| Fourth ICP Mutual Fund |
|
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|
|
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|
|
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| 30th
Annual Report-2000 |
|
|
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| INVESTMENT
CORPORATION OF PAKISTAN |
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|
If undelivered please
return to: |
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| HEAD OFFICE: |
|
MUTUAL FUNDS DEPARTMENT: |
|
| NBP
Building, 5th Floor |
Dawood Centre, Ground
Floor |
|
| I.I.
Chundrigar Road, Karachi. |
Moulvi Tamizuddin Khan
Road, Karachi. |
|
| Phones:
9212360-69 |
Phones: 5686014-15,
5685104-05 |
|
| Telefax;
92-21-9212388-89 |
Telefax: 92-21-9202783 |
|
| E-mail:
icp@paknet2-3.pct.pk |
E-mail:
icp@paknet2-3.pct.pk |
|
|
|
| Directors'
Report to the Certificate Holders |
|
| for
the Year Ended June 30, 2000 |
|
|
| The
Mutual Fund's 30th Annual Report for the year ended June 30, 2000 is hereby
being presented for your review. |
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|
|
| Financial
Results |
|
| The
financial results of the Mutual Fund for the year under review are summarized
as under: |
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|
|
|
(Rs. '000') |
|
|
| Net
Income before Taxation |
|
16,497 |
|
| Taxation |
|
|
-- |
|
|
|
|
------------------ |
|
| Net
income after Taxation |
|
16,497 |
|
| Un-appropriated
income B/F |
|
2,234 |
|
|
|
|
------------------ |
|
| Available
for Appropriation |
|
18,731 |
|
| Cash
Dividend (30%) |
|
15,000 |
|
| Un-appropriated
Income earned forward to |
|
| Revenue
Reserve |
|
3,731 |
|
|
|
|
| Basic
Earning per certificate (in rupees) |
|
3.30 |
|
|
| Mutual
Fund Operation |
|
| The
policy measures taken by the present Government for the implementation of its
economic and structural reforms has helped in |
|
| improving
the stock market situation. The stock market index after remaining stable
between 1100-1200 points from July to |
|
| October
1999 started rising from November and continued upward trend till March 2000
when it went as high as 2054 points. |
|
| However,
the upward trend could not be sustained beyond March 2000 and the index
dipped at 1521 points as on June 30, 2000. |
|
|
| During
the year the Fourth Mutual Fund earned total income of Rs.23.66 million
including dividend income of Rs. 10.28million |
|
| Net
income for the year after including expenditure of Rs.4.96 million and
Rs.2.19 million on account of diminution in the value o |
|
| investments
amounted to Rs.16.51 million. NAV's worked out at Rs.43.76 per certificate as
compared to Rs.22.12 last year. |
|
|
| Future
Prospects |
|
| The
stock market situation is likely to improve due to Government's steady
measures to strengthen capital market. Such measures |
|
| include
agreement with IMF, acceleration of the privatisation process, expected
resolution of Hubco dispute and average corporate |
|
| earnings
growth of 14% expected for FY2001 etc. Your management will closely monitor
the situation to maximize return on its |
|
| investment
portfolio. |
|
|
| Pattern
of Certificate Holdings |
|
| The
pattern of certificate holding is annexed herewith. |
|
|
| Auditors |
|
| Our
present auditors M/s. Taseer, Hadi, Khalid & Company and M/s. Ford,
Rhodes, Robson, Morrow retire and being eligible |
|
| offer
themselves for re-appointment. |
|
|
| Acknowledgement |
|
| In
the end we wish to express our thanks to all our certificate holders, bankers
and other financial institutions for their continued |
|
| support. |
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|
|
|
for the Investment Corporation of Pakistan |
|
|
|
|
|
|
ISTAQBAL MEHDI |
|
SYED LIAQUAQ |
|
M. SALEEM SHAIKH |
|
|
Managing Director |
|
Director |
|
Director |
|
|
|
|
| Karachi:
7 - 12-2000 |
|
|
|
| BALANCE
SHEET AS AT 30 JUNE 2000 |
|
|
|
|
Note |
2000 |
1999 |
|
|
|
|
Rupees |
Rupees |
|
|
|
| NET ASSETS |
|
| Investment
in quoted shares |
|
3 |
51,129,063 |
56,309,592 |
|
| [Market
value Rs 201,862,178 (1999: Rs.114,791,515) |
|
|
| Security
deposit |
|
100,000 |
100,000 |
|
|
| Current assets |
|
| Dividend
receivable |
|
|
300,000 |
200,000 |
|
| Prepaid
expenses |
|
|
-- |
7,500 |
|
| Current
account with the Investment Corporation |
|
|
|
|
| of
Pakistan (ICP) |
|
|
20,326,889 |
8,902,893 |
|
| Taxation - net |
|
|
183,812 |
101,188 |
|
| Cash at bank |
|
|
224,980 |
-- |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
21,035,681 |
9,211,581 |
|
|
|
|
| Current
liabilities |
|
| Accrued
expenses |
|
|
13,400 |
19,338 |
|
| Unclaimed
dividend |
|
|
3,520,035 |
3,367,843 |
|
| Dividend
payable |
|
|
15,000,000 |
10,000,000 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
|
18,533,435 |
13,387,181 |
|
|
------------------ |
------------------ |
|
|
|
2,502,246 |
(4,175,600) |
|
|
|
------------------ |
------------------ |
|
|
|
Rupees |
53,731,309 |
52,233,992 |
|
|
|
========== |
========== |
|
|
|
|
|
| F1NANCED BY |
|
| Capital
and Reserves |
|
| Capital |
|
| Authorised |
|
| 5.000,000 Certificates of
Rs. 10/- each |
Rupees |
50,000,000 |
50,000,000 |
|
|
========== |
========== |
|
|
|
|
| Issued,
subscribed and paid-up |
|
| 5,000,000
Certificates of Rs. 10/- each fully paid in cash |
50,000,000 |
50,000,000 |
|
|
| Revenue
reserve |
|
| Unappropriated
income |
|
|
3,731,309 |
2,233,992 |
|
|
|
|
------------------ |
------------------ |
|
|
|
Rupees |
53,731,309 |
52,233,992 |
|
|
|
========== |
========== |
|
|
| The
annexed notes form an integral part of these accounts |
|
|
|
|
for the Investment Corporation of Pakistan |
|
|
|
ISTAQBAL MEHDI |
|
SYED LIAQUAT ALI |
|
M. SALEEM SHAIKH |
|
|
Managing Director |
|
Director |
|
Director |
|
|
|
| INCOME
AND EXPENDITURE ACCOUNT |
|
| FOR
THE YEAR ENDED 30 JUNE 2000 |
|
|
|
|
Note |
2000 |
1999 |
|
|
|
|
Rupees |
Rupees |
|
| INCOME |
|
| Dividend |
|
10,277,843 |
7,903,417 |
|
| Return
on current account with ICP |
|
778,740 |
529,736 |
|
| Profit
on sale of investments |
|
12,607,155 |
(1,300,960) |
|
| Other income |
|
|
-- |
8,350 |
|
|
|
------------------ |
------------------ |
|
|
|
23,663,738 |
7,140,543 |
|
|
| EXPENDITURE |
|
| Management
fee |
|
4 |
4,683,753 |
2,610,034 |
|
| Auditors'
remuneration |
|
5 |
21,335 |
14,730 |
|
| Diminution
in the value of investments |
|
2,195,369 |
3,349,012 |
|
| Other expenses |
|
6 |
265,964 |
210,594 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
7,166,421 |
6,184,370 |
|
|
|
|
------------------ |
------------------ |
|
| INCOME
BEFORE TAXATION |
|
|
16,497,317 |
956,173 |
|
| TAXATION
- Prior |
|
7 |
-- |
(115,630) |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
-- |
(115,630) |
|
|
| INCOME
AFTER TAXATION |
|
|
16,497,317 |
1,071,803 |
|
| UNAPPROPRIATED
INCOME BROUGHT FORWARD |
2,233,992 |
11,162,189 |
|
|
|
|
------------------ |
------------------ |
|
| AVAILABLE
FOR APPROPRIATION |
|
18,731,309 |
12,233,992 |
|
| Final
divided @ 30% (1999: 20%) |
|
|
15,000,000 |
10,000,000 |
|
|
------------------ |
------------------ |
|
|
Rupees |
3,731,309 |
2,233,992 |
|
|
========== |
========== |
|
|
| BASIC
EARNINGS PER SHARE (CERTIFICATE) |
8 |
3.30 |
0.21 |
|
|
========== |
========== |
|
|
|
|
| The
annexed notes form an integral part of these accounts. |
|
|
|
|
for the Investment Corporation of Pakistan |
|
|
|
ISTAQBAL MEHDI |
|
SYED LIAQUAT ALI |
|
M. SALEEM SHAIKH |
|
|
Managing Director |
|
Director |
|
Director |
|
|
|
| CASH
FLOW STATEMENT |
|
| FOR
THE YEAR ENDED 30 JUNE 2000 |
|
|
|
|
Note |
2000 |
1999 |
|
|
|
|
Rupees |
Rupees |
|
|
|
| CASH
FLOW FROM OPERATING ACTIVITIES |
|
| Cash
generated from operations |
|
9 |
5,208,253 |
5,144,036 |
|
| Sale
of investments |
|
|
16,797,115 |
5,832,559 |
|
| Purchase
of investments |
|
(1,204,800) |
-- |
|
| Taxes paid |
|
|
(82,614) |
(123,365) |
|
|
|
|
------------------ |
------------------ |
|
| Not
cash inflow from operating activities |
|
20,718,044 |
10,854,130 |
|
|
|
|
|
|
|
| CASH
FLOW FROM INVESTING ACTIVITIES |
|
| Return
on current account with ICP |
|
778,740 |
529,736 |
|
|
|
|
------------------ |
------------------ |
|
| Net
cash inflow from investing activities |
|
778,740 |
529,736 |
|
|
|
|
| CASH
FLOW FROM FINANCING ACTIVITIES |
|
| Dividend paid |
|
|
|
(9,847,808) |
(13,251,472) |
|
|
|
|
------------------ |
------------------ |
|
| Net
cash used in financing activities |
|
(9,847,808) |
(13,251,472) |
|
|
|
|
------------------ |
------------------ |
|
| NET
INCREASE / (DECREASE) 1N CASH & CASH EQUIVALENTS |
11,648,976 |
(1,867,606) |
|
| CASH
& CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR |
8,902,893 |
10,770,499 |
|
|
|
|
------------------ |
------------------ |
|
| CASH
& CASH EQUIVALENTS AT THE END OF THE YEAR |
10 Rupees |
20,551,869 |
8,902,893 |
|
|
|
========== |
========== |
|
|
|
|
| The
annexed notes form an integral part of these accounts. |
|
|
|
|
for the Investment Corporation of Pakistan |
|
|
|
ISTAQBAL MEHDI |
|
SYED LIAQUAT ALI |
|
M. SALEEM SHAIKH |
|
|
Managing Director |
|
Director |
|
Director |
|
|
|
| STATEMENT
OF CHANGES IN EQUITY |
|
| FOR
THE YEAR ENDED 30 JUNE 2000 |
|
|
|
Issued, |
Unappropriated |
Total |
|
|
Subscribed and |
Income |
|
|
|
paid up capital |
|
|
|
Rupees |
Rupees |
Rupees |
|
|
| Balance
as at 30 June 1998 |
|
50,000,000 |
11,162,189 |
61,162,189 |
|
| Net
income for the year |
|
-- |
1,071,803 |
1,071,803 |
|
| Dividend |
|
-- |
(10,000,000) |
(10,000,000) |
|
|
|
------------------ |
------------------ |
------------------ |
|
| Balance
as at 30 June 1999 |
|
50,000,000 |
2,233,992 |
52,233,992 |
|
| Net
income for the year |
|
-- |
16,497,317 |
16,497,3127 |
|
| Dividend |
|
-- |
(15,000,000) |
(15,000,000) |
|
|
|
------------------ |
------------------ |
------------------ |
|
| Balance
as at 30 June 2000 |
|
50,000,000 |
3,731,309 |
53,731,309 |
|
|
========== |
========== |
========== |
|
|
| The
annexed notes form an integral part of these accounts. |
|
|
|
|
for the Investment Corporation of Pakistan |
|
|
|
ISTAQBAL MEHDI |
|
SYED LIAQUAT ALI |
|
M. SALEEM SHAIKH |
|
|
Managing Director |
|
Director |
|
Director |
|
|
|
| NOTES
TO THE ACCOUNTS |
|
| FOR
THE YEAR ENDED 30 JUNE 2000 |
|
|
| 1.
THE FUND AND ITS OPERATIONS |
|
| In
order to broaden the base and to encourage investment in shares of companies
quoted on the stock exchanges in the country, |
|
| the
Fourth ICP Mutual Fund was established by the Investment Corporation of
Pakistan (ICP), acting as its trustee, on May |
|
| 13,
1970 under the ICP Ordinance. 1966. The Fund is listed on the stock exchanges
in Pakistan. |
|
|
| 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
|
|
|
|
| 2.1
Basis of preparation |
|
|
|
| These
accounts have been prepared in accordance with International Accounting
Standards, as applicable in Pakistan. |
|
|
| 2.2
Accounting convention |
|
|
|
| These
accounts have been prepared under the historical cost convention. |
|
|
| 2.3 Investment |
|
|
|
|
| i)
Investment is valued at average cost where cost is lower than the market
value, determined on the basis of the average of |
|
| the
highest and lowest quotation on the balance sheet date. |
|
|
| ii)
In cases where market value is lower than carrying value, the carrying value
is reduced to recognise other than temporary |
|
| decline,
i.e. for a period not less than three years in order to arrive at their book
value; and |
|
|
|
|
| iii)
profit or loss on sale of investment is accounted for in the year in which it
arises. |
|
|
| 2.4 Taxation |
|
| Provision
for taxation is based on taxable income at current rates for taxation after
taking into account tax credits available, if any. |
|
|
| 2.5
Revenue recognition |
|
| i)
Dividend income is accounted for at the closure of share transfer books of
the company declaring dividend; and |
|
|
| ii)
Return on current account with ICP is accounted for on the basis of PLS rate
declared half yearly by a bank on PLS |
|
| bank accounts. |
|
|
| 3.
INVESTMENTS IN QUOTED SHARES |
|
| Unless
stated otherwise, the holdings are in the Ordinary shares of Rs. 10/- each. |
|
|
| 2000 |
1999 |
|
2000 |
|
1999 |
|
| *Holding |
Name of company |
Book value |
Market value |
Book value |
Market value |
| No. of shares |
|
**Rate |
Amount |
**Rate |
Amount |
**Rate |
Amount |
**Rate |
Amount |
|
|
Rupees |
|
Rupees |
|
Rupees |
|
Rupees |
|
MODARABAS |
|
|
| 1,500 |
54,000 |
First Grindlays Modaraba |
10.25 |
15,375 |
14.58 |
21,870 |
10.20 |
550,875 |
12.25 |
661,500 |
|
|
|
|
BANKS/INVESTMENT BANKS |
|
| 200,000 |
241,500 |
Askari Commercial Bank
Ltd. |
18.64 |
3,728,440 |
13.88 |
2,776,000 |
18.64 |
4,502,000 |
12.07 |
2,914,905 |
| 70,188 |
83,490 |
Bank Al-Habib Ltd. |
14.06 |
987,000 |
14.93 |
1,047,907 |
16.88 |
1,409,000 |
18.00 |
1,502,820 |
|
|
|
|
TEXTILE SPINNING |
|
| 40,000 |
10,000 |
Al-Hamid Textile Mills
Ltd. |
7.63 |
305,300 |
6.00 |
240,000 |
3.50 |
35,000 |
4.00 |
40,000 |
|
|
|
|
SUGAR AND ALLIED
INDUSTRIES |
|
| 37,332 |
47,333 |
Bawany Sugar Mills Ltd. |
8.00 |
298,656 |
8.00 |
298,656 |
11.50 |
544,200 |
10.48 |
496,050 |
| 19,965 |
18,150 |
Dewan Sugar Mills Ltd. |
16.13 |
322,162 |
15.00 |
299,475 |
17.75 |
322,162 |
17.75 |
322,162 |
|
|
|
|
CEMENT |
|
|
| 50,000 |
50,000 |
Cherat Cement Company
Ltd. |
19.20 |
960,340 |
21.48 |
1,074,000 |
19.21 |
960,340 |
13.00 |
650,000 |
| -- |
30,000 |
Lucky Cement Ltd. |
-- |
-- |
-- |
-- |
3.82 |
114,600 |
3.82 |
114,600 |
|
|
|
|
FUEL AND ENERGY |
|
| 71,795 |
71,795 |
Karachi Electric Supply
Corporation Ltd. |
4.83 |
347,209 |
9.53 |
684,206 |
4.84 |
347,208 |
8.67 |
622,463 |
| 60,000 |
70,000 |
National Refinery Ltd. |
14.76 |
885,900 |
42.45 |
2,547,000 |
14.76 |
1,033,500 |
30.37 |
2,125,900 |
| 898,068 |
803,390 |
Pakistan State Oil
Company Ltd. |
3.84 |
3,453,059 |
163.10 |
146,474,891 |
4.61 |
3,707,159 |
92.75 |
74,514,422 |
| 47,500 |
47,500 |
Shell Pakistan Ltd. |
134.70 |
6,398,600 |
267.63 |
12,712,425 |
134.71 |
6,398,600 |
163.00 |
7,742,500 |
| 147,335 |
128,118 |
Sui Northern Gas
Pipelines Company Ltd. |
3.97 |
585,000 |
16.10 |
2,372,094 |
4.52 |
585,000 |
8.37 |
1,072,348 |
| 314,592 |
290,950 |
Sui Southern Gas Company
Ltd. |
20.17 |
6,348,400 |
16.38 |
5,153,017 |
23.21 |
6,752,000 |
8.60 |
2,502,170 |
|
|
|
|
AUTO AND ALLIED
ENGINEERING |
|
| 66,125 |
66,125 |
Crescent Steel Mills Ltd. |
15.00 |
991,875 |
17.00 |
1,124,125 |
15.00 |
991,875 |
15.00 |
991,875 |
| 50,000 |
50,000 |
Pak Suzuki Motors Company
Ltd. |
12.50 |
625,000 |
12.50 |
625,000 |
43.43 |
2,171,300 |
25.00 |
1,250,000 |
|
|
|
|
TRANSPORT AND
COMMUNICATION |
|
|
| 30,000 |
-- |
P.T.C.L. "A" |
|
31.15 |
934,500 |
27.08 |
812,400 |
-- |
-- |
-- |
-- |
|
|
|
|
|
|
|
CHEMICAL AND
PHARMACEUTICALS |
|
|
| 875 |
875 |
Engro Chemicals
(Pakistan) Ltd. |
81.16 |
71,021 |
59.33 |
51,914 |
81.17 |
71,022 |
73.67 |
64,461 |
| 100,000 |
200,000 |
F.F.C. Jardan Fertilizer
Company Ltd. |
9.05 |
905,000 |
9.05 |
905,000 |
14.24 |
2,847,525 |
11.25 |
2,250,000 |
| 50,000 |
50,000 |
Fauji Fertilizer Company
Ltd. |
41.17 |
2,058,500 |
39.58 |
1,979,000 |
41.17 |
2,058,500 |
41.17 |
2,058,500 |
| 900,097 |
900,097 |
ICI Pakistan Ltd. |
21.27 |
19,147,970 |
15.13 |
13,618,468 |
21.27 |
19,147,970 |
9.00 |
8,100,873 |
|
|
|
|
|
|
|
PAPER AND BOARD |
|
|
|
| 116,925 |
116,926 |
Packages Ltd. |
|
15.05 |
1,759,756 |
60.25 |
7,044,731 |
15.05 |
1,759,756 |
41.00 |
4,793,966 |
|
|
|
|
------------------ |
|
------------------ |
|
------------------ |
|
------------------ |
|
|
|
Rupees |
51,129,063 |
|
201,862,178 |
|
56,309,592 |
|
114,791,515 |
|
|
|
|
========== |
|
========== |
|
========== |
|
========== |
| *The
above shares are held in the name of the Investment Corporation of Pakistan
which acts as a Trustee to the Fund. |
|
|
|
|
| **
Rounded off to two decimal places. |
|
|
|
|
|
|
|
|
|
|
| 4.
MANAGEMENT FEE |
|
| The
management fee is payable to Investment Corporation of Pakistan @ 1/2% per
annum on the initial paid-up-capital of the Fund. |
|
| The
management fee in respect of the additional capital raised by way of Right
Issue is payable upto 3% per annum of the net assets |
|
| market
value of the Fund to be determined at the close of the financial. |
|
|
|
|
|
|
|
|
2000 |
1999 |
|
|
|
|
Rupees |
Rupees |
|
| Management
fee @ 1/2% per annum of the initial |
|
| paid-up
capital on Rs. 15 million |
|
75,000 |
75,000 |
|
|
|
|
|
|
| Management
fee on capital raised through right issue |
|
| @ 3% of net assets
market value of the Fund |
|
| 219,464,424
x 35,000,000 x 3% |
|
|
4,608,753 |
2,535,034 |
|
| 50,000,000 |
|
Rupees |
------------------ |
------------------ |
|
|
4,608,753 |
2,535,034 |
|
|
========== |
========== |
|
|
|
|
| 4.1
Market value of net assets at the close of the year |
|
| Investment
in quoted shares |
|
3 |
201,862,178 |
114,791,515 |
|
| Long
term deposit |
|
|
100,000 |
100,000 |
|
|
|
|
|
|
|
|
|
| Currant assets |
|
|
|
|
| Dividend
receivable |
|
300,000 |
200,000 |
|
| Prepaid
expenses |
|
-- |
7,500 |
|
| Current
account with ICP |
|
20,326,889 |
8,902,893 |
|
| Taxation-net |
|
183,812 |
101,188 |
|
| Cash at bank |
|
224,980 |
-- |
|
|
------------------ |
------------------ |
|
|
21,035,681 |
9,211,581 |
|
|
------------------ |
------------------ |
|
|
222,997,859 |
124,103,096 |
|
|
| Current
Liabilities |
|
| Accrued
expenses |
|
13,400 |
19,338 |
|
| Unclaimed
dividend |
|
3,520,035 |
3,367,843 |
|
|
------------------ |
------------------ |
|
|
3,533,435 |
3,387,181 |
|
|
------------------ |
------------------ |
|
|
Rupees |
219,464,424 |
120,715,915 |
|
|
========== |
========== |
|
|
| 5.
AUDITORS, REMUNERATION |
|
|
|
|
Taseer Hadi |
Ford, Rhodes, |
2000 |
1999 |
|
|
Khalid & Co. |
Robson, Morrow |
Rupees |
Rupees |
|
|
Rupees |
Rupees |
|
|
|
|
|
| Audit fee |
|
2,950 |
2,950 |
5,900 |
5,900 |
|
| Tax services |
|
15,435 |
-- |
15,435 |
8,830 |
|
|
------------------ |
------------------ |
------------------ |
------------------ |
|
|
18,385 |
2,950 |
21,335 |
14,730 |
|
|
========== |
========== |
========== |
========== |
|
|
| 6.
OTHER EXPENSES |
|
| Printing
and stationery |
|
13,604 |
14,688 |
|
| Advertising
and publicity |
|
2,373 |
11,518 |
|
| Professional
charges |
|
-- |
3,558 |
|
| Listing
fee - stock exchanges |
|
46,250 |
46,250 |
|
| Central
Depository Company |
|
25,000 |
27,081 |
|
| Computer
related expenses |
|
57,639 |
49,689 |
|
| Postage |
|
|
57,665 |
14,716 |
|
| Professional tax |
|
|
38,000 |
38,000 |
