percent to 15,096.24 points and the Paris CAC 40 gained one percent to stand at 6,854.76.

"Volatility is likely to prevail for the moment, with tensions between Russia and Ukraine unsettling investor sentiment, and with the imminent Federal Reserve meeting likely to have a major impact on the short term direction," said Interactive Investor analyst Richard Hunter.

Asian indices plunged Tuesday following a highly volatile day on Wall Street fuelled by fears about the Fed's plans to hike borrowing costs.

Global equities were spooked Monday with London diving 2.6 percent while Frankfurt and Paris had each tumbled by almost four percent.

Wall Street stocks, however, staged a feverish comeback Monday after stumbling to multi-month lows.

Heightened concern about Russia's troop build-up on Ukraine's border has weighed on investor sentiment, alongside a disappointing start to the corporate earnings season.

AFP/APP

January 25, 2022 (MLN): Crescent Star Insurance Limited (CSIL) intends to raise Rs1 billion to clear the bank defaulted amount of Dost Steel Limited (DSL) and provide working capital required for the operations of DSL, subject to the issuance of 78.66 million shares and regulatory approvals, the company’s filing on PSX showed today.

As per the notice, these options are currently being discussed in the investment committee of CSIL„ which has been asked to recommend the best option which will then be approved by the CSIL board to be included in the plan for DSL.

In the light of the recent events in which CSIL along with the support of over 10% of shareholders of DSL had requisitioned EOGM of DSL on 11th February exercising the right with the agenda of appointing independent auditors and to replace the existing board of DSL with the nominees of CSIL, the board reviewed CSIL stake in DSL which is:

1) Advance against the issuance of shares Rs354 million. Pending the decision of the honorable Lahore High Court, if approved CSIL will be issued 78.66 million shares at Rs4.50/ share. Upon issuance of such shares the revised capital of DSL will be 394 million shares, resulting in 20% holding of CSIL in the diluted capital. For the sake of clarity, CSIL has assigned Rs57 million to Din Corporation (12.6 million shares — 3.2% holding). This assignment has been made against SPA signed between CSIL and Din Corporation for a swap of shares of Crescent Star Foods (Pvt) Ltd currently held by Din Corporation.

2) Interest of Rs.248 million has been charged by CSIL which current DSL management continues to resist acceptance, however, CSIL reserves its right to continue the claim and seek all legal remedies that are available.

The board reviewed the management's strategy to continue the legal remedy and expect the issuance of shares subject to the approval of the court.

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