| Fifth ICP Mutual Fund |
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| 28th
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: |
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MUTUAL FUNDS DEPARTMENT: |
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| NBP
Building, 5th Floor |
Dawood Centre, Ground
Floor |
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| 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 28th 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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|
|
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|
(Rs. '000') |
|
|
| Net
(Loss) before Taxation |
|
(2,524) |
|
| Taxation |
|
|
(493) |
|
|
|
|
------------------ |
|
| Net
(Loss) after Taxation |
|
(3,017) |
|
| Un-appropriated
income B/F |
|
12,313 |
|
|
|
|
------------------ |
|
| Available
for Appropriation |
|
9,296 |
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| Cash Dividend |
|
|
-- |
|
|
|
|
|
|
| Un-appropriated
Income carried forward to |
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|
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| Revenue
Reserve |
|
9,296 |
|
|
|
|
|
|
| Basic
(Loss) per certificate (in rupees) |
|
(0.60) |
|
|
| 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. |
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| 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 under review the Fifth Mutual Fund earned total income of Rs. 8.35
million including dividend income of |
|
| Rs.4.26
million. The main reason for the loss of Rs.2.52 million was Rs.8.91 million
on account of diminution the value |
|
| of
investments. NAV's worked out at Rs.12.82 per certificate as compared to
Rs.9.96 last year. |
|
|
| Future
Prospects |
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| 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 |
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| 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 |
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| support. |
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|
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|
for the Investment Corporation of Pakistan |
|
|
|
ISTAQBAL MEHDI |
|
SYED LIAQUAT ALI |
|
M. SALEEM SHAIKH |
|
|
Managing Director |
|
Director |
|
Director |
|
|
|
|
| BALANCE
SHEET AS AT 30 JUNE 2000 |
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|
|
|
Note |
2000 |
1999 |
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|
|
|
Rupees |
Rupees |
|
| NET ASSETS |
|
|
| Investment
in quoted shares |
|
3 |
55,553,333 |
47,237,397 |
|
| [Market
value Rs.60,396,894 (1999: Rs.34,761,499)] |
|
|
| Long
term deposit |
|
|
100,000 |
100,000 |
|
|
|
| Current assets |
|
| Dividend
receivable |
|
1,280,000 |
800,000 |
|
| Prepaid
expenses |
|
-- |
7,500 |
|
| Current
account with the Investment Corporation |
|
|
|
| of Pakistan (ICP) |
|
|
3,466,395 |
15,754,179 |
|
| Cash at bank |
|
|
24,980 |
-- |
|
|
|
------------------ |
------------------ |
|
|
|
4,771,375 |
16,561,679 |
|
|
|
|
| Current
liabilities |
|
|
|
| Accrued
expenses |
|
|
13,400 |
19,338 |
|
| Provision
for taxation - net |
|
|
35,407 |
472,081 |
|
| Unclaimed
dividend |
|
|
1,004,550 |
1,019,232 |
|
|
|
|
------------------ |
------------------ |
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|
|
|
1,053,357 |
1,510,651 |
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|
|
|
------------------ |
------------------ |
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|
|
|
3,718,018 |
15,051,028 |
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|
|
|
------------------ |
------------------ |
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|
|
Rupees |
59,371,351 |
62,388,425 |
|
|
========== |
========== |
|
|
| FINANCED BY |
|
|
|
| Capital
and Reserves |
|
|
|
| Capital |
|
|
|
| Authorised |
|
| 5,000,000
(1999: 5,000,000) |
|
50,000,000 |
50,000,000 |
|
| Certificates
of Rs. 10 each |
|
========== |
========== |
|
|
| Issued,
subscribed and paid-rip |
|
| 5,000,000
(1999: 5,000,000) Certificates |
|
50,000,000 |
50,000,000 |
|
| of
Rs. 10 each fully paid in cash |
|
|
|
| Revenue
reserve |
|
| Special reserve |
|
|
75,000 |
75,000 |
|
| Unappropriated
income |
|
|
9,296,351 |
12,313,425 |
|
|
|
|
------------------ |
------------------ |
|
|
|
Rupees |
59,371,351 |
62,388,425 |
|
|
|
========== |
========== |
|
|
| 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 |
|
|
4,263,762 |
3,891,614 |
|
| Return
on current account with the ICP |
|
1,605,587 |
1,353,708 |
|
| Profit
on sale of investments |
|
2,483,670 |
2,266,208 |
|
| Miscellaneous |
|
|
-- |
3,523 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
8,353,019 |
7,15,053 |
|
|
|
|
|
| EXPENDITURE |
|
|
|
| Management fee |
|
4 |
1,758,803 |
1,372,638 |
|
| Auditors'
remuneration |
|
5 |
22,867 |
19,590 |
|
| Diminution
in the value of investments |
|
8,907,229 |
509,725 |
|
| Other expenses |
|
6 |
188,051 |
2051290 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
10,876,950 |
2,107,243 |
|
|
|
|
| NET
(LOSS) / INCOME BEFORE TAXATION |
|
(2,523,931) |
5,407,810 |
|
|
|
|
| Taxation
- Current |
|
7 |
493,143 |
407,196 |
|
| - Prior |
|
|
-- |
46,285 |
|
|
|
|
------------------ |
------------------ |
|
|
|
|
493,143 |
453,481 |
|
|
| NET
(LOSS)/INCOME FOR THE YEAR |
|
(3,017,074) |
4,954,329 |
|
|
| UNAPPROPRIATED
INCOME BROUGHT FORWARD |
12,313,425 |
7,359,096 |
|
|
|
|
------------------ |
------------------ |
|
| UNAPPROPRIATED
INCOME CARRIED FORWARD |
9,296,351 |
12,313,425 |
|
| TO
REVENUE RESERVE |
|
|
|
|
|
|
------------------ |
------------------ |
|
| BASIC
(LOSS) / EARNINGS PER CERTIFICATE |
8 |
(0.60) |
0.99 |
|
|
|
========== |
========== |
|
|
|
|
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 |
1,815,603 |
2,431,111 |
|
| Sale
of investments |
|
|
4,383,475 |
9,066,805 |
|
| Purchase
of investments |
|
|
(19,122,970) |
(9,225,420) |
|
| Taxes paid |
|
|
(929,817) |
-- |
|
|
|
|
------------------ |
------------------ |
|
| Net
cash (outflow) / inflow from operating activities |
|
(13,853,709) |
2,272,496 |
|
|
|
|
========== |
========== |
|
|
| CASH
FLOW FROM INVESTING ACTIVITIES |
|
| Return
on current account with the ICP |
|
1,605,587 |
1,353,708 |
|
|
|
------------------ |
------------------ |
|
| Net
cash inflow from investing activities |
|
1,605,587 |
1,353,708 |
|
|
| CASH
FLOW FROM FINANCING ACTIVITIES |
|
| Dividend paid |
|
|
(14,682) |
(1,191,291) |
|
|
|
------------------ |
------------------ |
|
| Net
cash outflow from financing activities |
|
(14,682) |
(1,191,291) |
|
|
========== |
========== |
|
|
| NET
(DECREASE) / INCREASE IN CASH & CASH EQUIVALENTS |
(12,262,804) |
2,434,913 |
|
| CASH
EQUIVALENTS AT THE BEGINNING OF THE YEAR |
15,754,179 |
13,319,266 |
|
|
|
|
------------------ |
------------------ |
|
| CASH
& CASH EQUIVALENTS AT THE END OF THE YEAR |
10 |
3,491,375 |
15,754,179 |
|
|
|
|
========== |
========== |
|
|
|
|
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 |
|
|
|
|
|
Capital |
Revenue Reserve |
|
|
|
|
|
|
|
|
Issued, |
Special |
Unappropriated |
Total |
|
|
|
Subscribed and |
reserve |
Income |
|
|
|
|
& paid up |
|
|
|
|
Rupees |
Rupees |
Rupees |
Rupees |
|
|
| Balance
as at 30 June 1998 |
50,000,000 |
75,000 |
7,359,096 |
57,434,096 |
|
|
| Net
Income for the year |
-- |
-- |
4,954,329 |
4,954,329 |
|
|
|
|
------------------ |
------------------ |
------------------ |
------------------ |
|
|
| Balance
as at 30 June 1999 |
50,000,000 |
75,000 |
12,313,425 |
62,388,425 |
|
|
| Net
loss for the year |
-- |
-- |
(3,017,074) |
(3,017,074) |
|
|
|
|
------------------ |
------------------ |
------------------ |
------------------ |
|
|
| Balance
as at 30 June 2000 |
50,000,000 |
75,000 |
9,296,351 |
59,371,351 |
|
|
|
|
========== |
========== |
========== |
========== |
|
|
| 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 of investment and to encourage investment in shares
of companies quoted on the stock exchanges in the country. |
|
| Fifth
ICP Mural Fund was established by the Investment Corporation of Pakistan
(ICP), acting as its trustee, on June 26, 1972, |
|
| under
the ICP Ordinance, 1966. The Fund is listed on all three stock exchanges in
Pakistan. |
|
|
| 2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
|
|
|
|
|
| 2.1
Accounting convention |
|
|
|
| These
accounts have been prepared under the historical cost convention, without
taking any effect of inflation. |
|
|
| 2.2 Investments |
|
|
|
| i)
Investment are 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 revised book values and; |
|
|
| iii)
profit or loss on sale of investment is accounted for in the year in which it
arises. |
|
|
| 2.3 Taxation |
|
| Provision
for taxation is based on taxable income at current rates for taxation after
taking into account tax |
|
| credits
available, if any. |
|
|
| 2.4
Revenue recognition |
|
|
| i)
Dividend income is accounted for at the closure of share transfer books of
the company declaring dividend; |
|
|
| ii)
Return on current account with the ICP is accounted for on the basis of the
PLS rate declared half yearly by the 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 |
|
|
|
| 89,200 |
103,200 |
First Grindlays Modaraba |
10.52 |
937,970 |
14.58 |
1,300,536 |
10.52 |
1,085,250 |
12.25 |
1,264,200 |
|
| 27,000 |
27,000 |
Habib Bank Modaraba |
6.87 |
185,535 |
7.08 |
191,160 |
6.87 |
185,535 |
6.17 |
166,500 |
|
|
|
|
|
|
INVESTMENT BANKS |
|
|
| 106,009 |
118,341 |
Bank Al-Habib Ltd. |
14.53 |
1,540,825 |
14.93 |
1,582,714 |
17.44 |
2,064,025 |
18.00 |
2,130,138 |
|
|
|
|
|
|
TEXTILE AND SPINNING |
|
|
| 20,000 |
-- |
Gadoon Textile |
|
40.00 |
800,000 |
28.30 |
566,000 |
-- |
-- |
-- |
-- |
|
| 85,000 |
-- |
Ibrahim Textile |
|
17.60 |
1,495,600 |
11.50 |
977,500 |
-- |
-- |
-- |
-- |
|
| 50,000 |
-- |
Nagina Cotton |
|
10.73 |
536,250 |
15.50 |
775,000 |
-- |
-- |
-- |
-- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SUGAR |
|
|
|
| 13,310 |
12,100 |
Dewan Sugar Mills Ltd. |
16.14 |
214,775 |
15.00 |
199,650 |
17.75 |
214,775 |
17.75 |
214,775 |
|
| 49,177 |
51,617 |
Shahmurad Sugar Mills
Ltd. |
9.23 |
453,346 |
9.50 |
466,612 |
9.23 |
476,421 |
17.75 |
916,202 |
|
|
|
|
|
|
CEMENT |
|
|
|
| 40,000 |
50,000 |
Cherat Cement Company
Ltd. |
19.18 |
767,010 |
21.48 |
859,200 |
19.17 |
958,710 |
13.00 |
650,000 |
|
| -- |
40,000 |
Lucky Cement Ltd. |
-- |
-- |
-- |
-- |
3.82 |
152,800 |
3.82 |
152,800 |
|
|
|
|
|
|
FUEL AND ENERGY |
|
|
| 25,000 |
-- |
S.G. Power |
|
9.00 |
225,000 |
6.80 |
170,000 |
-- |
-- |
-- |
-- |
|
| 50,000 |
50,000 |
Kohinoor Energy Ltd. |
16.50 |
824,900 |
12.50 |
625,000 |
16.50 |
824,900 |
10.80 |
540,000 |
|
| 29,110 |
34,100 |
National Refinery Ltd. |
13.80 |
401,580 |
42.44 |
1,235,295 |
13.80 |
470,580 |
30.37 |
1,035,617 |
|
| 162,564 |
66,720 |
Pakistan State Oil
Company Ltd. |
141.54 |
23,009,090 |
163.10 |
26,514,188 |
138.35 |
9,230,720 |
92.75 |
6,188,280 |
|
| 35,767 |
57,189 |
Sui Northern Gas Company
Ltd. |
3.97 |
141,900 |
16.10 |
575,849 |
4.56 |
261,000 |
8.37 |
478,672 |
|
| 10,500 |
15,500 |
Shell Pakistan Ltd. |
134.73 |
1,414,700 |
267.63 |
2,810,115 |
134.73 |
2,088,350 |
163.00 |
2,526,500 |
|
| 56,500 |
56,500 |
Mari Gas |
|
21.13 |
1,193,950 |
18.30 |
1,033,950 |
21.13 |
1,193,950 |
17.90 |
1,011,350 |
|
| 40,000 |
40,000 |
S. Electric Power Company
Ltd. |
11.18 |
447,200 |
8.10 |
324,000 |
11.18 |
447,200 |
6.32 |
252,800 |
|
| 90,000 |
70,000 |
Hub Power Company Ltd. |
18.39 |
1,665,500 |
14.70 |
1,323,000 |
16.13 |
1,128,750 |
14.07 |
984,900 |
|
| 25,000 |
-- |
Ibrahim Energy |
|
15.20 |
380,000 |
12.70 |
317,500 |
-- |
-- |
-- |
-- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AUTO AND ALLIED
ENGINEERING |
|
|
| 60,000 |
60,000 |
Pak Suzuki Motors Company
Ltd. |
12.50 |
750,000 |
12.50 |
750,000 |
40.71 |
2,442,800 |
25.00 |
1,500,000 |
|
| 40,000 |
40,000 |
General Tyre and Rubber
Company Ltd. |
30.12 |
1,204,825 |
45.00 |
1,800,000 |
30.12 |
1,204,825 |
37.25 |
1,490,000 |
|
|
|
|
|
|
TRANSPORT AND
COMMUNICATION |
|
|
|
| 120,000 |
120,000 |
P.T.C.L. "A" |
|
30.40 |
3,648,350 |
27.08 |
3,249,600 |
30.40 |
3,648,350 |
20.02 |
2,402,400 |
|
|
|
|
|
|
|
|
|
CHEMICAL AND
PHARMACEUTICALS |
|
|
|
| 11,500 |
11,500 |
BOC Pakistan Ltd. |
129.57 |
1,490,100 |
114.00 |
1,311,000 |
129.57 |
1,490,100 |
81.00 |
931,500 |
|
| 447 |
447 |
Engro Chemicals
(Pakistan) Ltd. |
71.71 |
32,056 |
59.33 |
26,521 |
71.71 |
32,056 |
73.67 |
32,930 |
|
| 200,000 |
200,000 |
Fauji Fertilizer Company
Ltd. |
39.58 |
7,916,000 |
39.58 |
7,916,000 |
73.89 |
14,778,550 |
41.17 |
8,234,000 |
|
|
|
|
|
|
|
|
|
PAPER AND BOARD |
|
|
|
|
| 20,000 |
20,000 |
Cherat Papersack Company
Ltd. |
45.24 |
904,750 |
64.00 |
1,280,000 |
45.24 |
904,750 |
38.00 |
760,000 |
|
| 24,200 |
24,200 |
Century Papers &
Board Company Ltd. |
24.55 |
594,000 |
12.25 |
296,450 |
24.55 |
594,000 |
12.50 |
302,500 |
|
|
|
|
|
|
|
|
|
|
|
|
|
MISCELLANEOUS |
|
|
|
|
| 25,000 |
-- |
G. tec. Pak |
|
11.90 |
297,500 |
8.33 |
208,250 |
-- |
-- |
-- |
-- |
|
| 30,000 |
-- |
Tri-Pack Film |
|
36.12 |
1,083,500 |
29.98 |
899,400 |
-- |
-- |
-- |
-- |
|
|
|
|
|
|
------------------ |
|
------------------ |
|
------------------ |
|
------------------ |
|
|
|
|
Rupees |
55,553,333 |
|
60,396,894 |
|
47,237,397 |
|
34,761,499 |
|
|
|
|
|
========== |
|
========== |
|
========== |
|
========== |
|
| *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 (RI) is payable @ 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 on initial paid-up capital @ 1/2% |
|
| of
Rs. 5.00 million |
|
25,000 |
25,000 |
|
|
|
|
|
|
| Management
fee on capital raised in prior years through RI |
|
| @ 3%
of net assets market value of the Fund, in proportion of |
|
| capital
raised through RI to total paid-up capital, after |
|
| charging
management fee |
|
4.1 |
1,733,803 |
1,347,638 |
|
|
|
|
|
------------------ |
------------------ |
|
|
1,758,803 |
1,372,638 |
|
|
========== |
========== |
|
|
| 4.1
Market value of net assets at the close of financial year |
|
| after
charging management fee |
|
| Investments
on quoted shares |
|
3 |
60,396,894 |
34,761,499 |
|
| Long
term deposit |
|
100,000 |
100,000 |
|
|
| Current assets |
|
|
|
| Dividend
receivable |
|
1,280,000 |
800,000 |
|
| Prepaid
expenses |
|
-- |
7,500 |
|
| Current
account with the ICP |
|
3,466,395 |
15,754,179 |
|
| Cash at bank |
|
24,980 |
-- |
|
|
------------------ |
------------------ |
|
|
4,771,375 |
16,561,679 |
|
|
------------------ |
------------------ |
|
|
65,268,269 |
51,423,178 |
|
|
|
|
| Current
Liabilities |
|
| Accrued
expenses |
|
13,400 |
19,338 |
|
| Provision
for taxation - net |
|
35,407 |
472,081 |
|
| Unclaimed
dividend |
|
1,004,550 |
1,019,232 |
|
|
------------------ |
------------------ |
|
|
1,053,357 |
1,510,651 |
|
|
------------------ |
------------------ |
|
|
|
64,214,912 |
49,912,527 |
|
|
========== |
