Category: Industry

The National Electric Power Regulatory Authority (NEPRA) has given decision on the utility's Transmission and Distribution Investment Plan till FY2030 which will catalyze the company's efforts to reduce losses in transmission and distribution, drive growth in its customer base, and bolster the power utility's infrastructure to meet current demands and future needs, KE said in a statement on Wednesday. Investment in power utility infrastructure is essential to ensure a smooth, stable, safe, and uninterrupted supply of electricity to a growing number of customers. Since privatization, investment of Rs. 544 billion has enabled KE to double its customer base, double the power consumption of this customer base, and more than halve its TandD losses, KE said. It said that the plan was submitted in accordance with regulatory guidelines and a hearing was held in March 2023 where KE management apprised stakeholders regarding the projects being planned from FY2024 to FY2030. For this period, KE has clearly identified priorities and projects for investment areas such as growth, energy loss reduction, network rehabilitation, maintenance, and safety. Digitization is also a central area of focus in these operational areas. The investment plan outlines projects to install more AMRs and implement technology such as Advanced Distribution Management Systems and Meter Data Management Systems to strengthen internal processes and introduce more transparency as well, it added. On the transmission front, the plan envisages the addition of grids and transmission lines which will further strengthen the reliability of KE's network and enable the offtake of additional power from the National Grid, the company said. Commenting on the occasion, CEO KE Moonis Alvi stated, 'Over the next 7 years, we are looking to invest $2 billion in Transmission and Distribution to manage the city's needs through targeted investments and tech-based interventions. I'd like to acknowledge the efforts of all stakeholders who have been a part of this journey and who will continue to work with us to modernize our infrastructure and prepare us for the future.' The investment plan complements the company's Power Acquisition Program through which KE has outlined its vision to achieve 30% share of renewable energy in its generation mix by 2030. In this regard the company has also received regulatory approval on RFPs of 640MW renewable projects which is another critical link in the mission to enable access to affordable energy for all. Our teams at K-Electric are reviewing NEPRA's decision in detail and will remain engaged with NEPRA, and as we move forward, a sustainable and cost reflective tariff remains critical for timely execution of the investment plan, the statement added. Source: Pro Pakistani

Aamir Khan, Commissioner Insurance at SECP stated that the adoption of international reporting standards for modernizing Pakistan's insurance industry is a critical priority for SECP as a regulator of the insurance sector. He was delivering the keynote address at the Institute of Chartered Accountants of Pakistan (ICAP) seminar on IFRS 17 Implementation. Khan stressed the importance of IFRS-17 adoption by January 1, 2026, as any delay could lead to Pakistan's market lagging behind international markets. He emphasized the responsibility of stakeholders and SECP as regulators in implementing IFRS-17 and the need for familiarization with its impact on decision-making. The seminar was attended by representatives from the Korean Accounting Standards Board industry players, experts, consultants, and SECP policy department personnel. Insurance, he said, being an integral component of the overall financial sector, serves as an automatic stabilizer by mitigating the economy's sensitivity to macroeconomic shocks i n addition to being a saving and capital formation tool. Despite the potential to promote sustainable finance, and support long-term risk-taking, the Insurance landscape of Pakistan has remained underdeveloped. The comparison to its peers representing less than 1% of GDP, is one of the lowest in the region. As of 2022, the total assets stood at PKR 2.42 trillion (circa USD 10.5 billion) with the written premium standing at Rs. 553 billion (c. USD 2.5 billion). Despite the small industry size and a fragmented structure with 42 active players, the insurance industry offers tremendous potential. In this regard, the SECP embarked on the initiative of identifying gaps and challenges in the insurance industry, jointly with industry stakeholders, and formulated the 5-year Strategic Plan which was launched in December 2023. One of the key priority areas of the 5-year strategic plan is the achievement of financial stability through the adoption of International Financial Reporting Standards and Risk-Based capital re gimes for the insurance industry. Fundamentally, IFRS 17 is designed to bring about greater transparency and consistency in financial reporting in the insurance industry. Being a globally accepted accounting standard for the measurement of insurance contracts, the adoption of IFRS-17 shall allow the international markets to look positively at the Pakistani insurance market, and make the comparative assessment easier. Through reflection of information related to underwriting and investment activities on the financial statements, in a transparent manner, it can serve as a game-changer in building trust and confidence among investors, regulators, existing and potential policyholders, as well as other stakeholders, such as rating agencies and reinsurers. SECP expects IFRS 17 also to be a key catalyst for insurers to review, if not overhaul, business processes across the organization. This will be driven by at least three factors: First, the need for business units to capture broader and more granular informat ion required for financial reporting; Second, changes in the way performance is measured under the new standard; And third, increased opportunities for insurers to differentiate themselves from the competition, helped by a more integrated view of performance. These considerations will have wide implications for organizations' structures, data-capturing mechanisms, risk management, product design and development, and systems. Recognizing the importance of standardized financial reporting, the SECP is actively engaged in the process of implementing IFRS 17 and aligning related regulatory frameworks to support transitioning to the new standard. In collaboration with ICAP, the PSOA, and the insurance industry, the SECP envisaged a four-phased approach for the implementation of IFRS 17, where work under phase 3 - System Design and Methodology, is underway. Given that the majority of international markets adopted the standard either last year or this year, meeting the adoption timeline of January 1, 2026, is c ritical and an absolute priority for SECP's team looking at insurance policy. Source: Pro Pakistani

Allied Bank Limited (PSX: ABL) announced earnings (PAT) today for 1QCY24 at Rs. 11.6 billion, depicting an increase of 51 percent YoY, however down 5 percent QoQ. According to Arif Habib Limited (AHL), the decrease in earnings QoQ was mainly attributed to reduced markup and non-markup income. However, on a YoY basis, higher income and provisioning reversals contributed to an increase in overall profitability. Along with the result, ABL announced a cash dividend of Rs. 4.0 per share. In the 1QCY24, the bank reported a Net Interest Income of Rs. 29.2 billion, marking a significant 43 percent rise from the same period in the previous year. However, this figure represents a 10 percent decline from the preceding quarter. Interest earned surged by 28 percent compared to the previous year and saw a modest 1 percent increase from the previous quarter. On the other hand, interest expenses witnessed a 22 percent increase compared to the same period last year and a 7 percent uptick compared to the prior quarter. I n the outgoing quarter, non-markup income continued its downward trend, experiencing a 4 percent YoY decline and a more significant 16 percent QoQ decrease. This decline was primarily driven by a substantial drop in FX income, which plummeted by 61 percent YoY and 62 percent QoQ. Additionally, gains on securities were down by 28 percent QoQ, totaling Rs. 303 million in 1QCY24. However, there was a contrasting positive trend in Fee Income, which showed robust growth. Fee Income surged by 45 percent YoY and 20 percent QoQ, reaching Rs. 4 billion in 1QCY24. In the 1QCY24, the bank reported a reversal in provisioning of Rs. 163 million, marking a significant turnaround from the provisioning charge of Rs. 2.3 billion recorded in the same period last year. The operating expense of the bank clocked in at Rs. 13.6 billion in 1QCY24, up 16 percent YoY and 10 percent QoQ. With this, the Cost/income ratio stood at 39.9 percent for 1QCY24, down from 42.9 percent in the same period last year. The effective tax rate fo r the bank was set at 49 percent during 1QCY24, showing an increase from 43 percent in the same period last year. ABL posted earnings per share (EPS) of Rs. 4 for Q1 2024 compared to an EPS of Rs. 2.5 in the same period last year. Source: Pro Pakistani

The Pakistani rupee fell third day in a row against the US Dollar after opening trade at 278 in the interbank market. It was largely stable against the greenback but crashed against other major currencies today. The interbank rate stayed at 278.5 most of the day before closing at the same level. Open market rates across multiple currency counters were in the 278 level today. The PKR depreciated by 0.01 percent to close at 278.39 after losing two paisas against the dollar today. On a fiscal year-to-date basis, the rupee has so far appreciated by 2.68 percent. Overall, the rupee is down nearly Rs. 51.49 since January 2023. Since April 2022, it is down Rs. 95.49 against the greenback. As per the exchange rate movements seen today, the PKR lost two paisas today. The PKR was red against all of the other major currencies in the interbank market today. It halted losses against the UAE Dirham (AED) but lost one paisa against the Saudi Riyal (SAR), 37 paisas against the Canadian Dollar (CAD), 41 paisas against the Euro (EUR), and Rs. 2.65 against the Australian Dollar (AUD). It lost Rs. 2.02 against the British Pound (GBP) in today's interbank currency market. Source: Pro Pakistani

The government has requested the World Bank for restructuring of Higher Education Development in Pakistan (HEDP) project of worth $400 million for third time to allow for the completion of critical IT and IT-related activities and the full achievement of Performance Based Condition (PBCs). Official documents revealed that the project is in its fifth year of implementation and its objective is to support research excellence in strategic sectors of the economy, improve teaching and learning and strengthen governance, in the higher education sector. The government requested an extension with the revised closing date of June 30, 2025. This extension will help HEC achieve a strengthened digital learning infrastructure contributing to a more resilient higher education system in Pakistan. The overall project implementation progress is rated moderately satisfactory. Of the 13 intermediate results indicators, 02 have already been met, 09 are likely to be met, and 02 are unlikely to be met. The project has made imp lementation significant progress. The disbursement from IDA Credit as of February 29, 2024, is $278.30 million, including $258.19 million against PBCs and $20 million for the Investment Project Financing (IPF) component. Despite the overall reasonable implementation progress, the IT-related procurements under Component 3 had been taking longer than anticipated because of: (i) delayed hiring of IT staff and initiation of IT-related activities, (ii) approvals and completion cycle of several procurements taking longer than anticipated and, (iii) need for revision of the procurement strategy to address capacity challenges of the local IT market. Procurements valuing $50.5 million are under implementation or have been advertised, and another $14.5 million are in the pipeline. The restructuring also entails changes in four PBCs, whereby (a) PBC 1 Year 4 (iii) target to be shifted to year 6 due to the delay in the completion of the Sustainable Development Goal (SDG) dashboard; (b) PBC 1 year 5 (iii) target to be d ropped as development of the portal and allied procurement took longer than anticipated; (c) PBC 11 year 3 (i) target to be shifted to Year 5 as the draft Open and Distance Learning Policy (ODLP) is expected to be approved by February 2024, and subsequently implemented; (d) revise the wording of PBC 5 to apply to both Affiliated Colleges and Affiliating Universities, including retroactive revision of the target for PBC 5 year 3 (iii) and; (e) PBC 11 year 5 (i) target to be shifted to year 6 as with the ODLP approved in year 5, HEC will implement the framework for one year and will hold stakeholder consultations for feedback collection. The dropped PBC 1 Year 5 (iii) target and PBC 11 Year 4 target do not constitute a risk to achieving the PDO. The project has been restructured twice. The first restructuring was approved on June 14, 2021, to respond to the COVID-19 pandemic impacts and involved: (a) introduction of Component 6 to support continued learning for all in case of unpredicted crises and university lockdowns and provision of special funds to universities to increase their financial autonomy, (b) reallocation of funds between Components to better address ongoing needs, and (c) revision of the Results Framework to reflect the changes in activities. The second project restructuring was approved on June 15, 2023, to repurpose the unutilized funds from lapsed targets under PBC 1 and PBC 2 toward: (i) a new round of Rapid Technology Transfer Grants (RTTGs) focused on topics related to emergency response, climate change, extreme weather event preparedness and import replacement research (PBC 1, Component 1); (ii) a new target to track RTTG outcomes (PBC 2, Component 1); and (iii) an increased target for universities participating in the framework for improvement in financial autonomy (PBC 10, Component 6). Source: Pro Pakistani

Standard Chartered Bank (Pakistan) Limited (PSX: SCBPL) has attributed the recent 'unusual movement' in its share price to the bank's strong financial performance in the calendar year ending December 31, 2023 (CY23). 'We understand that the positive trend in the price of the shares of SCBPL was triggered with the announcement of financial results on 23 February 2024 as investors reacted favorably to the strong financial performance of the Bank in the backdrop of an overall bullish trend in the stock market,' the bank explained to the main bourse on Wednesday. The bank recalled that it had announced its annual financial results for CY23 which showcased unprecedented financial performance for the period and posted the highest-ever Profit Before Tax of Rs. 89.2 billion enabled SCBPL to declare its best dividend since its incorporation. The combined dividend announced by the bank for 2023 stood at 90 percent i.e. Rs. 9 per share. The bank said, 'We would also like to furnish that the Bank is not aware of any other development/information that may be relevant to the unusual movement in the price of the shares of the Bank'. The Bank remains fully committed to meticulous compliance with all the regulatory provisions and will continue to ensure immediate dissemination of any price-sensitive information to PSX, the filing added. SCBPL's response comes after PSX earlier this week demanded the bank alongside three other listed firms to explain the reason behind the unusual movement in their share prices. At the time of filing, the bank's scrip at the bourse was Rs. 55.1, up 2.89 percent or Rs. 1.55 with a turnover of 47,500 shares on Wednesday. Source: Pro Pakistani