January 11, 2002	Friday	Shawwal 26, 1422

KARACHI, Jan 10: Engro Chemical Pakistan Limited told the Karachi Stock Exchange on Thursday that the company ‘normally’ holds a Board Meeting for Annual General Meeting (AGM) purposes, around the end of January. It said that the closure of books for the purposes of AGM and any entitlements that may be declared were planned from March 14, 2002 for a period of 15 days.

Engro has assumably conveyed the information to the stock exchange on the latter’s query. But analysts say that if Engro does disclose the full year audited figures in January, it could again be the first company to unveil the annual results to end-December, within a month of the close of the year— unless Fauji Fertilizer, which also is understood to be ready with audited numbers, announces them first.

In the modified criteria for the top-25 companies awards, Karachi Stock Exchange has earmarked additional points for the quickest announcement of financial results after the close of the year.

Mohammed Sohail, head of research at brokerage firm, InvestCap, says that during the past few years, Engro’s scrip has witnessed four periods of activity. Every time the announcement of its financial results draw nearer, investors and punters turn their attention to this stock.

Since Engro announces quarterly results, the stock usually comes into the limelight at least four times a year. The rally this season has already picked up pace and with turnover of 5.4 million shares, the scrip gained 2 per cent on Wednesday, amid speculation that the company could announce bonus shares, this year as well.

The analyst says that since about a fourth of the equity is held by one fertilizer producer, the floating stock in Engro is small, which is why it experiences wide fluctuation in market price. Sohail forecasts improved Engro results for the year ended December 31, 2001, with the company expected to reach closer to its earlier year’s urea sales volume of 800,000 tons.

“According to our estimates, Engro has sold around 790,000 tons of urea fertilizer mainly on amount of better than expected sales in the month of December — 170,000 tons,” says InvestCap analyst. Gross margins are also expected to have edged up higher in 2001, compared with the previous year, mainly on account of higher retention price of urea and no gas price hike in September 2001.

“Moreover, closure of DAP production by Fauji Jordan has also provided ample opportunities to Engro to book decent trading profits,” InvestCap said, adding that their profit forecast was Rs1200 to 1250 million, representing earnings per share at Rs8.5 to Rs9 for 2001.