Pages: 3 profit.com.pk

Blue chip stocks provide much neededimpetus to bourse Page 03

Wednesday, 18 January, 2012

kArAchI

GHULAM ABBAS

THe country can easily meetthe expected demands ofaround 2200 MMCFT gasby 2015 through the

“Underground Coal Gasification(UCG) Project” through theinvestment of only over $1 billion.The project, which has successfullystarted producing gas recently, hasproved to be the only solution tobridge the gap between demand andsupply of gas in the country on a shortterm basis by utilising indigenousresources at lower costs.during a visit to the UCG project atTharparker, Sindh recently, Profitobserved that the government fundedpilot project, started under thesupervision of the renowned scientistdr Samar Mubarakmand, wassuccessfully producing gas as it hasalmost completed the first gasifier atThar, which is enriched with thereserves of 175 billion tonnes of coal.

The only Block-5(64

Sqkm) of Thar allocated for thegasification project could meet theenergy demands of the country forover 30 years as it has the reserves of1.4 billion tonnes. The pilot project,initially aimed to generate gas forproducing 100 megawatts, is nowbeing planned to be extended from theapproved 18 to 84 gasifiers. Theneeded $1.2 billion fund for theproposed 84 gasifiers is likely to beapproved by the government as thematter, according to sources, isscheduled to be discussed soon.Talking about the recentdevelopments at the project, drMuhammad Shabbir Managingdirector of UCG project said thatdespite much criticism and hue andcry over the gasification project, theteam led by dr Samar Mubarakmandhas succeeded to produce gas throughthe indigenously designed projectwithout any foreign funding.“as mining needs heavy investmentbesides the technical and processinghindrances in the area, the UCG was abetter alternative to explore the hugereserves of coal”, he said. according tothe Md, a gasifier could easily producethe required gas for at least 10 yearswhile the whole setup could berelocated in the area with less

expenditure, besides the project hasno

environmental implications ascompared to mining.Through the produced gas, thegovernment was going to purchasesome engines of 1.5 MW each to usethe gas for generating power and theproject was expected to be able togenerate at least 100 MW by the mid ofnext year. Besides the immediate andensured supply of gas through theproject, he informed, the powergenerated by the undergroundgasification would be much cheaper asthe electricity through the processwould be available at $16 per megawattas compared to $77/MW and $69/MWproduced through Integrated GasCombined Cycle and Natural GasCombined Cycle respectivelyaccording to Muhammad Shabbir, thedemand of gas in the country wasexpected to be 2200 MMCFT by 2015as compared to the current demands of1500 MMCFT against 5500 MMCFT.To meet the expected demand almost84 gasifier were needed to beestablished at the side as a gasifier wasestimated to produce at least 26.5MMCFT gas. Currently only onegasifier has started producing gas whileanother 17 units are in the pipeline. Heinformed that at least 49 to 50 gasifierswould be established in 1 Sq km of theBlock-5 which was stretched over 64Sq km. One gasifier was being built atthe cost of rs1.2 billion making the

total cost of 84 units rs101

billion or $1.12 billion.almost 150 personnel were currentlyworking at UCG project out of which62 employees were from Sindh and 30to 32 workers belonged to Tharparkar.Talking about the benefits of theproject for the locals, he said thatmaximum job opportunities werebeing given to the locals while theywould also be given preference forsupply of water, gas and electricitythrough the project. In reply to query,he rejected all concerns shown fromvarious corners over the project sayingthat there were no human orenvironmental hazards in the project.To another question, he said, thepresent government was serious aboutthe project as it has provided therequired facilities to UCG. It is worth mentioning here that thefirst test burn at the undergroundcoal gasification project was made indecember 2011 after completing thefirst gasifier and civil works with theavailability of $9.22 million for theproject. The completion of the gasifieralso involved over 36,000 feet ofdrilling and 18,000 feet of steel-casing and other engineering works.On the other hand, the oil importerslobby and others, sources claimed, havealso started their activities to fail thealready succeeded project as the gasproduced after the new developmentscould not only reduce the import of oil

but also produce diesel, car fuel,waxes, Naptha

and others.

ISLAMABAD

AMER SIAL

PakISTaN has assuredafghanistan of resolution of block-ade of afghan containers contain-ing perishable items and fuel

within next ten days, as both countriesagreed at the two day joint economic com-mission meeting to enhance bilateral tradefrom $2.5 billion to $5 billion by 2015.

addressing a joint news conference, Fi-nance Minister abdul Hafeez Shaikh alongwith his afghan counterpart Hazrat OmarZakhiwal said both sides agreed to hold JeCmeetings on regular basis to address variousissues that hamper promotion of bilateraltrade and investment. The meeting of JeCwas held after a gap of three years.

The minister assured that problemsfaced by afghan traders due to blockade ofcontainers would be removed within the next10 days. He said it was noted that there was

huge bilateral trade potential which remainsunutilised and it was decided to enhance bi-lateral trade to $5 billion within next threeyears.

as the afghan side sought assistance inoil and gas exploration, power generation,construction and mining sectors, Pakistanoffered machinery and equipment toafghanistan. The state owned Water andPower development authority (WaPda)will be helping afghanistan to develop hydelpower generation on kabul river for exportin the region. Similarly the national flagshipOil and Gas development Company limited(OGdCl) would help the neighbouringcountry in oil and gas exploration while thetwo state owned gas utilities, SNGPl andSSGC will provide assistance for developingtransmission network.

The minister said both sides agreed toestablish a joint chamber of commerce andindustry to identify areas for promoting bi-lateral trade and investment. It was agreed

to explore possibility of entering into agree-ment for promotion of bilateral trade. It wasalso agreed that both sides would establishdisplay centers at kabul and karachi for pro-motion of bilateral trade.

afghan Finance Minister Hazrat OmarZakhiwal said both the countries have unfor-tunately not been able to utilise the immensebilateral trade potential, even though thereis a political will of the leadership of both thecountries in this regard.

Seeking investment from Pakistan, hesaid investors from all over the world werecoming to afghanistan but Pakistani in-vestors were shy due to some mispercep-tions, that they were not welcomed to thecountry. “afghanistan will welcome Pak-istani investment in exploration, hydelpower, constructing and mineral sectors”.

He said there were many irritants inafghan transit trade through Pakistan and ifthey were not removed they could cause a bigimpact on promoting bilateral trade. He sug-

gested going beyond irritants to promote theaccess of people and trade. He saidafghanistan could be a “land bridge” for con-necting South asia and Central asian whichwill benefit the people of the region.

about irritants he said Pakistan hasstopped transit of NaTO containers whichhas also resulted in blockade of 700 afghancontainers having perishable items and fuelsupplies. He stressed speedy resolution ofthe issue. Similarly he said misunderstand-ing on declaration of goods was causingdelay in the release of transit consignments.

Hafeez Shaikh said issues related totransit trade between the two countriesunder afghanistan Pakistan Transit Tradeagreement would be resolved to opera-tionalise it. He said issue of insurance guar-antees would be discussed to resolve theissue. He said the meeting also reviewedprogress on 29 projects being developed inafghanistan, under Pakistan’s 300 millionassistance. He said both countries agreed to

expedite completion of Torkham Jalalabadcarriageway within one year as already 70per cent construction work was complete.

Pakistan, he said, has askedafghanistan to provide encroachment freeroute to initiate process for establishingChamman- Spinboldak-kandhar railwayline. He said setting up of liaquat ali khanengineering faculty, Nishtar kideny Centerand 2000 scholarships to afghan students,CaSa 1000 and TaPI pipeline were alsodiscussed. Pakistan exports to afghanistanwere $2.3 billion and imports were of $172million in fiscal year 2010-2011.

afghan finance minister also called uponpetroleum minister dr asim Hussain anddiscussed supply of jet fuel to afghanistan.Petroleum minister sought permission forthe state owned oil marketing company, Pak-istan State Oil, to start its operation inafghanistan. afghan delegation welcomedthe offer and assured complete cooperationto the company to start its operations.

Pakistan, Afghanistan agree to enhance bilateral trade to $5 billion by 2015

Coal Gasification to meetcountry’s energy demands

g UCG able to generate 2200MMCFT gas from Thar in a couple of years g Underground gasification project successfully starts generatinggas g First phase of gasifiers to generate 100 MW power by next year g No need to have gas supply from Iran or Central Asia

Ministry circumventscourt orders, imposesLPG surcharge

ISLAMABAD

STAFF REPORT

Federal government has imposed aPetroleum development levy onlocally-produced lPG with effect from

Monday, according to an official notification.The new tax is expected to raise retail prices byat least 10 per cent immediately; and is likelyto be challenged in court. “The government’sdecision to forcibly raise lPG prices, which arealready equated with Saudi arabian exportprices, is a deeply flawed one,” said BelalJabbar, spokesman for lPG association ofPakistan (lPGaP). “This will have an urgentlyadverse effect on everyday consumers and theindustry,” he added. “We are disappointed thatthe government has chosen to disregard boththe public interest as well as the orders of thehonorable courts.” Petroleum developmentlevy on local lPG production was firstimposed last September through lPG Policy2011. That policy, which was made withoutstakeholder inputs and aimed at crowding outthe private sector and establishing a publicsector monopoly, was suspended in its entiretyby the honourable lahore High Court. lPGindustry maintains that the policy was craftedto secure financial viability of Progas lPGimport facility, which was controversiallypurchased last year by Sui Southern GasCompany limited. Ministry of Petroleum andNatural resources has circumvented thecourt’s orders and the suspension of lPG Policy2011 through an amendment to the petroleumproducts (Petroleum levy) Ordinance, 1961. Ithas imposed a surcharge of rs11,486 per tonneon all locally-produced lPG with effect fromJanuary 16. The government-dictated priceincrease is expected to take retail prices toabout rs155 per kg from the current average ofrs140 per kg. “With the imposition of thesurcharge, lPG prices in Pakistan are now atan all-time high,” said Jabbar. “This isunprecedented and gives the lie to thegovernment’s own claims of desiring tofacilitate lower-income households which relyon lPG for heating and cooking purposes.”Pakistan’s 11 lPG producers are expected topass this additional cost on to end-consumers.The government of Pakistan is the largestproducer of lPG in the country by virtue of itsshareholdings in, among others, ParCO,OGdCl, and PPl. Pakistan is currently facinga natural gas deficit of over 1,000mmscfd. Theenergy crisis has led to unemployment andunrest across the country. after imposition ofPetroleum development levy, lPG, which wasbeing used as a replacement fuel for naturalgas, has now become the most expensive fuelin Pakistan in terms of calorific value per rupee.

PRO 18-01-2012_Layout 1 1/18/2012 12:45 AM Page 1

news02Wednesday, 18 January, 2012

kArAchI

ISMAIL DILAWAR

WHereaS the country’svolumes-starvedcapital market is underimmense pressure on

the external and domestic fronts,many of the members of karachiStock exchange (kSe) are tending toshut their loss-making stock marketbusiness. The market participants,particularly the 200 card holders,are losing interest in the capitalmarket, where, due to low volumes,the profits are less attractive. Thissituation has forced many of theactive kSe members into sellingtheir membership cards even at

throwaway prices.M/s Hum Securities is one such cardholder which, the market sourcessaid, has finalised a deal with anunknown buyer to sell itsmembership card at rs40 million.“The deal has been made to sell themembership card at four crorerupees,” said a source privy to thedeal.This price reflects a tremendousdevaluation of the assets related tothe stock market as the same cardused to be priced at rs140 millionsome three years back in 2008.“This rate shows that themembership cards have shed itsprice value by over 70 per cent orrs100 million over the past few

years,” the source said. abba karim,the source recalled, was the cardholder who had sold his membershipcard at rs140 million in 2008.Commenting on the deal, a marketobserver said the volumes, whichwere staggering at record low of 30million shares, had left marketparticipants with no option but toquit. He said while the investorswere keeping aloof from the equitymarket due to an ill-thought-outregulatory framework, thecontroversial taxes like the CapitalGains Tax (CGT) had added fuel tothe fire.Securities and exchangeCommission of Pakistan has finallyrealised that CGT was not in the

interest of the country’s ailingeconomy.“Maintaining status quo on the CGTis not in the interest of the economyas it has adversely impacted taxrevenue collection as well as tradingvolumes at capital markets,” SeCPchairman Muhammad ali observedin a notice sent to kSe last Friday.The levy, the regulator conceded,had adversely affected investors’sentiments, capital formation andoverall functions of the capitalmarket. Uncertainties on thepolitical front are equallyattributable as causes of erodingvolumes at the stock markets.“Stock market investors will keenlyfollow developments on the political

front,” said Muhammad Sohail, astock market analyst and chiefexecutive of Topline Securities. Theanalyst said market would rally ifindependent caretaker governmentwas appointed with consensus tosupervise the elections in 2012.a market participant claimed thatthere were many among the 160active kSe members who werebracing themselves for selling outtheir membership cards, but someregulatory requirements werehindering their way. as per SeCPrules, he said a member wanting tosell his/her card would need to getSeCP’s clearance apropos his lastthree years’ income tax statementsbesides that of his clients.

KSE members selling out membership cards at throwaway priceg Hum Securities sold out card at Rs40 million recently g Membership card used to be priced at Rs140 million in 2008

LAhOrE

STAFF REPORT

rISING risk perception aboutinvesting into Pakistan ishitting hard the Foreign directInvestment (FdI) that fell

sharply in recent months and needs to betackled through a comprehensive policyapproach by involving the chambers ofcommerce in the country. In a statementissued here Tuesday, lCCI PresidentIrfan Qaiser Sheikh said severest everenergy shortfall, bad law and ordersituation, institutional fragility andpolitical instability were major factorskeeping the foreign investors away. lCCIPresident feared that the fall in foreigndirect investment was likely to adverselyaffect the country’s economic growth;therefore government should adoptremedial measures to reverse this trendand to attract foreign investment.at the same time, lCCI President said,slow government response to deal withaggravating energy crisis was alsospoiling not only the local investmentscenario but also sending a very negativesignal to potential foreign investors. IrfanQaiser Sheikh said a special committeecomprising members of the parliament,presidents of chambers of commerce andindustry and representatives ofassociation should be formed to identifysolutions to attract foreign investmentthat is a prerequisite to economic growth.lCCI President said the proposedcommittee should also be tasked to lookinto existing policy framework and ifthere is a need to redesign new policies itshould immediately initiate work on

them. Irfan Qaiser Sheikh said all thedeveloped countries accord specialimportance to economic issues andchallenges. But in Pakistan the situationis the other way round and the economyis on the bottom of government to-do list.He said key issues including powershortage, poor infrastructure, law andorder situation and other vital factors,should be addressed on priority basis toimprove the bleak foreign investmentcondition to put the country on track ofeconomic growth and development.“at the same time the government shouldensure that all institutions remainimmune to any sort of undue interferenceas this will help improve quality ofgovernance without which foreigninvestment can not be attracted.” lCCIPresident said that a number of sectors inPakistan including infrastructuredevelopment, coal, energy, agriculture,livestock, textiles and pharmaceuticaloffer lucrative investment opportunitiesto foreign investors but unfortunatelydue to absence of a proper marketingstrategy these opportunities areunattended even today.It may be mentioned here that Pakistan’sinvestment rate was only 13.4 per cent atend of last fiscal year, which was lowestsince FY74. The low saving rate, coupledwith wary foreign investors led to recordlow investment rate in the country. StateBank had already reported in its annualreport that Pakistan had fared poorlywhen compared to its neighbours inSouth asia, because of domestic andglobal factors. However, SBP said itbelieved that the domestic issues aremore decisive and chronic.

kArAchI

STAFF REPORT

THe volume erosion in thepreceding year and expectedcontinuation in the current yearmay impact the price discovery.

On valuation terms, it is foreseen that thebenchmark is capable of 18.5 per centgrowth to reach 13,443 points as themajority of sectors are trading well belowtheir intrinsic fundamental values. Bilalasif at HMFS said that with all factorsconsidered, our top picks for 2012 arePPl, POl and HUBCO from the energychain, FaTIMa from the fertiliser sector,lUCk from the cement sector and MCBfrom the banking sector. albeit majorityof the stocks are trading at a significantdiscount to our valuation, we prefer theabovementioned stocks on the basis ofprevalent risk and return scenario, he

added. He firmly believes that managingthe Current account would be a dauntingtask as the Current account deficit for the5MFY12 has already surpassed $2.1billion which is approximately 0.92 percent of the GdP. Oil bill during 5MFY12reached the $6.29 billion mark andassuming the average oil prices remain atthe same level our oil bill may easilyreach the $15 billion mark which wouldfurther enlarge the Current accountdeficit. ‘If we consider the actual budgetdeficit estimate of rs851 billion turningout to be accurate and include the currentconversion of power sector circular debtamounting to rs391 billion, the budgetdeficit may be around 6.31 per cent(assuming the GdP growth of 3.7 percent). Non materialisation ofprivatisation proceeds and excessivesubsidies to power sector may furthercomplicate the situation,’ he added.

kArAchI

STAFF REPORT

POlITICal developments, likeSupreme Court’s recent con-tempt of court order to theprime minister, are making life

difficult for fund managers investing inPakistan stocks, observed analysts. Thiscontempt of court has been given on fail-ure to reopen cases against PresidentZardari and others, previously set asideunder the infamous National reconcilia-tion Ordinance (NrO).

“These developments are addingmore uncertainties in the local politicalscene and making life difficult for fundmanagers investing in Pakistani stocks,”said Mohammed Sohail, chief executiveofficer of Topline Securities.

However, the analyst said, he be-lieved that it looked akin to the last fewepisodes of a high profile drama thatwould eventually lead into early electionsomewhere in second half of calendaryear 2012. and once the path to earlyelection is clear the local equities that aretrading at forward Pe of 5.7x and divi-dend yield of nine per cent could rally,we believe. However, it will take sometime before the drama ends and clarityoccurs on the timing of the much-

awaited general elections.PPP government’s five year term will

end in 1Q2013. Pakistan’s general elec-tions are not scheduled to take place untilearly 2013 as per the normal routine.

However, major rallies by oppositionparty PMl-N and the former cricketer atthe helm of PTI in recent days, ‘Mem-ogate Scandal’, NrO hearing coupledwith their subsequent events signal signsof early election in 2012.

all leading newspapers and TV chan-nels are also hinting at the possibility ofelections in 2012. In fact in one of the in-terviews, President Zardari has alsohinted at early election. However, thereare questions regarding the independentelection commission and an acceptablecaretaker prime minister to both the rul-ing and opposition parties.

With Senate elections due on March02, the present government would try tobuy time as the present electoral compo-sition would allow the government tobecome the largest party in the upperhouse. In this regard, PM’s appearancein the court could be used as a delayingtactic with either a) PM accepting hismistake and making commitment toopen the cases or b) refusing to write toSwiss authorities under the ambit ofpresidential immunity.

Whereas probability of the formerbeing the case is low and will automati-cally buy time for the government, thelater could result in the PM disqualifica-tion, resulting in change of the primeminister. even in this scenario govern-ment would get time to secure its positionin the upper house. Beyond the point, webelieve there would be overall consensusof early elections by both the governmentas well as the opposition.

Stock market investors will keenlyfollow developments on the politicalfront. Given early election or otherwise,we expect political noise to remain highin the coming few weeks and the tug ofwar between political players would cre-ate a wave of uneasiness at local bourses.

The market will rally if independentcaretaker government is appointed withconsensus to supervise the election in2012. Investor will cheer any announce-ment of early change in the governmentconsidering that last 4-year of PPP gov-ernment brought average GdP growth of2.9 per cent only while average yearly in-flation of 14.6 per cent in the said period.

looking at the past trend, stocks haverallied by 9 per cent and 12 per cent onan average 3-month and 1-month beforethe elections. and this time also we expectshare value to react positively.

kArAchI

WAQAR HAMZA

THe stock prices of both lUCkand dGkC had unperformedthe market one week and onemonth following the Competi-

tion Commission of Pakistan (CCP) raidon the offices of all Pakistan CementManufacturer association (aPCMa) onapril 24, 2008 and later convicted theindustry and imposed a fine of rs6.3 bil-lion on the industry on august 27, 2009.This time CCP once again raided aPCMaand kohat Cement on suspected carteli-sation within the sector yesterday. Sinceprices are the biggest driver of earningsfor the sector any major downward ad-justment in prices poses a risk to theearnings expectations for FY12 for bothlUCk and dGkC. So, the historicaltrend of cement prices CCP’s actionsshows that the cement sector’s profitabil-ity is highly sensitive to cement prices.Interestingly, despite the raid on april24, 2008 cement prices had improved ona QoQ basis by 16 per cent in 4QFY08.Further rise was seen in average reten-tion cement prices by 33-39 per cent ona QoQ basis during 1QFY09, thus indi-cating that the threat of a vigilant investi-

gation had not disturbed the pricingpower within the sector. Conversely, adifferent trend was witnessed after im-position of a fine on the industry in au-gust 2009. average retention pricesdipped in September 2009 by 10 percent and than by four per cent in Octo-ber 2009. Considering that cementprices are up by approximately 8-9 per

cent QoQ in 2QFY12, while coal hasdipped by nine per cent QoQ in thesame period cement manufacturers mayopt for a less confrontational strategy.‘as a result, minor downward adjust-ments cannot be ruled out. However, amajor plunge in cement prices will affectour earnings forecast for both lUCk anddGkC,’ said Furqan ayub at JS.

Perception hurts foreigninvestment in country

Benchmark capable of18.5 per cent growth

Political uncertainty multipliesequity investors woes

LUCK, DGKC underperform

PRO 18-01-2012_Layout 1 1/18/2012 12:45 AM Page 2

news

Wednesday, 18 January, 2012

03

CORPORATE CORNERAirBerlin and Etihad Airways inauguratedirect Berlin-Abu Dhabi servicesLAhore: etihad airways, the national airline of theUnited arab emirates, in conjunction with airBerlin,europe’s sixth biggest carrier, has begun direct servicesfrom Berlin to abu dhabi with the first flight to thecapital of the United arab emirates (Uae) arriving thismorning. The inaugural flight was greeted by a traditionalwater canon salute. Using an airbus a330-200 aircraft,airBerlin will operate four flights a week between the twocapital cities. With daily flights to abu dhabi fromkarachi, lahore and Islamabad, Pakistani travellers canvisit this magnificent location with ease. PRESS RELEASE

Ufone gives away tractor to thewinner of Kissan Package lucky drawISLAMABAD: keeping the competitive spirit alive,Ufone recently gave away a tractor to a kissan packagecustomer. at the initiation of the package a lucky drawscheme had been designed specifically to support thebusiness and daily life of the farmers, by virtue of thisscheme Mr. Mazhar Hussain from Vehari became theproud owner of a tractor. In the recent past Ufone hasshown a keen focus on the various segments in the societyand the kissan package targets one of the largest sectorsin the country. agriculture is the most important sector ofthe Pakistani economy and society and has a number ofneeds and requirements which have been catered to withthis perfectly designed package. PRESS RELEASE

State Life Insurance selects UnitedBank Limited to sell Bancassurance KArAchI: United Bank limited (UBl) became the firstbank in Pakistan to be signed up by State life InsuranceCorporation (SlIC) to sell their insurance products underBancassurance. SlIC is the leading State Owned InsuranceCorporation of Pakistan with the highest market share at70 per cent, in its industry, as well as the largest network ofoutlets. UBl has been selected by SlIC due to the bank’srecent success in the selling of various Bancassuranceproducts, enjoying a high persistency ratio and a lowcancellation ratio. UBl’s large branch network of over1200 branches as well as its technological infrastructurealso factored in as the basis for its final selection. GBaServices, SlIC’s exclusive Third Party administrators(TPa) for Bancassurance originated this tie up and willprovide technical, marketing/advertising supportincluding state of the art online POS System for instantcoverage to UBl customers, new product development,and staff training. PRESS RELEASE

Wateen launches freedom boothsLAhore: Wateen Telecom, Pakistan’s leading convergedcommunications company, is proud to announce thelaunch of its new Freedom Booths, a revolutionarycommunications medium. The Freedom Booths – the firstof their kind to be launched anywhere in the world – reflectWateen’s capabilities as a leader in convergedcommunication services and exemplify the company’sdata, voice and content creation services. The applicationsfor the Freedom Booths are limitless. This cutting-edgemedium of communications aims to maximise theapplication potential of the internet, while helping connectpeople across the country. PRESS RELEASE

Visa partners with HarrodsLAhore: Visa, one of the world’s leading paymentsolution providers, has revealed an exciting newpartnership with Harrods, offering Visa InfiniteCardholders the unique opportunity to obtain theprestigious knightsbridge store’s exclusive Black rewardsCard. Harrods Black Card offers customers the highest levelof benefits from the store’s rewards programme. Theseinclude the opportunity to take advantage of Harrods’exclusive personal shopping service, special discount days,complimentary parking and much more. Usually availableto customers spending at least GBP 10,000 in Harrodsstores annually, Visa is delighted to announce that, as ofthis month, the minimum amount has been waived for allVisa Infinite Cardholders across the region. PRESS RELEASE

Blue chip stocks providemuch needed impetus to bourse

K araCHI: Bullsthronged karachi Stockexchange on Tuesday

on the back of investors’ in-terest mainly in fertiliser,banking and oil sector stocks.The kSe-100 Index surged by192.51 points to close at11,305.16 level. despite aworsening political climateinvestors remained optimistic

and chose to opt for blue chipstocks. Investor activity in-creased, on the back of posi-tive news from the fertiliser,banking and oil sectors.

Trading activity also im-proved as daily volumes in-creased to 53.112 millionshares as compared to 26.681million shares traded onMonday. Compared from the

previous day, the increase indaily volumes is certainly agood omen for the investors.

Of total 321 active stocks,141 closed in the positive and90 in the negative while thevalue of 90 stocks remainedunchanged. engro Corp. wasthe volume leader with 5.977million shares and gainedrs4.56 to close at rs100.45.

KARAcHI: The British Deputy High commissioner Franciscampbell, hosted a reception for Lord Green, Minister ofstate for Trade and Investment, and Baroness Warsi,cabinet Minister & chairperson of the conservativeParty of UK at Acton House. Photo shows HussainDawood, chairman Dawood Group with host and otherprominent guests. PRESS RELEASE

Solve Agricultural & DairyInstitute conducts training

LAhOrE

STAFF REPORT

S OlVe agri and dairy Insti-tute™ (SadI) has con-ducted special trainingprogramme on “Commer-cial dairy Farming” for Pio-

neer Pakistan Seed ltd. The threeday course was attended by Pioneer

Pakistan Seed’s field staff in-cluding district Sales agronomists(dSa), Customer Service

agronomist (CSa) and Sales Of-ficers (SO). The objective of thetraining was to impart practical

knowledge about dairy farmingon commercial scale in order tomake them effective in guiding andsupporting dairy farmers in theirrespective areas. dairy farm feasi-bility, site and animal selection,Housing and sheds construction,basics of animal nutrition, nutri-tional requirements and ration bal-ancing, Nutritional deficiencies,feeding management, Heat stressmanagement, standard operatingprocedures, economics of dairyfarming were the major areas fo-cused during the training. expertswith hands-on and practical knowl-edge were invited to conduct train-

ing sessions. Participants were pro-vided with the opportunity to learnand clarify their concepts aboutmodern practices required to beadopted in commercial dairy farm-ing. a study tour was also arrangedto Zacky dairies to give an insighton commercial dairy farms beingrun through an integrated farmingincluding dairy farming, vegetableproduction through tunnel farming,fisheries, poultry and organic agri-culture through bio-fertilisers andenergy production through bio-gas.Participants took special interest inlearning farm practices includinghousing, feeding, milking opera-tions, cow handling, bio-gas pro-duction, etc.

The training was concluded withthe certificate distribution ceremonyheld on Saturday 31st of december2011 at Solve agri dairy Institute™.Mr Hafiz Wasi Muhammad khan(Head of Farms & agri division,SaPPl), dr Waseem Shaukat (In-charge Solve agri & dairy Insti-tute™), dr Tariq Javed (NationalSales Manager, SaPPl), dr asif aliShah (Country Manager, PioneerPakistan Seed ltd) and Mr GhulamMustafa (Market development Man-ager, Pioneer Pakistan Seed ltd)

were present at this occasion.Speaking on the occasion dr

asif ali Shah expressed his grati-tude to Solve agri and dairy Insti-tute™ on conducting such animpressive training programme ex-clusively for Pioneer’s staff that pro-vided an opportunity to interactwith experienced trainers, which isconducive to the learning environ-ment. He urged training partici-pants to implement the newlyacquired knowledge in the field totransform the subsistence dairyfarming towards commercial andprofitable farming. He said that Pi-oneer Pakistan Seed, being the im-portant stakeholder in this sector,realises the critical role it has toplay and hence is very much focusedon having right capacity in its staff.He assured that Pioneer PakistanSeed will continue capacity buildingmeasures for its staff in future.

Hafiz Wasi Muhammad khanaddressing at this occasion, cher-ished the participants on their high-est thirst to learn new aspects ofmodern dairy farming. He said thatit has been a great pleasure to seethat Solve agri dairy Institute™ isoffering customised training pro-grammes that fit best to serve the

needs of the respective organisa-tions. He said Pioneer PakistanSeed has got a pivotal role to play inuplifting the dairy sector in Pak-istan and SadI is always ready toput in all the efforts required tobuild capacity of the field staff.

dr Waseem Shaukat (In chargeSolve agri dairy Institute™) in hisconcluding remarks said dairy sec-tor is at an important crossroadsand there is a great need to inter-vene through modern knowledgeand commercial aspects of dairyfarming. He lauded Pioneer Pak-istan Seed for considering theirstaff’s capacity building, as an effec-tive tool for better customer serv-ices, and anticipated that thetraining participants will be able tobenefit the farming communitythrough the knowledge and con-cepts they have gained during thetraining programme about com-mercial and profitable farming. Heurged that such capacity buildinginitiatives should continue in futurein order to develop the sector onsustainable basis.

later dr asif ali Shah, HafizWasi Muhammad khan and drTariq Javed distributed certificatesamong the training participants.

KAPCO outperformsKSE100 index by 11 pc

kArAchI

STAFF REPORT

kOT addu Power Companylimited (kaPCO) hasoutperformed the benchmark

kSe100 index by 11 per cent since thestart of FY12 due to the attractivedividend yield offered by the scrip. Thecompany is also expected to postearnings of rs1.68 per share in 2QFY12compared to earnings of rs1.36 pershare in 1QFY12. Under the PowerPurchase agreement (PPa), kaPCO’sreturns are hedged against rupeedevaluation. Since the start of FY12,Pkr has depreciated by 4.8 per cent to90.5(FY12Td average: 87.54) whereasin 2QFY12 alone, it has lost its value by2.83 per cent to 89.95. We believe thatthe rupee is expected to remain underpressure against the US dollar due tostart of IMF loan repayment from Feb-12, widening of current account deficitand depleting foreign exchangereserves, said Usman Saeed at aHl.due to gas shortage in last couple ofquarters, kaPCO’s plant has mainlyoperated on furnace oil, which has ledto higher repair and maintenance cost.In 1QFY12, company’s three gasturbines went through major overhauling, resulting in overall repair andmaintenance cost to rise by 190 percent YoY. Since FY08, this cost hasincreased by 2.98 times to rs1.85billion in FY10; however it contractedby 35% per cent to rs1.2 billion inFY11. ‘We believe that the recurringcapex will decline going forward as thecompany has already incurred a capexof rs1.04 billion for FO basedoperations,’ he added. In June 2011,the company entered into a $14 millioncontract with General electronic (Ge)for upgrading four of its gas turbines.The upgradation process of turbinewas scheduled to be completed in2QFY12 after which the overall plantnet combined-cycle efficiency willincrease by 0.44 per cent. This willenhance the output of the plant by12MW. However gas availability issuehas forced the company to operate onfurnace oil, which results in highermaintenance cost hence hurtingcompany’s profitability.

EXPORT TARGET UNLIKELY TO BE MET THIS FISCALISLAMABAD: Pakistan is unlikely to meet its projected export target as the Tradedevelopment authority of Pakistan (TdaP) has assessed a decline of 6 per cent in exports thatare estimated to remain below $24 billion during the current fiscal year as compared to $25billion export proceeds last fiscal year. Talking to reporters after the National assemblystanding committee on textiles, Chairman Trade development authority of Pakistan (TdaP)Tariq Iqbal Puri, said that worst financial crisis in the european Union and economic slowdownin United States will have negative impact on the country’s exports. He said the energy crisiswas also resulting in low productivity that were having a negative impact on exports. Sayingthat India and China were also faced with 30 to 40 per cent decline in their exports, theestimated 6 per cent decline in Pakistan’s exports was not bad, he said adding that the share oftextile decreased from 67 per cent to 55 per cent in total exports. He said the export of non-traditional items has helped Pakistan to diversify its exports base. earlier the committee wasinformed that TdaP has engaged all stakeholders of textile industry to finalise analysis toprepare a list of textile items that would be positively or negatively impacted under theproposed trade liberalisation with India. Chairman TdaP said all those textile items whichcould be affected by trade liberalization would be placed in the negative list for the protection ofthe sectors which would be unable to compete with Indian competitors. He was of the view thattrade liberalisation with India would help enhance bilateral trade volume from existing $3.5billion to over $6 billion. Cotton, yarn and fabrics exports from India is duty free and uponliberalization of bilateral trade Pakistani industry is set to make it market in value addedproducts in India. The committee was informed WTO Committee on Trade in Goods (CTG) isexpected to meet in February to examine Pakistan’s eU package. at present import tariff in eUon Pakistani exports is 9.6 percent due to general GSP against the normal 12.5 percent importduty. In case eU concessional package gets approval from WTO, Pakistan will get an edge in themarket where it is already holding a good share in eU market. AMER SIAL

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