KARACHI, Sept 21: The modaraba sector has achieved some very important milestone of success consolidation and corporate evaluation during the previous year.

The Chairman of Modaraba Association of Pakistan (MAP), Adil A Ghaffar, stated this at an annual general meeting of the association held at the Institute of Bankers Pakistan here on Tuesday.

Giving an account of the important events of the year, Mr Ghaffar dealt with various steps taken by the outgoing executive committee of the association in promoting the perception and image of the modaraba sector, improving the mutual understanding and management capacity of the sector.

First Equity Modaraba (FEM) diversified it operations in 2002 and bought stock exchange membership cards of all three stock exchanges and two offices at KSE for a total investment of Rs32.5m.

In the year 2003 FEM paid 22.50 per cent dividend to its certificate holders while in the currant year FEM declared cash dividend at a rate of 42.50 per cent. In addition, FEM has also announced issuing of 100 per cent right shares to its certificate holders at a premium of Rs5 per share.

The FEM is the first modaraba that has enhanced its capital through right issues followed by First Habib Modaraba, which declared a cash dividend of 20pc and 100pc right shares at a premium of Rs2.50 per share.

Al-Zamin Leasing Modaraba floated Mustharaka based term finance certificates during the year under review. The private placement of Rs200 million has been substantially oversubscribed. An sum of Rs250 million was offered to general public, which was heavily oversubscribed.

It indicates an overwhelming support of the investor particularly from the financial sector, the MAP chief observed. Similarly, he said that other modarabas had also been successful in diversifying the products and were getting into newer lines of business such as CNG manufacturing, trading etc.

The general body appreciated the performance of the executive committee under the leadership of Mr Ghaffar during the year under review. The newly constituted committee for the year 2004-2005 included Zubair R. Palwala (chairman), Muhammad Shoaib (vice-chairman), M. Javed Parwaz (member), Wasim Ul Haq Osmani (member), Shariq Saleem (member), Majid A. Jhumra (member), M. Siddique Memon (member) and Asad Ali Shaikh (member). -APP