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16-17 Business Pages (11-06-2013)_Layout 1 6/11/2013 5:33 AM Page 1

take the place of those which fail. — Napoleon Hill 01

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BUSINESS Tuesday, 11 June, 2013

brokers see nature at work as kSe awaits budget with caution

KARACHI

not meet a certain threshold for cash payout have also been forwarded. It is proposed by KSE to extend tax rebate of 15 percent on corporate tax rate on new listings from existing one year to five years. KSE is also said to have proposed that the 10 percent tax on dividends be withdrawn as it was double taxation. “KSE’s proposals regarding reduction in corporate tax rate, making cash payout mandatory and others are not likely to be accepted,” believe Topline analysts. Further, they feel that 10 percent tax on dividends would be maintained. If the proposed 35 percent taxation on inter-corporate dividend income imposed, which the analysts say was not likely, it would negatively impact major corporate entities They said the bourse’s movement would depend on the revival of economic activities that have been hampered for quite sometimes. Also, they warned the proposed five percent WHT on the purchase of local cars would adversely affect the auto sector. “For others we expect the sector to be neutral,” said the Topline analysts. Abdul Azeem of InvestCap Research sees the democratic process as having shaped the new political government that, he believes, made foreign and local investors stay bullish and keep investing at the KSE. This, Azeem said, resulted in a significant improvement in the Price to Earning (PE) multiple for the 100 index companies. “The market continues to trade at a deep discount on its key multiples, at 35 percent on PE and 56 percent on DY, to regional peers,” said he. Such deep discount, he said, could be attributed to high currency, political and economic risk-associated premiums required by investors.

ISMAIL DILAWAR

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HE risk-averse investors at the country’s largest bourse, Karachi Stocks Exchange (KSE), are playing with extreme caution as what stocks brokers believe the newly-elected “pro-business” PML-N led government is poised to unveil the new fiscal plan for 2013-2014. Monday saw the benchmark KSE 100share index shedding 208.22 points to close at 22,150.74 points compared to 22,358.96 points of Friday, last trading day of the week. Negatives dominated the bourse with the volume, value and market capital of the traded shares witnessing a downward trend. On first trading session of the week, the turnover contracted to 277 million shares from Friday’s 340 million. The scrips traded lost value that, accumulatively, dropped to Rs 8.039 billion from Rs 10.6 billion of the previous session. The total capital of the companies listed at the KSE also declined, though slightly, to Rs 5.339 trillion from Rs 5.390 trillion. Of the 387 total scrips traded, only 116 could end up in gain while 249 lost and 22 saw the status quo. “(The) stocks closed bearish amid institutional profit taking in stocks across the board,” said Ashen Mehanti, senior equity analyst and a director at Arif Habib Securities. The analyst cited limited foreign interest, volatile global commodities and economic uncertainty as major attributable factors for Monday’s dip. This coupled with the investors’ “security concerns” in this financial capital, Mehanti said. “The trade remained mainly in second

Dollar gains in Asia after upbeat US jobs data TOKYO: The dollar strengthened in Asian trade Monday thanks to a better-than-expected US jobs report, as traders turn their focus to an upcoming policy meeting at the Bank of Japan. In Tokyo morning trade, the dollar was quoted at 98.05 yen, up from 97.56 yen in New York late Friday. The euro fetched $1.3215 and 129.44 yen, against $1.3218 and 128.95 yen. A rally in the greenback, which at one point sunk below 96 yen last week, comes after the Labor Department said Friday that 175,000 jobs were generated in May. While the figures were better than forecasts they were still low enough to prevent the Federal Reserve from reeling back its huge monetary easing programme, which in turn boosted buying sentiment. APP

Oil prices up in Asia after upbeat US jobs data SINGAPORE: Oil prices rose in Asian trade Monday as moderate growth in new jobs in the United States raised hopes about a pick-up in demand in the world’s biggest crude consumer, analysts said. New York’s main contract, West Texas Intermediate for delivery in July, gained 12 cents to $96.15 a barrel and Brent North Sea crude for July added 10 cents to $104.66 in morning trade. “At this moment, the crude market is driven by the positive sentiment about job creation in the United States, which points towards a growing economy,” Desmond Chua, market analyst at CMC Markets in Singapore, said. US Labor Department figures released Friday showed 175,000 jobs were generated in May, despite worries that huge government spending cuts would lead to a slowdown in hiring. The numbers for May were a firm gain from April’s 149,000 rise, though still below the 193,000-a-month January-April average. The jobs data, which came after several lacklustre US economic reports last week, also boosted hopes the Fed will hold off any moves to rein in its monetary easing programme any time soon. APP

and third tier stocks as (the) investor remained cautious ahead of (the) federal budget announcements due next week,” the analyst said. With Bankislami Pakistan appearing as volume leader with 24.7 million of its shares traded, PIAC (A), Bank of Punjab, TRG Pakistan, Fauji Cement, Bank of Punjab, SNGPL, PTCL, Jahangir Siddiqui Company and Pace (Pak) Limited were the top 10 well performing scrips. Senior brokers like Aqeel Karim Dhedy, best known as AKD, believe that the current boom at the stocks market was natural and a reaction to the May 11 political development that put PML-N in the

alysts at Topline Research foresee a neutral impact of the new fiscal plan on equity market. “The federal budget for 2013-2014 due on June 12 is likely to be a manifestation of the new government’s vision of fiscal responsibilities by increasing tax revenues, limiting non-developmental expenditures and instituting structural reforms, particularly in the energy sector,” said the analysts. The KSE, in its budget proposals, has asked for cut in corporate tax rates for listed companies to 25 percent. The SECP too has suggested a gradual reduction in corporate tax. Other proposals like compulsory cash payout and penalizing companies who do

driving seat to revive the politically-strategically-troubled country’s economy. “Yes, the boom is natural,” AKD told Pakistan Today. Other market bigwigs like Muhammad Yaseen Lakhani, former KSE chairman and sitting Board of Director, says the index was yet to hit the all time high. This, he said, is because of the investors’ confidence in the “pro-business” regime of Mian Nawaz Sharif who in the past had proved himself as business and industry-friendly. Many of the market participants whereas are upbeat that the new government would, reportedly on June 12, present a business-friendly federal budget, the an-

Overseas Pakistanis remit $12.76 billion in 11 months KARACHI STAFF REPORT

Pakistanis working abroad remitted over $12.76 billion during eleven months of the current fiscal ranging from July 2012 to May 2013, reported the central bank Monday. This, the State Bank said, shows an increase of 5.74 percent or $693.34 million compared to $12.069 billion the dollar-hungry country had received during the corresponding period of FY12. The inflow of remittances during the review months from Saudi Arabia, UAE, USA, UK, GCC countries, including Bahrain, Kuwait, Qatar and Oman and EU countries amounted to over $3.751 billion, $2.531 billion, $2.00 billion, $1.774 billion, $1.469 billion and $326.34 million, respectively. Last year the remittance inflows from the above destinations were recorded as above $3.353 billion, $2.629 billion, $2.127 billion, $1.394 billion, $1.366 billion and $335.55 mil-

lion, respectively. The remittances received from Norway, Switzerland, Australia, Canada, Japan and other countries amounted to $902.98 million as against $861.38 million received last year. On average the monthly remittance receipts for JulyMay period came out to $1.160 billion compared to $1.097 billion during the corresponding period of FY12. Last month in May, over $1.192 billion was sent back home by overseas Pakistanis registering a growth of 0.04 percent when compared with $1.192 billion the country had received in the same month of 2012. The said month saw the inflow of remittances from Saudi Arabia, UAE, USA, UK, GCC and EU countries standing at $379.96 million, $219.56 million, $186.29 million, $162.95 million, $138.03 million and $28.65 million, respectively. This was against last year’s inflows of $365.46 million, $243.46 million, $205.52 million, $130.71 million, $140.27 million and $30.96 million from

these countries and regions. The remittances received from Norway, Switzerland, Australia, Canada, Japan and other countries during May were counted as $77.18 million as against $75.73 million of May 2012. The worker remittances whereas appear to be the sole head that falls in positive zone on the country’s current account list, the newly-elected government tends to play down these receipts as unreliable source of foreign exchange for the country. The PML-N led government while intends to avoid it, Pakistan, the experts believe, is fast nearing a fresh bailout package from the IMF which has already approved, in principle, an extended facility of $ 5 billion during the international lenders’ Summer Meetings in Washington. Prime Minister Nawaz Sharif and his team rather are reported to have planned to broaden the tax net by expanding the existing 9.5 percent tax-toGDP ratio to 14 percent during the next five years of their constitutional tenure.

PIAF hOPeS new gOvt tO tAke PrIvAte SectOr On bOArD LAHORE APP

The Pakistan Industrial and Traders Association Front (PIAF) Monday hoped that Prime Minsiter Muhammed Nawaz Sharif would take private sector on board in the policy making process. Talking to a delegation of businessmen here, PIAF Acting Chairman Khamis Saeed Butt said the public in general and the business community in particular had reposed confidence in the Sharif brothers with expectations that their governments would utilize all available resources to remove economic ills. He also called for curtailing non-developmental expenditures and bringing untaxed sectors into the tax net to enhance government revenue besides dealing with corruption with an iron hand. The PIAF leader urged the new government to evolve an effective and viable strategy in consultation with stakeholders to revive economy. Uninterrupted supply of electricity and gas and promotion of merit and austerity would not only revive business activities but also attract much-needed foreign investment, he observed.

PAKISTAN, THAILAND AGREE TO SET UP JOINT BUSINESS COUNCIL KARACHI STAFF REPORT

President Federation of Pakistan Chambers of Commerce and Industry (FPCCI) Zubair Ahmed Malik has invited the delegation of Thailand Federation of Industry and Thailand Federation of Commerce, Board of Trade to visit Pakistan for holding talks on bilateral trade. Mailk along with Vice President FPCCI Shaheen Ilyas Sarwana called on Vice Chairman Thailand Federation of Chambers of Commerce and Chairman Working Group on FTA Ming Pant Chaya

during his Monday’s visit to Thailand and discussed various issues particularly establishing Pak-Thailand Joint Business Council and start its activities effectively in order to boost trade between the two countries and avail the opportunities of trade and tariff preferential. Malik also held a separate meeting with Pakistan’s Ambassador Suhail Mahmood. Mailk asked his counterpart to influence his government to allow on arrival visa to the Pakistani businessmen as practiced before. The FPCCI chief also asked the Ambassador to Thailand to take up this issue with the Thai government. He discussed the

issue of Joint Ministerial Meeting with his counterpart and suggested him to put some proposals in the forthcoming meeting for speeding up trade between the two friendly countries. He said during the meeting that despite having good trade and friendly ties the trade volume between the two countries is not at all satisfactory. He also invited Thailand’s federation to participate in Expo Pakistan 2013 scheduled to be held in September in Karachi. FPCCI chief also visited the Display Centre of Pakistan’s products at Pakistan’s Embassy, suggested to improve its quality of products, and offered

FPCCI’s services to improve the display of export goods at the display. He also suggested having a full-fledged display center in the city of Bangkok and rent out warehouse for the purpose. Malik said that Pakistan was an agricultural country and rich in natural resources. He said that gems and jewelry, fruits, poultry, livestock, food, construction, energy and agro based industries offer vast potential of joint venture investment and urged Thai business community to avail the opportunity. He assured to facilitate and provide all assistance and cooperation to Thai investors for this purpose.


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BUSINESS B Tuesday, 11 June, 2013

Japan economy heats up in first quarter TOKYO APP

Japan’s economy expanded faster than previously thought in the first quarter, according to fresh data Monday that was likely to boost support for Tokyo’s efforts at stoking growth. The Cabinet Office said revised data showed annualised growth came in at 4.1 percent in January-March, up from a preliminary reading of 3.5 percent and well ahead of many other industrialised nations who are struggling to stoke their economies. The figures come days after Prime Minister Shinzo Abe unveiled his so-called “third arrow” of a sweeping plan for the economy that includes big government spending and aggressive monetary easing by the Bank of Japan. Since winning landslide December elections, the conservative premier has moved to revive the flaccid economy and end years of growth-sapping deflation with a scheme dubbed “Abenomics”. His huge programme has sent the yen plunging around 20 percent since November, which has in turn sent shares in Tokyo soaring as the weaker currency benefits Japanese exporters. Markets were initially unimpressed by Abe’s announcement last week to put in place structural reforms to support growth but he has vowed to press on before midterm elections next month that are likely to solidify his Liberal Democratic Party’s legislative power. “The upward revision (for economic growth) confirmed that the Japanese economy remains on a firm recovery track,” said Hideki Matsumura, senior economist with the Japan Research Institute. The annualised figures, which show the level of growth if quarterly data were stretched over an entire year, comes as economists sift through recent figures for signs that Abenomics is taking hold.

US corporate investors lured to booming Pakistan equity market KARACHI

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STAFF REPORT

HE booming stocks market of Pakistan is expected to get a favorable and enthusiastic response from American institutional investors as the Karachi Stocks Exchnage (KSE) orgainsed a well-attended investmnet conference in New York on June 10. The KSE held “Pakistan Investment Conference” in partnership with Bloomberg LP, the leading global financial news and data provider, and in coordination with JS Global. Accoring to a KSE statement issued Monday, the moot brought together the top management of Pakistan’s most successful listed companies and several international financial institutions and potential investors from across the United States, including many well-known mutual funds invested in emerging and frontier markets. The event played an important role in generating awareness amongst the US investment community regarding investment opportunities in Pakistan’s capital market and also in creating a positive perception about Pakistan and its long term growth potential as a major emerging market with a large and vibrant domestic demand base. “Given the interest shown in the conference proceedings by participants it is expected that the stocks market of Pakistan should get a favorable and enthusiastic response from American institutional investors,” said the KSE statement. While addressing the conference, KSE Chairman Muneer Kamal highlighted the strong performance of the Pakistan’s equity market despite challenging global financial environment. The enthusiasm of international investors for Pakistan equities was a clear sign that confidence has been restored in the country’s capital market. No wonder, Pakistan market’s performance has been one of the best not only in Asia but also within the emerging and frontier markets universe in the last 12 months, with the KSE-100 Index rising by over 65% during this period. Kamal highlighted the important milestone in

Pakistan’s political history where, for the first time, there was change from one civilian government to another civilian government through the election process. He said the strong mandate of the new PML-N government meant policy implementations would likely be decisive and help stabilize the economy with action on key areas such as the power sector, taxation, privatization and improved governance. Furthermore, with all political players in Pakistan on the same page regarding improvement of relations with India, a new era of regional cooperation and surge in intra-regional trade was on the anvil which bode well for peace and economic development of South Asia, providing opportunity for global investors to participate in this growth. KSE Managing Director Nadeem Naqvi elaborated on the significant improvement in the capital market regulatory regime both at the SECP level as well as the exchanges level with focus on systemic risk management, post demutualization separation of regulatory and commercial functions of the exchanges to avoid conflict of interest and empowering investors to protect their interests. He also outlined efforts by the exchanges to encourage greater domestic retail investor participation in the equity market. Naqvi said the recent bullish move in the market was due to both strong corporate fundamentals and earnings growth in Pakistan as well as valuation expansion in anticipation that the new PML(N) government would move quickly to provide a conducive macro environment for private sector to take the lead in rejuvenating economic growth in the country. Given the PML (N) election manifesto of targeting GDP growth of 6% driven by accelerated industrial and export expansion, a budget deficit of near 4% underpinned by significant improvement in taxto-GDP ratio and a targeted subsidy regime only for the most needy segments of the population, market expectations were that turn around in the economic fortunes of the country was definitely possible under the new government. He said the effective GDP of Pakistan was not $228 billion but rather nearer to $ 330 billion if the huge undocumented economy was taken into account.

Major Gainers COMPANY MithchellsFruit Abbott Lab. Salfi Textile SPOT Hinopak Motor Linde Pakistan

OPEN 473.29 323.63 201.50 136.15 178.51

HIGH 496.95 334.00 210.00 142.95 186.90

LOW 470.00 320.50 210.00 141.75 179.00

CLOSE 496.95 333.25 210.00 142.95 184.96

CHANGE 23.66 9.62 8.50 6.80 6.45

TURNOVER 3,700 11,000 500 18,500 1,200

1780.00 345.00 1550.00 285.50 306.10

1740.00 345.00 1520.00 285.50 301.50

1740.00 345.00 1535.25 285.50 301.50

-60.00 -16.40 -14.75 -14.50 -8.50

250 100 550 100 1,900

7.07 9.90 4.90 11.93 12.24

6.67 8.94 4.10 11.46 12.00

6.75 9.61 4.17 11.58 12.06

-0.26 -0.33 -0.72 -0.04 -0.06

24,796,000 23,354,000 15,921,000 13,600,000 11,684,000

Major Losers Bata (Pak) Pak Services Wyeth Pak Ltd Dreamworld Murree Brewery

1800.00 361.40 1550.00 300.00 310.00

Volume Leaders Bankislami Pakistan 7.01 P.I.A.C.(A) 9.94 B.O.Punjab(R) 4.89 TRG Pakistan Ltd. 11.62 Fauji Cement 12.12

Interbank Rates USD GBP JPY EURO

PKR 98.5048 PKR 153.2833 PKR 1.0255 PKR 130.4992

Forex BUY US Dollar Euro Great Britain Pound Japanese Yen Canadian Dollar Hong Kong Dollar UAE Dirham Saudi Riyal

99.50 129.97 153.05 0.9911 96.30 12.56 26.90 26.40

SELL 99.75 130.22 153.30 0.9996 97.82 12.77 27.10 26.65

Public corporate firms rules effective from July 8 KARACHI: The federal government has extended the implementation date of the 2013 Public Sector Companies (Corporate Governance) Rules to July 8. The rules were issued by the Securities and Exchange Commission of Pakistan (SECP) with approval of the federal government vide SRO 180(I)/2013 on March 8. The new rules were to take effect after 90 days of the issuance of this notification on June 8. “Now, in pursuance of the aforesaid extension, a notification amending rule 1(2) of the rules has been published in the official gazette vide SRO 479(I)/2013 dated June 6, 2013, so as to extend the date of implementation of the rules to July 8,” said a statement issued by the SECP on Monday. STAFF REPORT

CORPORATE CORNER engro vopak terminal Limited awards scholarships to PQA Staff children Engro Vopak Terminal Limited (EVTL) awarded scholarships to children of Port Qasim Authority (PQA) staff, providing them an opportunity to learn technical and vocational skills at two renowned institutions, the Maritime Training Institute and the Hunar Foundation. EVTL awarded four full and two partial scholarships in three different categories. These scholarships will enable the beneficiaries to learn the trades of ship operation, welding, plumbing, mechanical and general electrician. Upon successful completion of the training, globally recognized diploma will be awarded to the students by the two Institutes. Sheikh Imranul Haque – CEO, Engro Vopak Terminal Limited, said, “EVTL has a history of facilitating upliftment of lives of host communities. We strive to provide development opportunities with provision of platforms to individuals to learn skills that enhance income generation leading to livelihoods thereby resulting in a lasting impact on their families”. The staff of Port Qasim Authority appreciated the efforts of Engro Vopak Terminal Limited and said that the initiative would help their children pursue avenues for skill development and would improve the quality of life for themselves and their families. PR

bank Alfalah leads financial services industry by adopting eco-friendly financial As part of Bank Alfalah’s efforts to promote financial solutions that are innovative, eco-friendly and costeffective, the Bank has signed a Memorandum of Understanding (MOU) with Buksh Energy. Through this collaboration, the bank will lead the financial services industry in converting to renewable energy sources, namely solar power with the aim of ‘’Going Green’’. The signing ceremony took place between Bank Alfalah and Buksh Energy in Lahore today.

Bank Alfalah’s President Atif Bajwa and Buksh Energy’s CEO Asim Buksh were present to mark the inception of a promising partnership between the two companies. The initiation of this alliance began with the successful installation of 2 KWp solar plants and the conversion of two of the Bank’s ATMs to solar power by Buksh Energy. The plants are capable of running the ATM, security system, branch servers and routers, as well as an independent light load, operating 24/7. The solar plant produces 12 KWh of energy per day (4.38 MWh per annum) per ATM converted on solar. The ATMs are connected to the online portal, where energy production is recorded and logged, and can be monitored. PR

LwMc issues de-silting plan ahead of monsoons

Prior to monsoon season, Lahore Waste Management Company (LWMC) has issued its de-silting plan June – September 2013. LWMC will de silt all 590 tertiary drains measuring total 413 kilometers. LWMC has deployed more than 450 dedicated workers to carry out this task. The objective of such an extensive cleaning of drains is to ensure free flow of rain water in these drains during monsoon season. This preventive measure will also make sure that small drains and gutters in residential and commercial areas of the city do not choke in upcoming season. The dedicated workers are being provided with the new uniforms, special health and safety gadgets and customized equipment like handcarts with waste bags fixed in these so that the de silted waste does not appear anywhere in streets and roads even during the operations. The assistant mangers of

operations and manager operations will supervise this plan and live supervision will be performed with android based phones by uploading operations pictures every day. The timings of de-silting operations in urban areas will be from 10pm to 6am whereas in rural union councils this operation will be done during daytime. PR

teradata among ‘leaders’ for 8th consecutive year Teradata Corporation (NYSE:TDC), the global leader in analytic data platforms, applications and services, announced its positioning in the “Leaders” quadrant of the “Magic Quadrant for MultiChannel Campaign Management” (MCCM) report by industry analyst firm Gartner, Inc. The report was written by Adam Sarner and Julie Hopkins research directors at Gartner, and was published May 30, 2013. Gartner Magic Quadrants evaluate category vendors on their “ability to execute” and “completeness of vision”. Teradata, which has been positioned in the “Leaders” quadrant of the MCCM report every year since the study began in 2006, believes its placement reflects long standing marketplace receptivity to its Customer Interaction Management (CIM) solutions and underscores its solid strategic direction for Integrated Marketing Management overall. In addition to Customer Interaction Management, Teradata’s solutions for Data Driven Marketing comprise Marketing Operations, Digital Messaging, analytics and data warehousing capabilities that help customers drive more effective marketing performance. According to the Gartner report, “MCCM leaders consistently do considerably better in overall campaign management performance for basic and advanced campaigns, as well as for integration with digital marketing. PR

better business with visa: 2013 commercial Businesses looking for better ways to manage their time and money can now enjoy benefits and savings on essential business services and products

in the new 2013 Visa Commercial Offers Program. Designed to enhance the efficiency of small businesses’ processes and improve their bottom line, the program encompasses more than 60 special deals across business travel and accommodation, travel-related services and business support services and is available to Visa Business, Visa Corporate and Visa Purchasing cardholders in Asia Pacific, Central Europe, Middle East and Africa. (APCEMEA) Cardholders can enjoy best-available hotel rates with perks such as access to private areas in hotels and resorts, complimentary Wi-Fi, complimentary breakfast and late checkout. For those travelling on a budget, Visa has partnered with Hertz for special rental packages offering free day rentals. Small businesses can also make day-to-day business operations a little more enjoyable with discounts for client gifting services and subscriptions to essential news publications. “The cards business in Pakistan is thriving with each passing day but at the same time it is becoming very competitive. Today’s cardholders need a reason for using a card and I think Visa through their commercial offers program provides a complete solution to all cardholders need,” said Kamil Khan, Country Manager, Visa Pakistan and Afghanistan. PR

Soneri bank Limited opens its first corporate branch in Lahore

Left to right: Syed Babar Ali of Packages Group, Soneri Bank Ltd Chairman Alauddin Feerasta, Rupali Group Chairman Jafferali Feerasta, Country Credit Head Amin Feerasta Soneri Bank. PR


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