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Monday, 11 June 2012

STOCK MARKET UPDATE: 12.06.2012

STOCK:


Karachi Stocks Up 42.76 Points:
KARACHI, June 11: At close of trading, the KSE-100 index was at 13601.46, up 42.76 points.
June 11, 2012
5 TOP GAINERS  &  LOOSERS:

Rafhan Maize
Rs 130.18
Unilever Food
Rs (110.00)
UniLever Pak
Rs 39.16
Bata (Pak) Limited
Rs (14.31)
Nestle Pakistan
Rs 20.85
Fazal Textile
Rs (10.76)
Wyeth Pak
Rs 4.96
National Foods
Rs (9.78)
Attock Petroleum
Rs 4.08
Siemens Pakistan
Rs (7.16)

Karachi Stocks recover 43 points in thin trade
KARACHI, June 11: Shares at the Karachi Stock Market gained 42.76 points on Monday to close at 13,601.46 points, which represented a slight recovery from the heavy fall last Friday.
The rumour mongers continued to churn out varying views on the petition filed by a member of the Parliament in the Courts against the Presidential Ordinance that granted amnesty of “no questions to be asked” on the sources of funds to be invested in equities over the next two years. The issue had frightened the investors who went into panic selling on Friday.
Investors also watched the Rupee falling to its all time low of 94.26/34 against the dollar. There were no triggers that could keep stock prices up, which pushed retail investors to the sidelines, resulting in the turnover on Monday at nearly half of the last session.
Mohammad Sohail at Topline Securities observed that the volume at the exchange had dipped to a 20 week low. The foreign outflow reported by the National Clearing Company of Pakistan stood in the huge sum of $69.44 million. Though much of it represented the payment in settlement of sale proceeds of majority shares in Hub Power Company by local groups, the foreign fund managers also decided to wait for stocks to fall further for a better bargain. An analyst thought that the prolonged stagnation and low volume in a falling market did not spell well for the market. The absence of retail investors saw second and third tier stocks almost absent from the active list. Those had been in the fore-front of the previous prolonged bull market. One equity dealer suggested that the market could continue the roller coaster ride until the passage of the Finance Bill, 2012.
Traded volume registered a massive fall from 124.437 million shares on Friday to 60.206 million shares on Monday. The market capitalization also stood down from Rs3,468.388bn to Rs3,471.924bn on Monday, representing a decline of Rs3.536bn.
Of the 131 advancing scrips, Rafhan Maize increased by Rs130.18 to close at Rs3,093.65, followed by UniLever Pak that gained Rs39.16 to close at Rs7,247.66. Among the 129 stocks that finished in the red territory, UniLever Food was the biggest loser of Rs110.00 to close at Rs2,762.50. Bata Pak closed at Rs639.56 after a decrease of Rs14.31.
On the active list, Jah Sidd Co gained 56 paisa to close at Rs14.49 while Nishat Power Ltd went up by 46 paisa to close at Rs14.87. PTCL went from the opening rate of Rs14.38 to close at Rs14.37 after losing one paisa. DGK Cement registered a gain of 42 paisa to close at Rs40.24 while in a similar manner after gaining 9 paisa, Azgard Nine closed at Rs6.06. Nishat Chun closed at Rs15.10 from Rs14.93 after gaining 17 paisa. Adding three paisa, JS Investment meanwhile closed at 7.91. Lotte Pak lost five paisa to close at Rs7.66 while after a gain of 77 paisa Engro Foods closed at Rs64.50. Opening at Rs108.44, Engro Corp lost two paisa and closed at Rs108.42.
ANNOUCEMENTS/COMPANY NEWS:
1) Foreign sponsor plans to quit ICI Pakistan: KARACHI: Three local companies — Lucky Cement, Nishat Mills and Fajr Capital — announced on Monday that they intended to carry out due diligence process to evaluate and assess the viability of a potential acquisition of 76.81 per cent shares in ICI Pakistan Limited.
They stood among the short-listed potential acquirers and have been invited to the due diligence process.
Major shareholder of ICI Pak Ltd is ICI Omicron, B.V, a subsidiary of AkzoNobel N.V, which holds total number of 92 million or 75.81 per cent of the issued shares in ICI. The due diligence process would take place under the Listed Companies (Substantial Acquisitions of Voting Shares and Take-over) Ordinance, 2002 and the Regulations 2008.
Lucky Cement announced on Monday that it intended to acquire 70 million shares or 75.81 per cent of total paid-up capital of target company from its principal overseas shareholder.
Nishat Mills Limited also notified its intention to target ICI Pak, for acquisition of equal number of shares, which would ultimately be held by ICI Omicron B.V, after giving effect to the ongoing company reconstruction recently approved by the Sindh High Court.
The Nishat Group is on the whole represented by various individuals and group companies.
The third contender to the proposed acquisition was identified as Fajr Capital which together with ICORP (private) Ltd intended to seek 87.9 per cent shares of target company, pursuant to an agreement to be negotiated and entered into among the relevant parties.
The acquirers observed that in the event of success, the number/percentage (of shares) may change at the time of public announcement of the offer. Fajr Capital Limted is incorporated under the laws of the Dubai International Financial Centre and based in Dubai, UAE. A total of six entities have been listed as major shareholders in the company, which is chaired by Adib AlZamil. ICORP (Pvt) Ltd on the other hand, is the local company owned by certain employees of ICI Pak.
In ICORP (Pvt) Ltd, seven persons are identified as major shareholders. They are currently employees (including senior management) of ICI Pak Ltd and own 100 per cent of ICORP.
Following public announcement of participating in the employee buyout of ICI Pakistan through ICORP, more employees who desire to participate could become shareholders in ICORP.
If the acquirers proceed to get the target shares, they would make a public announcement of Offer to acquire shares in accordance with the requirements of the Regulations. Earlier this month, ICI Pak Ltd had announced that the High Court of Sindh on May 17 had sanctioned the Scheme of Arrangement for reconstruction of the company, which in accordance with the terms became operative on June 1.
This related to the ICI Pakistan’s decision to spin off the paints business from the company and vest into another company, Akzo Nobel Pakistan Limited, which would be listed on the three stock exchanges in Pakistan. Subsequently to the approval of the transfer of Paints undertaking of ICI to Akzo Nobel Pakistan Ltd, ICI Pak Ltd would re-emerge with reduced capital. Few would have, however, suspected that the foreign sponsor was contemplating divesting its ownership of other businesses as well, and leave.
2) Hub Power Company is sold: KARACHI: The three Dawood group companies: Cyan Limited, Dawood Hercules Corporation and Dawood Hercules Fertiliser, paid off around $65 million as the proceeds of cumulative acquisition of 169.74 million shares in Hub Power Company Limited.
The deal made earlier at the end of March this year was sealed, after the foreign majority shareholder in Hubco — the country’s largest Independent Power Producer (IPP) — stepped out, selling all of its strategic holding to the local conglomerates.
National Power International Holdings B.V, had entered into a `share sale-purchase agreement’ to divest its 17.44 per cent controlling stake in Hubco at a price of Rs31 per share. The off-market transactions on the Karachi Stock Exchange on Monday showed that a total of 190 million shares of Hubco had changed hands that day at Rs31, which at Rs90 to a dollar works out to $65 million. The National Clearing Company of Pakistan reported net foreign equity outflow of $69.4 million on Monday.
The National Power held 201.8 million shares, which were to be acquired by two major parties: The Dawood Group and the Allied Bank Limited. The former has made acquisition through three separate entities: Dawood Hercules Corporation 35.48pc shares; Dawood Hercules Fertiliser (wholly-owned subsidiary of Dawood Hercules Corporation) 102.26 million stock and Cyan (formerly Central Insurance Company) 32.3 million shares.
The other major buyer Allied Bank Limited, which has acquired 31m shares, is an Ibrahim Group company that already holds 44 million or 3.8 per cent of the Hubco stock.
Cyan Limited announced on Monday that ‘all regulatory consents and approvals’ were in place and the company was proceeding for acquisition of shares in Hubco.
It may be recalled that in the autumn of 2011, the other major foreign sponsor in Hubco, Xenel had called quits, divesting its entire shareholding of 140m shares (12.3 per cent) at price of Rs37 per share. That deal had resulted in outflow of $60 million.
At the time of project inception in 1994, the two sponsors cumulatively owned 34.9pc holding or 404m shares: International Power 20.4pc and Xenel 14.5 per cent.

MOHAMMED SALEEM MANSOORI

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