KARACHI, Oct 31: Negative reports about the PTCL deal after Etisalat failed to honour its final payment commitment within the extended deadline triggered panic selling in it and some other pivotals, but larger decline was averted thanks to presence of buying support at the dips.
The deal may be finally over, analysts said, adding that the settlement of the initial bid money may be on the cards. Whether or not it is to be confiscated under the terms and conditions of the agreement may now be an issue to be resolved.
Privatisation Minister Hafeez Sheikh is in Dubai to hold talks with the high-ups of Etisalat on it and some other issues, but the analysts predict there may not be an expected breakthrough as the stake is too big to be honoured by the bidder being apparently the second thought of the bidder.
Although PTCL was under pressure for the last couple of weeks because of an uncertainty over the issue, it came in for heavy renewed selling and fell by Rs3, ending well below its benchmark of Rs60 at Rs57 on 24m shares.
The analysts predict a further fall in its share values during the post-Eid trading as a pent-up selling is still there.
“Months-long uncertainty over the issue is at last over and it’s good for the market,” market sources said. “Investor will now plan their future line of action sans the PTCL irritant.”
The KSE 100-share index finished recovered from the early lows of 111 points at 8,247.34, off 70.02 points after having hit at one stage the session’s low of 8,135.49.
“The poignant end of the PTCL episode may have worried many, it appears logical as Etisalat has gone too far for no apparent positive reasons behind the price it chose to bid,” analysts said.
It will be futile to hope against the hopes as one thing is clear that the Dubai-based bidder has some pressing financial second thoughts on the deal and had to swallow a bitter pill apparently at the cost of its international reputation, they said.
“The PTCL episode, just at the heels of KSEC debacle after Kanooz al-Watan of Saudi Arabia backed out, may have dealt a serious blow to Pakistan’s future privatization programme for no fault of its own,” some others said.
Reports that the minister for privatization is to visit Dubai to have further talks on the issue with the Etisalat management or the case has been sent to the cabinet committee for final word on the deal is just procedural matter and may not have any positive bearings on the Etisalat decision, they said.
The market has been preparing for itself for the last about two weeks for the eventual Etisalat back out and those who have read too much in the happenings had already unloaded their long positions in it and are sitting pretty comfortable on the sidelines.
“I think from now onward the market is expected to follow its natural course as one of its major irritants has been removed and the post-Eid holiday trading could witness a wave of fresh buying,” brokers said. Active short-covering in the bank, oil and cement shares limited the market fall as a section of leading investors covered positions in them at the lower levels.
Both National Bank and Bank of Punjab and DG Khan and Fauji Cement and some pivotals on other counters performed credibly well and did not allow the market to be carried away by the failure of Etisalat to honour its payment commitments.
Prominent gainers were led by Millat Tractors, Noon Pakistan, Engro Chemical, Mustehkam Cement, National Bank and Askari Bank, up by Rs5 to Rs7.40. But the largest gains of Rs8, Rs11.25 and Rs19.05 were noted in Pakistan Cables, United Sugar and Pakistan Refinery.
Losers were led by Javed Omer, Glaxo-SKF, Packages, MCB, Arif Habib Securities, PNSC, International Industries, Artistic Denim, Shell Pakistan and Wyeth Pakistan, which suffered fall ranging from Rs3 to Rs15.
Trading volume fell to 234m shares from the previous 293m shares as losers held at modest lead over gainers at 136 to 126, with 27 shares holding on to the last levels.
DG Khan Cement topped the list of most actives, up Rs1.65 at Rs92.65 on 34m shares, followed by Fauji Cement, higher by 95 paisa at Rs19.60 on 32m shares, PTCL, sharply lower by Rs3 at Rs57.20 on 24m shares, National Bank, higher by Rs7.25 at Rs153.10 also on 24m shares and Bank of Punjab, up 50 paisa at Rs91.50 on 19m shares and MCB, off Rs3 at Rs146.80 on 17m shares.
Other actives were led by Pakistan Petroleum, off Rs2.05 on 10m shares, Faysal Bank, higher by Rs3.10 on 7m shares, Lucky Cement, off Rs1.50 on 6m shares and PSO, lower by one rupee also on 6m shares.
FORWARD COUNTER: DG Khan Cement also led the list of actives on the cleared list, up Rs1.50 at Rs94.25 on 9m shares, followed by National Bank, higher by Rs7.40 at Rs155.45 on 8m shares and Bank of Punjab, off Rs1.60 at Rs93.40 also on 8m shares.
Other actives included Pakistan Petroleum, off Rs2 at Rs202 on 6m shares, PTCL, down Rs3 at Rs57.75 also on 6m shares and some others also fell under the lead of PSO, OGDC and Pakistan Oilfields.
DEFAULTER COS: Barring Morafco Industries and Ghandhara Industries, which posted fresh gains of Rs2.60 and Rs2.70 at Rs55.15 and Rs60.60, respectively, on speculative support, others showed fractional either-way changes amid slow trading.
DIVIDEND: Clariant Pakistan, second interim 40 per cent; OGDC first interim 12.5 per cent; and Crescent Star Insurance, cash 10 per cent.
KARACHI, Oct 31: Negative reports about the PTCL deal after Etisalat failed to honour its final payment commitment within the extended deadline triggered panic selling in it and some other pivotals, but larger decline was averted thanks to presence of buying support at the dips.
Reports that the minister for privatization is to visit Dubai to have further talks on the issue with the Etisalat management or the case has been sent to the cabinet committee for final word on the deal is just procedural matter and may not have any positive bearings on the Etisalat decision, they said.
