STOCK MARKET UPDATE:23.01.2013

STOCKS

Karachi Stocks Up 247.79 Points:
KARACHI, Jan 22: At the close of trading, the KSE-100 index was at 16888.60, up 247.79 points.

 (Today Market is 23.03 Up@ 11.00 am)

January 22, 2013

Bull-run on, index adds 250 points

KARACHI, Jan 22: Stocks continued its bullish run on Tuesday in healthy turnover with National Bank of Pakistan in the limelight as investors expected good payouts and dividends and strong corporate profits December end quarter, dealers said.

“The KSE 100-index rose by 1.5 per cent, or 250 points, on robust value buying in the frontline stocks that took the short-sellers by surprise.
The renewed buying that turned wild in post midday session was yet again led by banking, fertiliser and E&P stocks,” said Hasnain Asghar Ali of Escorts Capital Ltd.
While cement front-liners, he added, duly caught the sentiment sighting aggressive activity the day traders duly joined the bandwagon as depicted by decent rise in value and volume, the positive momentum continued uninterrupted through out the session, on funds inflow both from local and off-shore circuits.
The KSE 100-share index ended 1.52 per cent, or 253.28 points, higher at 16,894.09 points. It traded in a broad range as it made an intra-day high and low at 16,909.05 and 16,640.81, respectively.
Turnover increased to 184.13 million shares, compared with 128.25m shares traded on Monday and trading value rose by 2.57 billion to Rs3.73 billion from Rs3.73bn in the previous trading session. Market capitalisation stood at Rs4.21 trillion, higher than Monday’s Rs4.15tr.
“Reduction in political temperature coupled with likely announcements of December results compelled investors to buy quality stocks. National Bank closed at upper limit thanks to institutional buying as investors believe that the bank will again pay a handsome dividend. FFC also improved in expectation of healthy payout in tomorrow’s meeting,” said Samar Iqbal, a dealer at Topline Securities Ltd.
Investors also accumulated energy stocks and that helped the index maintain its positive momentum. Heavyweights such as Oil and Gas Development Co Ltd, Pakistan Oilfields and Pakistan Petroleum Ltd all made significant gains. OGDC rose Rs2.08 to Rs188.96, POL ended Rs11.27 higher at Rs451.91 and PPL increased by Rs3.26 to Rs178.95.
Foreign investors also continued their fresh buying on Tuesday as they bought shares worth a net $1.24 million after buying a net $872,230 on Monday, bringing the total for this month at $6.08m.
Mutual funds were the major buyers with equity worth $6.08m.
The biggest gainer was Nestle Pakistan which ended Rs95 higher at Rs4,600, followed by Bata Pakistan Ltd which closed Rs35 higher at Rs1,285. Unilever Food witnessed the biggest loss as it shed Rs200 to Rs3,800 followed by Island Textile, which ended Rs50 lower at Rs950.
The KSE-30 index ended 1.53pc, or 208.26 points, higher at 13,788.61.
Out of the 350 companies traded, the value of 238 increased, 85 decreased while 27 remained unchanged.
The second and third tier companies dominated the 10 most active traded stocks but National Bank hit its upper circuit, Fauji Cement topped the list as it ended 9 paisa higher at Rs7.39 on turnover of 14.24 million shares, Jahangir Siddiqui Co Ltd rose 39 paisa to Rs15.69 on 12.06m shares and Maple Leaf Cement gained 30 paisa to Rs16.22 on 11.94m shares.
Pakistan Telecommunications Co Ltd increased by 61 paisa to Rs16.86 on 9.85m shares, National Bank of Pakistan gained Rs2.44 to Rs51.26 on 9.66m shares and TRG Pakistan ended 27 paisa higher at Rs7.20.
DG Khan Cement rose Rs1.54 to Rs53.80 on 8.41m shares, JS Growth Fund gained marginally by 6 paisa to Rs10.05 on 5.63m shares and Byco Petroleum ended 4 paisa higher at Rs13.94 on 5.51m shares. KESC gained 29 paisa to Rs5.72 on 4.4m shares.
KSE 100-share index ends three-week high: KARACHI: The Karachi Stock Exchange's (KSE) benchmark 100-share index ended 1.52 percent, or 253.28 points, higher at 16,894.09.
The stock market closed at a three-week high on Tuesday, driven by optimism over upcoming company results, traders said.
"Aggressive institutional buying helped equities to gain 1.5 percent with improving volumes," said a stock.
"(The) Reduction in political temperature coupled with likely announcements of December results compelled investors to buy quality stocks."
Fauji Fertilizer was up 1.72 percent to 120.65 rupees per share, while Fauji Cement rose 1.37 percent to 7.40 rupees. Another strong performer, National Bank, climbed 5 percent to 51.26 rupees per share.
In the currency market, the rupee ended weaker at 97.70/97.74 against the dollar, compared to Monday's close of 97.65/97.70.
Overnight rates in the money market ended at 8.50 percent compared to Monday's close of 8.75 percent. (REUTERS)

Company News:

IGI to acquire American Life: KARACHI, Jan 22: IGI Insurance Limited (IGI) and American Life Insurance Company (Alico) entered into a share purchase agreement on Monday, by virtue of which IGI will acquire the entire sponsors-institutional holding in Alico.
The companies had first declared their intention of purchase-sale on September 25, 2012. It was subject to the successful completion of due diligence.
Separate announcement by both listed companies on Tuesday stated that IGI (a general insurance company listed on the KSE) would acquire ‘‘the entire’’ shareholding in Alico, which stands at 41 million shares of Rs10 each. The acquisition would form 81.97 per cent of the total issued, subscribed and paidup capital of the company.
The Tuesday’s announcement was made in compliance with Clause (xx) of the Listing Regulation No 35 under the Code of Corporate Governance.
The successful consummation of the Transaction was also subject to regulatory approvals and completion of the requirements pursuant to the Takeover Ordinance.
In pursuance to the Listed Companies (Substantial Acquisition of Voting Shares and Takeovers) Ordinance, 2002, IGI would have to acquire through tender offer a specified number of shares from the public.
The announcement by IGI disclosed the Alico take-over transaction to take place at Rs20 per share.
As the acquisition of majority equity was to be conducted at nearly Rs14.75 lower than the market price of the Alico stock, the share in the company at the KSE, plunged by Rs1.73 to hit the ‘lower lock’, representing the maximum permitted 5 per cent of the opening value and close at Rs33.02 on trading in just 1000 shares.
Earlier, several other players including Adamjee Life Assurance, EFU Life, Nishat Group and Packages Group were thought to have expressed varying degrees of interest in buying out American Life Pakistan the subsidiary of Metropolitan Life Insurance Company (Metlife) quoted on the KSE as “American Life Insurance”.
The company on Tuesday did not specify the reason for its sale to IGI.
Looking back on the international scene, it was on Nov 1, 2010 that Met Life acquired the international leader in life-insurance business, American Life Insurance Company (Alico), from American International Group (AIG), after paying an approximately $7.2 billion in cash and $9.0 billion in MetLife equity and other securities.
As regards Alico Pakistan, In Mar 2012, the company had made an interesting announcement of having paid the largest ever life insurance industry’s death claim in Pakistan. The claim of Rs48 million covered Life Time Income with guaranteed payments for 20 years.

MOHAMMED SALEEM MANSOORI