Last Updated on Tuesday, 30 November 1999 05:00 Tuesday, 29 June 2010 10:48
KARACHI : The Fatima Fertilizer Company Limited (FFCL) is planning to issue American Depository Receipts (ADRs) by the end of 2010. The FFCL would be the first Pakistani company to issuing ADRs and to be listed in the US stock exchanges. The company s CEO, Fawad Ahmed Mukhtar, during analysts briefing, pointed out that the Bank of New York Melon is assisting the firm in this regard.
Due to proximity to the market, the management said it feels that the marketing and distribution cost would be lower than its competitors. The strong marketing arm of Pak Arab Fertiliser would facilitate Fatima Fertilisers, the management told the briefing.
The company s own projection has shown EPS of Rs 2.8 in 2011 and Rs 3.6 in 2012. Though no details of break-up and assumptions were provided, but we feel there are so many risks associated with this, like acceptability of CAN and NP in the local market, gas shortages, debt repayment and ongoing teething issues , Farhan said.
Bilal Qamar, an analyst at JS Global Capital, said: In the light of the latest figures, along with delays in urea production by 2 months, we have revisited our production and sales estimates and we now expect the company to sell 392,000 tons and 340,000 tons of urea and CAN respectively in 2010 against 442,000 tons and 363,000 tons earlier.
The increase in prices of both urea and CAN is likely to more than offset the impact of our downward revision in FFCL s new production and sales estimates. Consequently, our 2010 earnings estimates now arrive at Re 0.11 per share against Re 0.05 per share earlier.
The NP plant, however, is still under construction and is expected to come on line by December 2010, as per expectations, he said. According to the management, the ongoing gas curtailment does not pose a hindrance to the company at the moment, as the NP plant has still not begun operation. However, if this curtailment continues in the long term, we believe it will become a major challenge for the company, especially when its NP plant is commissioned in December 2010 , he added.
Courtesy: Business Recorder
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