Engro Equity Analysis

download Engro Equity Analysis

of 59

Transcript of Engro Equity Analysis

  • 7/27/2019 Engro Equity Analysis

    1/59

    Principles of Fi

    ACF-261

    Engro Chemical Pakis

    Prepared By:

    Section 3

    Imaad ud din

    Shahan Arshad Khan

    Syed Mohammad Ali Sha

    Rabia WaheedSilvat Gondal

  • 7/27/2019 Engro Equity Analysis

    2/59

    nance

    an Limited

    07 02 0224

    07 02 0325

    07 02 0375

    06 02 0170

    06 02 0402

  • 7/27/2019 Engro Equity Analysis

    3/59

    Engro Chemic al Pakistan Lim ited

    Balance Sheet

    Rupees in 000's 1983 1984 1985

    Cash and bank balances 18,607 45,392 86,348

    Net recieveables 10,550 70,262 21,858

    Stock in trade 20,376 12,627 15,221

    Other current assets 111,269 68,118 65,204

    Total current assets 160,802 196,399 188,631

    Net Plant Property and Equipm ent 127,641 116,794 105,497

    Long term inves tments 0 0 0

    Other assets 456 410 1,910

    Total long-term assets 128,097 117,204 107,407

    TOTAL A SSETS 288,899 313,603 296,038

    Creditors accrued and other l iabi l i t ies 99,859 126,941 107,626

    Shor t term bor rowings 698 10,990 653

    Other current l iabi l i t ies 66,928 49,504 50,253Total current l iabi l i t ies 167,485 187,435 158,532

    Total long term l iabi l i t ies 8,821 6,940 1,134

    Comm on equity + reserves 104,315 114,105 131,000

    Retained earnings 8,278 5,123 5,372

    Total shareholders ' equity 112,593 119,228 136,372

    TOTAL LIABILITIES AND SHAREHOLDER'S EQUITY 288,899 313,603 296,038

    Balancing 0 0 0

  • 7/27/2019 Engro Equity Analysis

    4/59

    1986 1987 1988 1989 1990 1991 1992

    133,930 89,635 112,158 201,232 237,536 244,814 364,079

    33,596 37,065 37,801 38,179 42,095 40,199 45,207

    19,808 42,840 13,748 15,444 39,933 91,444 9,323

    133,336 178,486 210,740 222,885 221,673 109,541 106,941

    320,670 348,026 374,447 477,740 541,237 485,998 525,550

    119,055 137,383 175,741 191,738 275,069 1,473,526 2,706,791

    0 0 0 0 0 0 0

    3,454 3,840 8,116 2,979 16,609 5,188 10,590

    122,509 141,223 183,857 194,717 291,678 1,478,714 2,717,381

    443,179 489,249 558,304 672,457 832,915 1,964,712 3,242,931

    159,142 156,411 219,624 269,678 408,106 291,548 253,970

    0 2,054 265 0 0 33,574 0

    86,638 80,924 76,791 120,459 108,786 143,850 178,872245,780 239,389 296,680 390,137 516,892 468,972 432,842

    15,162 17,585 26,976 25,675 59,872 1,080,106 1,780,440

    179,000 229,000 229,000 254,000 254,000 414,000 1,028,280

    3,237 3,275 5,648 2,645 2,151 1,634 1,369

    182,237 232,275 234,648 256,645 256,151 415,634 1,029,649

    443,179 489,249 558,304 672,457 832,915 1,964,712 3,242,931

    0 0 0 0 0 0 0

  • 7/27/2019 Engro Equity Analysis

    5/59

    1993 1994 1995 1996 1997 1998 1999

    497,563 1,020,544 1,030,218 1,298,555 1,334,861 707,098 565,947

    75,729 127,958 289,846 475,925 524,182 421,602 317,245

    51,708 122,208 124,679 129,967 173,288 442,141 344,138

    133,947 335,758 459,844 460,873 509,540 1,225,267 1,572,401

    758,947 1,606,468 1,904,587 2,365,320 2,541,871 2,796,108 2,799,731

    3,545,986 3,629,606 3,804,306 4,070,094 5,714,362 6,865,533 6,769,197

    0 13,591 0 455,000 642,500 1,173,500 1,341,475

    9,114 51,278 49,585 17,346 102,403 48,272 176,020

    3,555,100 3,694,475 3,853,891 4,542,440 6,459,265 8,087,305 8,286,692

    4,314,047 5,300,943 5,758,478 6,907,760 9,001,136 10,883,413 11,086,423

    427,801 466,482 589,851 830,713 935,964 1,150,967 1,067,870

    0 0 26,831 0 45,701 427,865 448,727

    174,179 642,907 855,322 883,923 803,837 748,681 1,027,429601,980 1,109,389 1,472,004 1,714,636 1,785,502 2,327,513 2,544,026

    2,482,018 2,030,908 1,693,525 1,786,543 3,263,904 3,939,496 3,603,817

    1,228,280 2,152,440 2,592,440 3,404,962 3,949,962 4,613,252 4,933,252

    1,769 8,206 509 1,619 1,768 3,152 5,328

    1,230,049 2,160,646 2,592,949 3,406,581 3,951,730 4,616,404 4,938,580

    4,314,047 5,300,943 5,758,478 6,907,760 9,001,136 10,883,413 11,086,423

    0 0 0 0 0 0 0

  • 7/27/2019 Engro Equity Analysis

    6/59

    2000 2001 2002 2003 2004 2005 2006

    508,084 973,412 2,156,541 1,651,068 3,775,958 4,776,698 5,760,668

    463,202 683,577 633,072 695,274 594,885 662,107 736,926

    368,752 424,870 771,055 385,582 458,081 509,845 567,457

    1,765,854 1,928,600 1,847,638 1,492,765 1,638,754 1,638,754 1,638,754

    3,105,892 4,010,459 5,408,306 4,224,689 6,467,679 7,587,404 8,703,804

    6,899,223 6,861,576 7,194,577 7,095,720 7,839,737 8,667,828 9,589,493

    1,341,475 1,340,000 1,340,000 1,424,557 1,424,557 1,424,557 1,424,557

    216,120 211,677 340,829 120,031 120,031 120,031 120,031

    8,456,818 8,413,253 8,875,406 8,640,308 9,384,325 10,212,416 11,134,081

    11,562,710 12,423,712 14,283,712 12,864,997 15,852,004 17,799,820 19,837,885

    1,396,479 1,650,593 2,095,963 1,301,570 2,283,719 2,541,779 2,829,000

    582,270 582,270 1,121,330 322,635 322,635 322,635 322,635

    467,768 1,025,928 1,386,757 1,305,142 2,091,362 2,962,721 3,928,8412,446,517 3,258,791 4,604,050 2,929,347 4,697,716 5,827,135 7,080,476

    3,897,592 3,925,034 4,349,386 4,272,111 4,894,220 5,447,266 6,062,807

    5,214,604 5,234,604 5,323,640 5,658,640 5,658,640 5,658,640 5,658,640

    3,997 5,283 6,636 4,899 601,429 866,778 1,035,962

    5,218,601 5,239,887 5,330,276 5,663,539 6,260,069 6,525,418 6,694,602

    11,562,710 12,423,712 14,283,712 12,864,997 15,852,004 17,799,820 19,837,885

    0 0 0 0 0 0 0

  • 7/27/2019 Engro Equity Analysis

    7/59

    2007 2008 2009 2010 2011 2012 2013

    6,805,646 7,938,866 9,204,410 10,617,562 12,181,540 13,957,685 15,910,777

    820,198 912,880 1,016,036 1,130,848 1,258,634 1,400,860 1,559,157

    631,580 702,948 782,381 870,790 969,190 1,078,708 1,200,602

    1,638,754 1,638,754 1,638,754 1,638,754 1,638,754 1,638,754 1,638,754

    9,896,178 11,193,449 12,641,582 14,257,955 16,048,118 18,076,007 20,309,290

    10,615,306 11,757,036 13,027,781 14,442,121 16,016,282 17,768,322 19,718,343

    1,424,557 1,424,557 1,424,557 1,424,557 1,424,557 1,424,557 1,424,557

    120,031 120,031 120,031 120,031 120,031 120,031 120,031

    12,159,894 13,301,624 14,572,369 15,986,709 17,560,870 19,312,910 21,262,931

    22,056,072 24,495,073 27,213,951 30,244,664 33,608,987 37,388,917 41,572,221

    3,148,677 3,504,478 3,900,484 4,341,238 4,831,798 5,377,791 5,985,482

    322,635 322,635 322,635 322,635 322,635 322,635 322,635

    5,000,428 6,189,402 7,509,027 8,974,066 10,600,951 12,407,971 14,415,4808,471,741 10,016,515 11,732,146 13,637,939 15,755,384 18,108,397 20,723,597

    6,747,905 7,510,418 8,359,095 9,303,673 10,354,988 11,525,102 12,827,438

    5,658,640 5,658,640 5,658,640 5,658,640 5,658,640 5,658,640 5,658,640

    1,177,787 1,309,500 1,464,070 1,644,412 1,839,975 2,096,778 2,362,546

    6,836,427 6,968,140 7,122,710 7,303,052 7,498,615 7,755,418 8,021,186

    22,056,072 24,495,073 27,213,951 30,244,664 33,608,987 37,388,917 41,572,221

    0 0 0 0 0 0 0

  • 7/27/2019 Engro Equity Analysis

    8/59

    2014

    18,096,020

    1,735,341

    1,336,270

    1,638,754

    22,806,385

    21,888,716

    1,424,557

    120,031

    23,433,304

    46,239,689

    6,661,841

    322,635

    16,646,13523,630,611

    14,276,939

    5,658,640

    2,673,499

    8,332,139

    46,239,689

    0

  • 7/27/2019 Engro Equity Analysis

    9/59

    Engro Chemic al Pakistan Lim ited

    Income Statement

    Rupees in 000's 1983 1984

    Sales 638,122 679,962

    Sales Grow th 6.56%

    Less: Cost of Goods Sold 381,599 434,171

    COGS as a % of Sales 59.80% 63.85%

    Gross Prof i t 256,523 245,791

    Gross Margin 40.20% 36.15%

    Less:Sel l ing and Admin ist rat ive Exp. 127,713 115,735

    Sel l ing & Adm inist rat ive expenses as a % of sales 20.01% 17.02%

    Add: Other Operat ing Incom e 0 0

    Less:Depreciat ion and Amort izat ion 15,772 16,087

    Depreciation Rate 12.60%

    Operating Pro fit (EBIT) 113,038 113,969

    Operat ing Margin 17.71% 16.76%

    Add:Other Incom e 3,392 8,240Other Income as a % o f Sales 0.53% 1.21%

    Less:Financial Charges 8,657 6,075

    Interest Rate 90.94% 33.88%

    Less:Other Charges 7,519 8,031

    Other Charges as a % of selling & administrative expense 5.89% 6.94%

    Pre-tax Incom e(EBT) 100,254 108,103

    Less:Provis ion for Taxat ion 47,519 44,058

    Tax Rate % 47.40% 40.76%

    Net Incom e 52,735 64,045

    Net Margin 8.26% 9.42%

    Unappropr iate Prof i t broug ht forward 2,343 8,278Prof i t Avai lable for Appro pr iat ion 55,078 72,323

    Dividends 46,800 57,200

    Pay out Rat io 88.7% 89.3%

    Transfer to General Reserve 0 10,000

    Transfer to Capital Reserve 0 0

    Unappropr iate Prof i t carr ied forward 8,278 5,123

    Weighted average number of Shares(000's) 10,400 10,400

    Earnings per Share 5.07 6.16

    Dividend per share 4.50 5.50

  • 7/27/2019 Engro Equity Analysis

    10/59

    1985 1986 1987 1988 1989 1990 1991

    696,577 754,354 826,303 810,025 936,664 1,276,754 1,543,629

    2.44% 8.29% 9.54% -1.97% 15.63% 36.31% 20.90%

    427,238 426,903 529,980 533,680 587,287 952,255 986,537

    61.33% 56.59% 64.14% 65.88% 62.70% 74.58% 63.91%

    269,339 327,451 296,323 276,345 349,377 324,499 557,092

    38.67% 43.41% 35.86% 34.12% 37.30% 25.42% 36.09%

    113,929 79,792 70,469 73,553 84,187 91,252 111,175

    16.36% 10.58% 8.53% 9.08% 8.99% 7.15% 7.20%

    0 0 0 0 0 0 0

    16,561 16,450 19,454 19,622 14,468 19,897 24,609

    14.18% 15.59% 16.34% 14.28% 8.23% 10.38% 8.95%

    138,849 231,209 206,400 183,170 250,722 213,350 421,308

    19.93% 30.65% 24.98% 22.61% 26.77% 16.71% 27.29%

    9,707 13,520 28,407 26,538 26,032 36,839 21,1141.39% 1.79% 3.44% 3.28% 2.78% 2.89% 1.37%

    5,359 8,214 1,735 6,129 14,646 4,319 21,718

    299.89% 54.17% 8.83% 22.50% 57.04% 7.21% 1.95%

    10,063 16,417 15,633 13,417 17,913 16,494 28,077

    8.83% 20.57% 22.18% 18.24% 21.28% 18.08% 25.25%

    133,134 220,098 217,439 190,162 244,195 229,376 392,627

    48,277 106,633 80,041 82,957 102,390 95,086 165,752

    36.26% 48.45% 36.81% 43.62% 41.93% 41.45% 42.22%

    84,857 113,465 137,398 107,205 141,805 134,290 226,875

    12.18% 15.04% 16.63% 13.23% 15.14% 10.52% 14.70%

    5,123 5,372 3,237 3,275 5,648 2,645 2,15189,980 118,837 140,635 110,480 147,453 136,935 229,026

    62,400 67,600 87,360 104,832 119,808 134,784 67,392

    73.5% 59.6% 63.6% 97.8% 84.5% 100.4% 29.7%

    22,208 48,000 50,000 0 25,000 0 160,000

    0 0 0 0 0 0 0

    5,372 3,237 3,275 5,648 2,645 2,151 1,634

    10,400 10,400 12,480 14,976 14,976 14,976 14,976

    8.16 10.91 11.01 7.16 9.47 8.97 15.15

    6.00 6.50 7.00 7.00 8.00 9.00 4.50

  • 7/27/2019 Engro Equity Analysis

    11/59

    1992 1993 1994 1995 1996 1997 1998

    1,874,676 2,324,819 3,567,559 4,520,004 7,168,114 6,658,958 8,365,530

    21.45% 24.01% 53.46% 26.70% 58.59% -7.10% 25.63%

    1,287,505 1,524,788 1,882,716 2,520,118 4,396,579 3,892,232 4,844,025

    68.68% 65.59% 52.77% 55.75% 61.34% 58.45% 57.90%

    587,171 800,031 1,684,843 1,999,886 2,771,535 2,766,726 3,521,505

    31.32% 34.41% 47.23% 44.25% 38.66% 41.55% 42.10%

    129,817 183,418 384,627 484,103 622,559 789,965 983,576

    6.92% 7.89% 10.78% 10.71% 8.69% 11.86% 11.76%

    0 0 0 0 0 0

    29,263 71,369 199,261 213,455 226,276 255,949 307,976

    1.99% 2.64% 5.62% 5.88% 5.95% 6.29% 5.39%

    428,091 545,244 1,100,955 1,302,328 1,922,700 1,720,812 2,229,953

    22.84% 23.45% 30.86% 28.81% 26.82% 25.84% 26.66%

    29,722 47,036 47,983 109,677 124,943 104,730 104,5751.59% 2.02% 1.34% 2.43% 1.74% 1.57% 1.25%

    11,915 97,914 337,904 326,119 284,586 369,039 404,595

    0.67% 3.94% 16.64% 18.96% 15.93% 11.15% 9.26%

    30,647 24,718 77,708 92,513 117,959 119,879 122,879

    23.61% 13.48% 20.20% 19.11% 18.95% 15.18% 12.49%

    415,251 469,648 733,326 993,373 1,645,098 1,336,624 1,807,054

    175,636 194,368 132,201 210,631 259,084 134,403 318,849

    42.30% 41.39% 18.03% 21.20% 15.75% 10.06% 17.64%

    239,615 275,280 601,125 782,742 1,386,014 1,202,221 1,488,205

    12.78% 11.84% 16.85% 17.32% 19.34% 18.05% 17.79%

    1,634 1,369 1,769 8,206 509 1,619 1,768241,249 276,649 602,894 790,948 1,386,523 1,203,840 1,489,973

    74,880 74,880 194,688 350,439 560,701 657,072 806,009

    31.3% 27.2% 32.4% 44.8% 40.5% 54.7% 54.2%

    165,000 200,000 400,000 440,000 795,000 545,000 595,000

    0 0 0 0 29,203 0 85,812

    1,369 1,769 8,206 509 1,619 1,768 3,152

    37,695 37,440 48,672 58,406 70,087 87,609 120,901

    6.36 7.35 12.35 13.40 19.78 13.72 12.31

    1.99 2.00 4.00 6.00 8.00 7.50 6.67

  • 7/27/2019 Engro Equity Analysis

    12/59

    1999 2000 2001 2002 2003 2004 2005

    8,628,367 8,393,880 8,220,158 10,893,319 12,173,006 13,983,485 15,563,618

    3.14% -2.72% -2.07% 32.52% 11.75% 14.87% 11.30%

    4,847,762 5,009,021 5,028,358 6,833,322 7,811,824 8,637,886 9,628,580

    56.18% 59.67% 61.17% 62.73% 64.17% 61.77% 61.87%

    3,780,605 3,384,859 3,191,800 4,059,997 4,361,182 5,345,598 5,935,038

    43.82% 40.33% 38.83% 37.27% 35.83% 38.23% 38.13%

    1,368,471 1,074,481 987,386 1,211,941 1,306,584 1,453,210 1,617,423

    15.86% 12.80% 12.01% 11.13% 10.73% 10.39% 10.39%

    0 70,000 0 10,000 0 0 0

    432,016 466,649 468,446 530,958 520,260 502,305 555,363

    6.29% 6.89% 6.79% 7.74% 7.23% 6.41% 6.41%

    1,980,118 1,913,729 1,735,968 2,327,098 2,534,338 3,390,083 3,762,253

    22.95% 22.80% 21.12% 21.36% 20.82% 24.24% 24.17%

    142,115 218,886 198,588 231,398 392,093 283,914 315,9971.65% 2.61% 2.42% 2.12% 3.22% 2.03% 2.03%

    674,490 683,525 645,795 575,510 371,810 713,559 789,323

    16.64% 15.26% 14.33% 10.52% 8.09% 13.68% 13.68%

    105,922 99,233 97,500 147,261 231,370 192,470 214,147

    7.74% 9.24% 9.87% 12.15% 17.71% 13.24% 13.24%

    1,341,821 1,349,857 1,191,261 1,835,725 2,323,251 2,767,968 3,074,780

    294,239 223,528 127,201 702,562 766,468 968,789 1,076,173

    21.93% 16.56% 10.68% 38.27% 32.99% 35% 35%

    1,047,582 1,126,329 1,064,060 1,133,163 1,556,783 1,799,179 1,998,607

    12.14% 13.42% 12.94% 10.40% 12.79% 12.87% 12.84%

    3,152 5,328 3,997 5,283 6,636 4,899 601,4291,050,734 1,131,657 1,068,057 1,138,446 1,563,419 1,804,078 2,600,036

    725,406 846,308 1,042,774 1,042,774 1,223,520 1,202,650 1,733,257

    69.2% 75.1% 98.0% 92.0% 78.6% 66.7% 66.7%

    320,000 100,000 20,000 (50,000) 335,000 0 0

    0 181,352 0 139,036 0 0 0

    5,328 3,997 5,283 6,636 4,899 601,429 866,778

    120,901 139,036 139,036 152,940 152,940 152,940 152,940

    8.66 8.10 7.65 7.41 10.18 11.76 13.07

    6.00 6.09 7.50 6.82 8.00 7.86 11.33

  • 7/27/2019 Engro Equity Analysis

    13/59

    2006 2007 2008 2009 2010 2011 2012

    17,322,307 19,279,728 21,458,337 23,883,129 26,581,923 29,585,680 32,928,862

    11.30% 11.30% 11.30% 11.30% 11.30% 11.30% 11.30%

    10,700,226 11,913,367 13,312,716 14,793,182 16,414,882 18,256,411 20,117,466

    61.77% 61.79% 62.04% 61.94% 61.75% 61.71% 61.09%

    6,622,082 7,366,361 8,145,621 9,089,947 10,167,040 11,329,269 12,811,395

    38.23% 38.21% 37.96% 38.06% 38.25% 38.29% 38.91%

    1,800,192 2,003,613 2,230,021 2,482,014 2,762,481 3,074,642 3,422,076

    10.39% 10.39% 10.39% 10.39% 10.39% 10.39% 10.39%

    0 0 0 0 0 0 0

    614,415 680,141 753,293 834,712 925,331 1,026,191 1,138,447

    6.41% 6.41% 6.41% 6.41% 6.41% 6.41% 6.41%

    4,207,475 4,682,607 5,162,306 5,773,221 6,479,228 7,228,437 8,250,872

    24.29% 24.29% 24.06% 24.17% 24.37% 24.43% 25.06%

    351,704 391,447 435,681 484,912 539,708 600,694 668,5732.03% 2.03% 2.03% 2.03% 2.03% 2.03% 2.03%

    873,529 967,250 1,071,562 1,187,661 1,316,879 1,460,699 1,620,770

    13.68% 13.68% 13.68% 13.68% 13.68% 13.68% 13.68%

    238,345 265,278 295,255 328,619 365,753 407,083 453,083

    13.24% 13.24% 13.24% 13.24% 13.24% 13.24% 13.24%

    3,447,305 3,841,526 4,231,170 4,741,854 5,336,304 5,961,350 6,845,592

    1,206,557 1,344,534 1,480,910 1,659,649 1,867,706 2,086,472 2,395,957

    35% 35% 35% 35% 35% 35% 35%

    2,240,749 2,496,992 2,750,261 3,082,205 3,468,597 3,874,877 4,449,635

    12.94% 12.95% 12.82% 12.91% 13.05% 13.10% 13.51%

    866,778 1,035,962 1,177,787 1,309,500 1,464,070 1,644,412 1,839,9753,107,527 3,532,953 3,928,048 4,391,705 4,932,668 5,519,289 6,289,610

    2,071,565 2,355,167 2,618,548 2,927,635 3,288,256 3,679,314 4,192,832

    66.7% 66.7% 66.7% 66.7% 66.7% 66.7% 66.7%

    0 0 0 0 0 0 0

    0 0 0 0 0 0 0

    1,035,962 1,177,787 1,309,500 1,464,070 1,644,412 1,839,975 2,096,778

    152,940 152,940 152,940 152,940 152,940 152,940 152,940

    14.65 16.33 17.98 20.15 22.68 25.34 29.09

    13.54 15.40 17.12 19.14 21.50 24.06 27.41

  • 7/27/2019 Engro Equity Analysis

    14/59

    2013 2014

    36,649,823 40,791,253

    11.30% 11.30%

    22,341,585 24,716,244

    60.96% 60.59%

    14,308,238 16,075,010

    39.04% 39.41%

    3,808,771 4,239,162

    10.39% 10.39%

    0 0

    1,263,388 1,402,447

    6.41% 6.41%

    9,236,079 10,433,400

    25.20% 25.58%

    744,122 828,2072.03% 2.03%

    1,798,930 1,997,222

    13.68% 13.68%

    504,281 561,265

    13.24% 13.24%

    7,676,989 8,703,121

    2,686,946 3,046,092

    35% 35%

    4,990,043 5,657,029

    13.62% 13.87%

    2,096,778 2,362,5467,086,821 8,019,574

    4,724,275 5,346,075

    66.7% 66.7%

    0 0

    0 0

    2,362,546 2,673,499

    152,940 152,940

    32.63 36.99

    30.89 34.96

  • 7/27/2019 Engro Equity Analysis

    15/59

    Engro Chemicals Pakistan Limited

    Cash Flow Statement

    Rupees in 000's 1,993 1,994 1,995

    CASH FLOW FROM OPERATING ACTIVITIES

    Prof i t before taxat ion469,648 733,326 993,373Depreciat ion 71,369 199,261 213,455

    Taxes paid (71,951) (241,044) (197,916)

    Provis ions & Others (118,603) 75,588 (66,506)

    Change in working capital 59,561 (296,388) (187,372)

    Net cash inf low from operat ing act iv i t ies 410,024 470,743 755,034

    CASH FLOW FROM INVESTING A CTIVITIES

    Net capital expenditure (706,209) (280,372) (386,772)

    Income on deposits /bond s 18,784 28,960 84,328

    Long term inves tments 1,476 (51,278) 51,278

    Net cash (out f low) f rom inv est ing act iv i t ies (685,949) (302,690) (251,166)

    CASH FLOW FROM FINANCING ACTIVITIES

    Issue of share capital + share premium 0 524,160 0

    Net proceeds/(repayments) of lon g-term loans 475,690 (22,885) (237,476)

    Dividends paid (66,281) (146,347) (283,549)

    Tax paid on bouns sh ares issued 0 0 0

    Net cash inf low/(out f low) f rom f inancin g act iv i t ies 409,409 354,928 (521,025)

    Net increase/(decrease) in cash & cash equ ivalents 133,484 522,981 (17,157)

  • 7/27/2019 Engro Equity Analysis

    16/59

    1,996 1,997 1,998 1,999 2,000 2,001 2,002

    1,645,098 1,336,624 1,807,054 1,341,821 1,349,857 1,191,261 1,835,725226,276 255,949 307,976 432,016 466,649 468,446 530,958

    (219,837) (220,901) (251,884) (102,325) (273,630) (199,488) (288,632)

    (57,735) 82,513 (223,244) (276,348) (163,326) (166,928) (246,048)

    69,340 (315,699) (667,039) 661,983 274,291 30,196 (32,046)

    1,663,142 1,138,486 972,863 2,057,147 1,653,841 1,323,487 1,799,957

    (488,914) (1,913,267) (1,428,961) (331,609) (563,478) (425,167) (816,286)

    105,957 67,937 55,181 67,875 60,110 47,379 32,815

    (455,000) (231,814) (531,000) (171,500) 0 45,000 292,500

    (837,957) (2,077,144) (1,904,780) (435,234) (503,368) (332,788) (490,971)

    0 0 0 0 0 0 0

    (69,062) 1,456,501 546,724 (186,408) (6,372) (120,366) 450,373

    (449,274) (527,238) (607,212) (998,082) (750,354) (909,975) (983,149)

    (11,681) 0 (17,522) 0 0 0 0

    (530,017) 929,263 (78,010) (1,184,490) (756,726) (1,030,341) (532,776)

    295,168 (9,395) (1,009,927) 437,423 393,747 (39,642) 776,210

  • 7/27/2019 Engro Equity Analysis

    17/59

    2003 2004 2005 2006 2007 2008 2009

    2,323,251 2,767,968 3,074,780 3,447,305 3,841,526 4,231,170 4,741,854520,260 502,305 555,363 614,415 680,141 753,293 834,712

    (450,239) (968,789) (1,076,173) (1,206,557) (1,344,534) (1,480,910) (1,659,649)

    (355,888) 0 0 0 0 0 0

    (190,856) 864,049 139,075 154,790 172,282 191,750 213,417

    1,846,528 3,165,534 2,693,045 3,009,954 3,349,414 3,695,304 4,130,334

    (411,631) (744,017) (828,091) (921,665) (1,025,813) (1,141,730) (1,270,746)

    367,857 283,914 315,997 351,704 391,447 435,681 484,912

    (84,557) 0 0 0 0 0 0

    (128,331) (460,102) (512,094) (569,961) (634,366) (706,050) (785,833)

    0 0 0 0 0 0 0

    (148,875) 622,109 553,047 615,541 685,097 762,513 848,677

    (1,258,875) (1,202,650) (1,733,257) (2,071,565) (2,355,167) (2,618,548) (2,927,635)

    0 0 0 0 0 0 0

    (1,407,750) (580,541) (1,180,211) (1,456,024) (1,670,069) (1,856,034) (2,078,957)

    310,447 2,124,890 1,000,740 983,969 1,044,979 1,133,220 1,265,544

  • 7/27/2019 Engro Equity Analysis

    18/59

    2010 2011 2012 2013 2014

    5,336,304 5,961,350 6,845,592 7,676,989 8,703,121925,331 1,026,191 1,138,447 1,263,388 1,402,447

    (1,867,706) (2,086,472) (2,395,957) (2,686,946) (3,046,092)

    0 0 0 0 0

    237,534 264,375 294,249 327,499 364,507

    4,631,462 5,165,443 5,882,331 6,580,930 7,423,983

    (1,414,340) (1,574,160) (1,752,040) (1,950,021) (2,170,373)

    539,708 600,694 668,573 744,122 828,207

    0 0 0 0 0

    (874,632) (973,466) (1,083,467) (1,205,899) (1,342,166)

    0 0 0 0 0

    944,578 1,051,315 1,170,114 1,302,336 1,449,501

    (3,288,256) (3,679,314) (4,192,832) (4,724,275) (5,346,075)

    0 0 0 0 0

    (2,343,678) (2,627,999) (3,022,718) (3,421,939) (3,896,574)

    1,413,152 1,563,978 1,776,145 1,953,092 2,185,242

  • 7/27/2019 Engro Equity Analysis

    19/59

    Engro Chemic al Pakistan Lim ited

    Rat io Analys is

    1983 1984 1985

    Prof i tabi l i ty Rat ios

    Gross Margin 40.20% 36.15% 38.67%

    Operat ing Margin 17.71% 16.76% 19.93%

    Net Margin 8.26% 9.42% 12.18%

    Liquid i ty Rat ios

    Current Rat io 0.96 1.05 1.19

    Quick Acid Rat io 0.84 0.98 1.09

    Net Working Capital (6,683) 8,964 30,099

    Net working Capital to Asset (0.04) 0.05 0.16

    Cash rat io 0.11 0.24 0.54

    Act iv i ty Rat ios

    Inventory Turnover 31.32 53.85 45.76

    Inventory Days 11.50 6.69 7.87Receivables Turno ver 60.49 9.68 31.87

    Average Col lect ion Per iod 5.95 37.20 11.30

    Payables Turnover 6.39 5.36 6.47

    Average Payable Per iod 56.34 67.21 55.62

    Operat ing Cycle 17.45 43.88 19.16

    Net Operating Cycle (38.89) (23.32) (36.46)

    Prof i tabi l i ty Rat ios

    Return on Assets(ROA) 21.25% 22.36% 30.47%

    Return on Investment(ROI) 50.56% 55.58% 65.61%

    Return on Equity(ROE) 46.84% 53.72% 62.22%

    Return on Equi t y wi th Dupont

    Operat ing Margin 17.71% 16.76% 19.93%

    Earnings Retent ion 52.60% 59.24% 63.74%

    Interest Bu rden 0.887 0.949 0.959

    Asset Turnover 2.21 2.17 2.35

    Leverage 2.57 2.63 2.17

    ROE 46.84% 53.72% 62.22%

    Financial Leverage Rat ios

    Short - term + Lo ng-term Debt to Ass ets Rat io 0.61 0.62 0.54

    Long -term Debt to As sets Rat io 0.03 0.02 0.00

    Equity to Lo ng Term Capital rat io 0.93 0.94 0.99

    Long -term Debt to Lo ng Term Capital rat io 0.07 0.06 0.01

    Long -term Debt to Equity rat io 0.08 0.06 0.01

    Interest Coverage Ratio(Times Interest Earned) 13.06 18.76 25.91

    Other Rat ios

    Degree of Operat ing Leverage(DOL) 17.71% 16.76% 19.93%

    Degree of Financ ial Leverage(DFL) 46.65% 56.20% 61.11%

    Plowback Rat io 11.25% 10.69% 26.46%

  • 7/27/2019 Engro Equity Analysis

    20/59

    CAPEX/Sales Ratio

    Earnings per share 5.07 6.16 8.16

    P/E ratio

    Revenue per share 61.36 65.38 66.98

    Interest/revenue 1.36% 0.89% 0.77%

    Interest/expense 6.03% 4.61% 4.11%

    Dividend per Net prof i t 88.75% 89.31% 73.54%Dividend per Share 4.50 5.50 6.00

    Equity per share 10.83 11.46 13.11

    LT Debt/sales 1.38% 1.02% 0.16%

    P/CF

    P/BV

    P/S

  • 7/27/2019 Engro Equity Analysis

    21/59

    1986 1987 1988 1989 1990 1991 1992

    43.41% 35.86% 34.12% 37.30% 25.42% 36.09% 31.32%

    30.65% 24.98% 22.61% 26.77% 16.71% 27.29% 22.84%

    15.04% 16.63% 13.23% 15.14% 10.52% 14.70% 12.78%

    1.30 1.45 1.26 1.22 1.05 1.04 1.21

    1.22 1.27 1.22 1.18 0.97 0.84 1.19

    74,890 108,637 77,767 87,603 24,345 17,026 92,708

    0.23 0.31 0.21 0.18 0.04 0.04 0.18

    0.54 0.37 0.38 0.52 0.46 0.52 0.84

    38.08 19.29 58.92 60.65 31.97 16.88 201.08

    9.45 18.66 6.11 5.94 11.26 21.33 1.7922.45 22.29 21.43 24.53 30.33 38.40 41.47

    16.03 16.15 16.80 14.67 11.87 9.38 8.68

    4.74 5.28 3.69 3.47 3.13 5.29 7.38

    75.95 68.14 97.61 103.65 115.07 67.99 48.77

    25.49 34.81 22.91 20.61 23.13 30.70 10.47

    (50.46) (33.33) (74.70) (83.04) (91.94) (37.29) (38.30)

    27.46% 28.44% 20.30% 23.27% 16.64% 12.65% 7.76%

    61.64% 55.68% 43.32% 55.42% 43.86% 16.62% 8.95%

    62.26% 59.15% 45.69% 55.25% 52.43% 54.59% 23.27%

    30.65% 24.98% 22.61% 26.77% 16.71% 27.29% 22.84%

    51.55% 63.19% 56.38% 58.07% 58.55% 57.78% 57.70%

    0.952 1.053 1.038 0.974 1.075 0.932 0.970

    1.70 1.69 1.45 1.39 1.53 0.79 0.58

    2.43 2.11 2.38 2.62 3.25 4.73 3.15

    62.26% 59.15% 45.69% 55.25% 52.43% 54.59% 23.27%

    0.59 0.53 0.58 0.62 0.69 0.79 0.68

    0.03 0.04 0.05 0.04 0.07 0.55 0.55

    0.92 0.93 0.90 0.91 0.81 0.28 0.37

    0.08 0.07 0.10 0.09 0.19 0.72 0.63

    0.08 0.08 0.11 0.10 0.23 2.60 1.73

    28.15 118.96 29.89 17.12 49.40 19.40 35.93

    30.65% 24.98% 22.61% 26.77% 16.71% 27.29% 22.84%

    49.07% 66.57% 58.53% 56.56% 62.94% 53.85% 55.97%

    40.42% 36.42% 2.21% 15.51% -0.37% 70.30% 68.75%

  • 7/27/2019 Engro Equity Analysis

    22/59

    10.91 11.01 7.16 9.47 8.97 15.15 6.36

    72.53 66.21 54.09 62.54 85.25 103.07 49.73

    1.09% 0.21% 0.76% 1.56% 0.34% 1.41% 0.64%

    8.53% 1.93% 6.58% 14.85% 3.89% 15.99% 7.49%

    59.58% 63.58% 97.79% 84.49% 100.37% 29.70% 31.25%6.50 7.00 7.00 8.00 9.00 4.50 1.99

    17.52 18.61 15.67 17.14 17.10 27.75 27.32

    2.01% 2.13% 3.33% 2.74% 4.69% 69.97% 94.97%

  • 7/27/2019 Engro Equity Analysis

    23/59

    1993 1994 1995 1996 1997 1998 1999

    34.41% 47.23% 44.25% 38.66% 41.55% 42.10% 43.82%

    23.45% 30.86% 28.81% 26.82% 25.84% 26.66% 22.95%

    11.84% 16.85% 17.32% 19.34% 18.05% 17.79% 12.14%

    1.26 1.45 1.29 1.38 1.42 1.20 1.10

    1.17 1.34 1.21 1.30 1.33 1.01 0.97

    156,967 497,079 432,583 650,684 756,369 468,595 255,705

    0.21 0.31 0.23 0.28 0.30 0.17 0.09

    0.83 0.92 0.70 0.76 0.75 0.30 0.22

    44.96 29.19 36.25 55.15 38.43 18.92 25.07

    8.01 12.33 9.93 6.53 9.37 19.03 14.3630.70 27.88 15.59 15.06 12.70 19.84 27.20

    11.73 12.91 23.09 23.90 28.34 18.14 13.24

    5.43 7.65 7.66 8.63 7.11 7.27 8.08

    66.25 47.07 46.98 41.72 50.60 49.53 44.55

    19.73 25.24 33.02 30.43 37.71 37.17 27.59

    (46.51) (21.83) (13.96) (11.29) (12.89) (12.36) (16.96)

    8.65% 17.71% 19.26% 24.18% 17.46% 17.39% 15.53%

    10.05% 22.40% 25.87% 32.17% 21.78% 22.12% 20.16%

    22.38% 27.82% 30.19% 40.69% 30.42% 32.24% 21.21%

    23.45% 30.86% 28.81% 26.82% 25.84% 26.66% 22.95%

    58.61% 81.97% 78.80% 84.25% 89.94% 82.36% 78.07%

    0.861 0.666 0.763 0.856 0.777 0.810 0.678

    0.54 0.67 0.78 1.04 0.74 0.77 0.78

    3.51 2.45 2.22 2.03 2.28 2.36 2.24

    22.38% 27.82% 30.19% 40.69% 30.42% 32.24% 21.21%

    0.71 0.59 0.55 0.51 0.56 0.58 0.55

    0.58 0.38 0.29 0.26 0.36 0.36 0.33

    0.33 0.52 0.60 0.66 0.55 0.54 0.58

    0.67 0.48 0.40 0.34 0.45 0.46 0.42

    2.02 0.94 0.65 0.52 0.83 0.85 0.73

    5.57 3.26 3.99 6.76 4.66 5.51 2.94

    23.45% 30.86% 28.81% 26.82% 25.84% 26.66% 22.95%

    50.49% 54.60% 60.10% 72.09% 69.86% 66.74% 52.91%

    72.80% 67.61% 55.23% 59.55% 45.35% 45.84% 1.00%

  • 7/27/2019 Engro Equity Analysis

    24/59

    0.30 0.08 0.09 0.07 0.29 0.17 0.04

    7.35 12.35 13.40 19.78 13.72 12.31 8.66

    10.28

    62.09 73.30 77.39 102.27 76.01 69.19 71.37

    4.21% 9.47% 7.22% 3.97% 5.54% 4.84% 7.82%

    38.43% 57.87% 46.75% 33.53% 35.28% 31.33% 37.46%

    27.20% 32.39% 44.77% 40.45% 54.65% 54.16% 69.25%2.00 4.00 6.00 8.00 7.50 6.67 6.00

    32.85 44.39 44.40 48.61 45.11 38.18 40.85

    106.76% 56.93% 37.47% 24.92% 49.02% 47.09% 41.77%

    0.000203683

    1.80408E-05

    1.03259E-05

  • 7/27/2019 Engro Equity Analysis

    25/59

    2000 2001 2002 2003 2004 2005 2006

    40.33% 38.83% 37.27% 35.83% 38.23% 38.13% 38.23%

    22.80% 21.12% 21.36% 20.82% 24.24% 24.17% 24.29%

    13.42% 12.94% 10.40% 12.79% 12.87% 12.84% 12.94%

    1.27 1.23 1.17 1.44 1.38 1.30 1.23

    1.12 1.10 1.01 1.31 1.28 1.21 1.15

    659,375 751,668 804,256 1,295,342 1,769,963 1,760,269 1,623,328

    0.21 0.19 0.15 0.31 0.27 0.23 0.19

    0.21 0.30 0.47 0.56 0.80 0.82 0.81

    22.76 19.35 14.13 31.57 30.53 30.53 30.53

    15.82 18.61 25.48 11.40 11.79 11.79 11.7918.12 12.03 17.21 17.51 23.51 23.51 23.51

    19.87 29.94 20.92 20.56 15.32 15.32 15.32

    6.01 4.98 5.20 9.35 6.12 6.12 6.12

    59.89 72.29 69.27 38.49 58.79 58.79 58.79

    35.68 48.54 46.40 31.96 27.11 27.11 27.11

    (24.21) (23.74) (22.86) (6.53) (31.69) (31.69) (31.69)

    15.65% 13.76% 11.96% 14.99% 15.85% 15.66% 15.70%

    19.85% 18.66% 17.65% 19.41% 22.53% 23.29% 24.41%

    21.58% 20.31% 21.26% 27.49% 28.74% 30.63% 33.47%

    22.80% 21.12% 21.36% 20.82% 24.24% 24.17% 24.29%

    83.44% 89.32% 61.73% 67.01% 65.00% 65.00% 65.00%

    0.705 0.686 0.789 0.917 0.816 0.817 0.819

    0.73 0.66 0.76 0.95 0.88 0.87 0.87

    2.22 2.37 2.68 2.27 2.53 2.73 2.96

    21.58% 20.31% 21.26% 27.49% 28.74% 30.63% 33.47%

    0.55 0.58 0.63 0.56 0.61 0.63 0.66

    0.34 0.32 0.30 0.33 0.31 0.31 0.31

    0.57 0.57 0.55 0.57 0.56 0.55 0.52

    0.43 0.43 0.45 0.43 0.44 0.45 0.48

    0.75 0.75 0.82 0.75 0.78 0.83 0.91

    2.80 2.69 4.04 6.82 4.75 4.77 4.82

    22.80% 21.12% 21.36% 20.82% 24.24% 24.17% 24.29%

    58.86% 61.29% 48.69% 61.43% 53.07% 53.12% 53.26%

    24.86% 2.00% 7.98% 21.41% 33.34% 33.34% 33.34%

  • 7/27/2019 Engro Equity Analysis

    26/59

    0.07 0.05 0.07 0.03 0.05 0.05 0.05

    8.10 7.65 7.41 10.18 11.76 13.07 14.65

    137.33 0.00 0.01 0.00

    60.37 59.12 71.23 79.59 91.43 101.76 113.26

    8.14% 7.86% 5.28% 3.05% 5.10% 5.07% 5.04%

    44.35% 44.36% 33.02% 20.35% 36.49% 36.33% 36.18%

    75.14% 98.00% 92.02% 78.59% 66.84% 86.72% 92.45%6.09 7.50 6.82 8.00 7.86 11.33 13.54

    37.53 37.69 34.85 37.03 40.93 42.67 43.77

    46.43% 47.75% 39.93% 35.09% 35.00% 35.00% 35.00%

    0.000188393 (0.001488846) 0.000083627 0.000277127 0.000046057

    1.42144E-05 1.12638E-05 1.21781E-05 1.51907E-05 1.56335E-05

    8.83729E-06 7.18001E-06 5.95893E-06 7.06755E-06 6.99873E-06

  • 7/27/2019 Engro Equity Analysis

    27/59

    2007 2008 2009 2010 2011 2012 2013

    38.21% 37.96% 38.06% 38.25% 38.29% 38.91% 39.04%

    24.29% 24.06% 24.17% 24.37% 24.43% 25.06% 25.20%

    12.95% 12.82% 12.91% 13.05% 13.10% 13.51% 13.62%

    1.17 1.12 1.08 1.05 1.02 1.00 0.98

    1.09 1.05 1.01 0.98 0.96 0.94 0.92

    1,424,438 1,176,934 909,436 620,016 292,733 (32,390) (414,307)

    0.14 0.11 0.07 0.04 0.02 (0.00) (0.02)

    0.80 0.79 0.78 0.78 0.77 0.77 0.77

    30.53 30.53 30.53 30.53 30.53 30.53 30.53

    11.79 11.79 11.79 11.79 11.79 11.79 11.7923.51 23.51 23.51 23.51 23.51 23.51 23.51

    15.32 15.32 15.32 15.32 15.32 15.32 15.32

    6.12 6.12 6.12 6.12 6.12 6.12 6.12

    58.79 58.79 58.79 58.79 58.79 58.79 58.79

    27.11 27.11 27.11 27.11 27.11 27.11 27.11

    (31.69) (31.69) (31.69) (31.69) (31.69) (31.69) (31.69)

    15.71% 15.60% 15.69% 15.82% 15.88% 16.24% 16.33%

    25.50% 26.40% 27.58% 28.82% 29.89% 31.48% 32.56%

    36.52% 39.47% 43.27% 47.50% 51.67% 57.37% 62.21%

    24.29% 24.06% 24.17% 24.37% 24.43% 25.06% 25.20%

    65.00% 65.00% 65.00% 65.00% 65.00% 65.00% 65.00%

    0.820 0.820 0.821 0.824 0.825 0.830 0.831

    0.87 0.88 0.88 0.88 0.88 0.88 0.88

    3.23 3.52 3.82 4.14 4.48 4.82 5.18

    36.52% 39.47% 43.27% 47.50% 51.67% 57.37% 62.21%

    0.69 0.72 0.74 0.76 0.78 0.79 0.81

    0.31 0.31 0.31 0.31 0.31 0.31 0.31

    0.50 0.48 0.46 0.44 0.42 0.40 0.38

    0.50 0.52 0.54 0.56 0.58 0.60 0.62

    0.99 1.08 1.17 1.27 1.38 1.49 1.60

    4.84 4.82 4.86 4.92 4.95 5.09 5.13

    24.29% 24.06% 24.17% 24.37% 24.43% 25.06% 25.20%

    53.32% 53.28% 53.39% 53.53% 53.61% 53.93% 54.03%

    33.34% 33.34% 33.34% 33.34% 33.34% 33.34% 33.34%

  • 7/27/2019 Engro Equity Analysis

    28/59

    0.05 0.05 0.05 0.05 0.05 0.05 0.05

    16.33 17.98 20.15 22.68 25.34 29.09 32.63

    126.06 140.31 156.16 173.81 193.45 215.31 239.64

    5.02% 4.99% 4.97% 4.95% 4.94% 4.92% 4.91%

    36.04% 35.92% 35.81% 35.71% 35.62% 35.54% 35.47%

    94.32% 95.21% 94.99% 94.80% 94.95% 94.23% 94.67%15.40 17.12 19.14 21.50 24.06 27.41 30.89

    44.70 45.56 46.57 47.75 49.03 50.71 52.45

    35.00% 35.00% 35.00% 35.00% 35.00% 35.00% 35.00%

  • 7/27/2019 Engro Equity Analysis

    29/59

    2014

    39.41%

    25.58%

    13.87%

    0.97

    0.91

    (824,226)

    (0.04)

    0.77

    30.53

    11.7923.51

    15.32

    6.12

    58.79

    27.11

    (31.69)

    16.55%

    33.85%

    67.89%

    25.58%

    65.00%

    0.834

    0.88

    5.55

    67.89%

    0.82

    0.31

    0.37

    0.63

    1.71

    5.22

    25.58%

    54.22%

    33.34%

  • 7/27/2019 Engro Equity Analysis

    30/59

    0.05

    36.99

    266.71

    4.90%

    35.40%

    94.50%34.96

    54.48

    35.00%

  • 7/27/2019 Engro Equity Analysis

    31/59

    2004 2005 2006 2007

    GDP (in billions) 3,641.40 3,859.88 4,091.48 4,336.97

    GDP growth rate 6% 6% 6% 6%

    agricultural contribution rate 24% 24% 24% 24%

    agriculture contribution to GDP 873.936 926.37 981.95 1,040.87

    Agriculture growth rate 6% 6% 6% 6%

    Fertilizer consumption in Pakistan

    Urea consumption in tonnes (000's) 4,500 4,770 5,056 5,360

    Urea consumption growth rate 6% 6% 6% 6%

    price of urea per ton 7528 7,904 8,300 8,715

    inflation 5% 5% 5% 5%

    Sales from Urea (000's) 33,876,000 37,703,988 41,964,539 46,706,532

    Engro Urea Market Share 21% 21% 21% 21%

    Engro Urea Sales (000's) 7,113,960 7,917,837 8,812,553 9,808,372

    DAP consumption in tonnes (000's) 1,200 1,272 1,348 1,429

    DAP consumption growth rate 6% 6% 6% 6%price of DAP per ton 18,085 18,989 19,939 20,936

    inflation 5% 5% 5% 5%

    Sales from DAP (000's) 21,702,000 24,154,326 26,883,765 29,921,630

    Engro DAP Market Share 27% 27% 27% 27%

    Engro DAP Sales (000's) 5,859,540 6,521,668 7,258,617 8,078,840

    Engro NPK production in tonnes (000's) 86 91 97 102

    Engro NPK production growth rate 6% 6% 6% 6%

    Engro NPK price (per ton) 11,686 12,270 12,884 13,528

    inflation 5% 5% 5% 5%

    Engro NPK Sales (000's) 1,004,996 1,118,561 1,244,958 1,385,638

    seed consumption in tonnes (000's) 0.5 0.53 0.56 0.60

    seed consumption growth rate 6% 6% 6% 6%

    price of seeds per ton 249,425 261,896 274,991 288,741

    inflation 5% 5% 5% 5%

    Sales from seeds (000's) 124,713 138,805 154,490 171,947

    Engro Seed market share 4% 4% 4% 4%

    Engro seed sales (000's) 4,989 5,552 6,180 6,878

    Total Engro Sales (000's) 13,983,485 15,563,618 17,322,307 19,279,728

  • 7/27/2019 Engro Equity Analysis

    32/59

    2008 2009 2010 2011 2012 2013 2014

    4,597.18 4,873.01 5,165.40 5,475.32 5,803.84 6,152.07 6,521.19

    6% 6% 6% 6% 6% 6% 6%

    24% 24% 24% 24% 24% 24% 24%

    1,103.32 1,169.52 1,239.69 1,314.08 1,392.92 1,476.50 1,565.09

    6% 6% 6% 6% 6% 6% 6%

    5,681 6,022 6,383 6,766 7,172 7,603 8,059

    6% 6% 6% 6% 6% 6% 6%

    9,150 9,608 10,088 10,593 11,122 11,678 12,262

    5% 5% 5% 5% 5% 5% 5%

    51,984,370 57,858,603 64,396,626 71,673,444 79,772,543 88,786,841 98,819,754

    21% 21% 21% 21% 21% 21% 21%

    10,916,718 12,150,307 13,523,291 15,051,423 16,752,234 18,645,237 20,752,148

    1,515 1,606 1,702 1,804 1,913 2,027 2,149

    6% 6% 6% 6% 6% 6% 6%21,982 23,082 24,236 25,447 26,720 28,056 29,459

    5% 5% 5% 5% 5% 5% 5%

    33,302,774 37,065,988 41,254,445 45,916,197 51,104,727 56,879,561 63,306,952

    27% 27% 27% 27% 27% 27% 27%

    8,991,749 10,007,817 11,138,700 12,397,373 13,798,276 15,357,482 17,092,877

    109 115 122 129 137 145 154

    6% 6% 6% 6% 6% 6% 6%

    14,204 14,915 15,660 16,443 17,266 18,129 19,035

    5% 5% 5% 5% 5% 5% 5%

    1,542,215 1,716,486 1,910,448 2,126,329 2,366,604 2,634,031 2,931,676

    0.63 0.67 0.71 0.75 0.80 0.84 0.90

    6% 6% 6% 6% 6% 6% 6%

    303,178 318,337 334,253 350,966 368,514 386,940 406,287

    5% 5% 5% 5% 5% 5% 5%

    191,377 213,003 237,072 263,862 293,678 326,864 363,799

    4% 4% 4% 4% 4% 4% 4%

    7,655 8,520 9,483 10,554 11,747 13,075 14,552

    21,458,337 23,883,129 26,581,923 29,585,680 32,928,862 36,649,823 40,791,253

  • 7/27/2019 Engro Equity Analysis

    33/59

    Date Engro Chemical KSE-100 % Change in KSE-100 % Change in Share price

    2005

    Feb 1 122.95 6,869.28 10.43% -3.95%

    Jan 3 128 6,220.28 11.87% 14.90%

    2004 Dec 1 111.4 5,560.50 5.98% 14.20%

    Nov 1 97.55 5,246.91 0.02% 7.20%

    Oct 1 91 5,245.82 -1.40% -4.41%Sept 1 95.2 5,320.38 2.18% 1.55%

    Aug 2 93.75 5,206.83 -2.63% -5.02%

    Jul 2 98.7 5,347.72 -1.94% 1.18%

    Jun 1 97.55 5,453.57 -1.31% -2.74%

    May 4 100.3 5,525.69 7.48% -2.53%

    Apr 1 102.9 5,141.08 5.92% 7.64%

    Mar 3 95.6 4,853.83 -0.71% -1.39%

    Feb 6 96.95 4,888.45 9.29% 3.69%

    Jan 1 93.5 4,473.02 4.93% 5.35%

    2003 Dec 1 88.75 4,263.06 12.38% 9.23%

    Nov 11 81.25 3,793.56 -6.74% -2.40%

    Oct 2 83.25 4,067.82 -10.07% -14.00%Sept 2 96.8 4,523.52 12.54% 4.20%

    Aug 1 92.9 4,019.52 17.10% 8.28%

    Jul 1 85.8 3,432.55 10.59% 5.41%

    Jun 2 81.4 3,103.90 6.13% 2.58%

    May 2 79.35 2,924.57 8.07% 0.44%

    Apr 2 79 2,706.15 7.36% -12.27%

    Mar 3 90.05 2,520.57 1.99% 7.91%

    Feb 3 83.45 2,471.48 -7.31% -7.69%

    Jan 1 90.4 2,666.53 15.63% 23.50%

    2002 Dec 2 73.2 2,306.17 0.50% -2.53%

    Nov 1 75.1 2,294.62 14.42% 19.78%

    Oct 3 62.7 2,005.44 2.71% 1.70%

    Sept 2 61.65 1,952.57 9.49% 4.05%

    Aug 1 59.25 1,783.30 -0.10% -2.39%

    Jul 2 60.7 1,785.14 8.34% 4.21%

    Jun 3 58.25 1,647.68 -13.08% -9.83%

    May 3 64.6 1,895.66 2.64% -10.90%

    Apr 3 72.5 1,846.84 4.08% -2.03%

    Mar 1 74 1,774.51 6.20% 17.46%

    Feb 1 63 1,670.89 26.39% 16.67%

    Jan 1 54 1,322.06 -2.44% -2.26%

    2001 Dec 4 55.25 1,355.06 -1.65% -1.95%

    Nov 1 56.35 1,377.86 25.64% 29.10%

    Oct 1 43.65 1,096.70 -12.23% -18.18%

    Sept 5 53.35 1,249.56 0.16% 5.54%Aug 3 50.55 1,247.51 -6.52% -7.33%

    Jul 4 54.55 1,334.48 -3.43% -5.13%

    Jun 1 57.5 1,381.83 0.28% -8.73%

    May 4 63 1,378.01 2.99% 8.71%

    Apr 6 57.95 1,338.01 -6.15% -8.67%

    Mar 1 63.45 1,425.76 -2.22% -21.57%

    Feb 1 80.9 1,458.09 -3.94% 12.75%

    Jan 1 71.75 1,517.94 18.51% 32.38%

  • 7/27/2019 Engro Equity Analysis

    34/59

    2000 Dec 2 54.2 1,280.80 -13.84% -3.64%

    Nov 2 56.25 1,486.48 -6.07% 2.09%

    Oct 2 55.1 1,582.54 4.50% 3.67%

    Sept 1 53.15 1,514.38 -3.36% 2.51%

    Aug 1 51.85 1,566.96 3.11% -12.12%

    Jul 3 59 1,519.63 4.98% -3.99%

    Jun 2 61.45 1,447.56 -24.64% -24.83%May 2 81.75 1,920.88 -3.84% -7.31%

    Apr 3 88.2 1,997.69 6.57% -8.13%

    Mar 1 96 1,874.48 6.49% -9.43%

    Feb 1 106 1,760.29 20.81% -16.67%

    Jan 3 127.2 1,457.07 16.08% 11.87%

    1999 Dec 1 113.7 1,255.21 4.84% 7.77%

    Nov 1 105.5 1,197.25 -0.07% 27.72%

    Oct 1 82.6 1,198.09 -1.12% 10.21%

    Sept 1 74.95 1,211.70 -4.72% -0.40%

    Aug 2 75.25 1,271.70 19.29% 4.37%

    Jul 1 72.1 1,066.10 -9.65% -3.35%

    Jun 1 74.6 1,179.94 5.43% -14.89%May 3 87.65 1,119.21 5.72% -16.44%

    Apr 1 104.9 1,058.68 13.53% 6.88%

    Mar 1 98.15 932.48 2.74% 11.85%

    Feb 1 87.75 907.59 -4.71% -4.62%

    Jan 2 92 952.41 -10.27% 27.16%

    1998 Dec 1 72.35 1,061.45 23.86% 39.67%

    Nov 2 51.8 857 -22.42% -19.63%

    Oct 1 64.45 1,104.68 13.12% -2.57%

    Sept 1 66.15 976.54 12.88% 8.00%

    Aug 3 61.25 865.13 0.23% 18.93%

    Jul 1 51.5 863.16

    Slope

    -20.0

    -10.0

    0.0

    10.0

    20.0

    30.0

    40.0

    50.0

    -30.00% -20.00% -10.00%

    ChangeinShareP

    rices

    Beta C

  • 7/27/2019 Engro Equity Analysis

    35/59

    -30.0

    Chang

  • 7/27/2019 Engro Equity Analysis

    36/59

    2004 Yearly average share price 97.87

    2003 Yearly average share price 86.03

    2002 Yearly average share price 64.91

    2001 Yearly average share price 59.02

    2000 Yearly average share price 74.18

  • 7/27/2019 Engro Equity Analysis

    37/59

    1999 Yearly average share price 89.10

    1998 Yearly average share price 61.25

    0.675083915

    0%

    0%

    0%

    0%

    0%

    0%

    0%

    0%

    0.00% 10.00% 20.00% 30.00%

    lculation

  • 7/27/2019 Engro Equity Analysis

    38/59

    0%

    in KSE Index

  • 7/27/2019 Engro Equity Analysis

    39/59

    Computation of market risk

    2005 % change in KSE index

    Jan 11.87% average monthly market risk 3.04%

    2004 Dec 5.98%

    Nov 0.02% average yearly market risk 36.50%

    Oct -1.40%Sept 2.18%

    Aug -2.63%

    Jul -1.94%

    Jun -1.31%

    May 7.48%

    Apr 5.92%

    Mar -0.71%

    Feb 9.29%

    Jan 4.93%

    2003 Dec 12.38%

    Nov -6.74%

    Oct -10.07%Sept 12.54%

    Aug 17.10%

    Jul 10.59%

    Jun 6.13%

    May 8.07%

    Apr 7.36%

    Mar 1.99%

    Feb -7.31%

    Jan 15.63%

    2002 Dec 0.50%

    Nov 14.42%

    Oct 2.71%

    Sept 9.49%

    Aug -0.10%

    Jul 8.34%

    Jun -13.08%

    May 2.64%

    Apr 4.08%

    Mar 6.20%

    Feb 26.39%

    Jan -2.44%

    2001 Dec -1.65%

    Nov 25.64%

    Oct -12.23%

    Sept 0.16%Aug -6.52%

    Jul -3.43%

    Jun 0.28%

    May 2.99%

    Apr -6.15%

    Mar -2.22%

    Feb -3.94%

    Jan 18.51%

  • 7/27/2019 Engro Equity Analysis

    40/59

    2000 Dec -13.84%

    Nov -6.07%

    Oct 4.50%

    Sept -3.36%

    Aug 3.11%

    Jul 4.98%

    Jun -24.64%May -3.84%

    Apr 6.57%

    Mar 6.49%

    Feb 20.81%

    Jan 16.08%

    1999 Dec 4.84%

    Nov -0.07%

    Oct -1.12%

    Sept -4.72%

    Aug 19.29%

    Jul -9.65%

    Jun 5.43%May 5.72%

    Apr 13.53%

    Mar 2.74%

    Feb -4.71%

    Jan -10.27%

    1998 Dec 23.86%

    Nov -22.42%

    Oct 13.12%

    Sept 12.88%

    Aug 0.23%

  • 7/27/2019 Engro Equity Analysis

    41/59

    Computation of risk free rate

    2005 Date 6- month

    Feb 2 4.79% average 6-monthly risk free rate 7.46%

    Jan 5 4.16%

    2004 Nov 10 3.73% average yearly risk free rate 14.92%

    Oct 13 3.19%Sept 15 3.01%

    Aug 18 2.62%

    Jul 21 2.52%

    2003 Jun 26 1.66%

    May 28 1.80%

    Apr 2 1.64%

    Mar 6 2.09%

    Feb 6 3.19%

    Jan 9 3.84%

    2002 Dec 12 4.32%

    Nov 14 6.36%

    Oct 17 6.34%Sept 5 6.39%

    Aug 8 6.40%

    Jul 11 6.27%

    Jun 13 6.42%

    May 2 6.38%

    Apr 4 6.48%

    Mar 7 6.47%

    Feb 7 5.65%

    Jan 10 7.77%

    2001Dec 13 8.14%

    Nov 1 8.50%

    Oct 4 10.40%

    Sept 6 10.49%

    Aug 9 11.36%

    Jul 12 12.56%

    2000 Dec 1 10.96%

    Nov 1 10.92%

    Oct 2 11.06%

    Sept 2 8.14%

    Aug 1 7.38%

    Jul 5 7.23%

    Apr 19 7.13%

    Mar 31 8.90%

    1999 Sept 24 9.43%

    Jun 30 13.17%Mar 26 11.35%

    Jan 4 11.94%

  • 7/27/2019 Engro Equity Analysis

    42/59

    0

    5,000,00010,000,00015,000,00020,000,00025,000,00030,000,00035,000,00040,000,000

    45,000,000

    1983

    1984

    1985

    1986

    1987

    1988

    1989

    1990

    1991

    1992

    1993

    1994

    1995

    1996

    1997

    1998

    1999

    2000

    2001

    Sales

    (Rs000)

    Years

    Sales

    0.00

    5.0010.00

    15.00

    20.00

    25.00

    30.00

    35.00

    40.00

    1983

    1984

    1985

    1986

    1987

    1988

    1989

    1990

    1991

    1992

    1993

    1994

    1995

    1996

    1997

    1998

    1999

    2000

    2001

    2002

    2003

    (Rs/Share)

    Years

    Earning Per Share

  • 7/27/2019 Engro Equity Analysis

    43/59

    0.00%

    5.00%

    10.00%

    15.00%

    20.00%

    25.00%

    30.00%

    35.00%

    40.00%

    45.00%

    50.00%

    1983

    1984

    1985

    1986

    1987

    1988

    1989

    1990

    1991

    1992

    1993

    1994

    1995

    1996

    1997

    1998

    1999

    2000

    2001

    2002

    2003

    Ratio

    Years

    Profitability Rati

    (0.20)

    0.00

    0.20

    0.40

    0.60

    0.80

    1.00

    1.20

    1.40

    1.60

    1983

    1984

    1985

    1986

    1987

    1988

    1989

    1990

    1991

    1992

    1993

    1994

    1995

    1996

    1997

    Ratio

    Liquidity

    Current Ratio Quick Aci

  • 7/27/2019 Engro Equity Analysis

    44/59

    0.00%

    10.00%

    20.00%

    30.00%

    40.00%

    50.00%

    60.00%

    70.00%

    80.00%

    1983

    1984

    1985

    1986

    1987

    1988

    1989

    1990

    1991

    1992

    1993

    1994

    1995

    ROA,ROI,ROE(%)

    R

    Return on Assets

    0.00

    0.50

    1.00

    1.50

    2.00

    2.50

    3.00

    1983

    1984

    1985

    1986

    1987

    1988

    1989

    1990

    1991

    1992

    1993

    1994

    1995

    1996

    1997

    Ratios

    Financial Lev

  • 7/27/2019 Engro Equity Analysis

    45/59

    Total Debt to Asset Ratio

    Equity to Long Term Capital Ratio

    Long Term Debt to Equity Ratio

    0.00

    10.00

    20.00

    30.00

    40.00

    50.00

    60.00

    70.00

    80.0090.00

    100.00

    110.00

    120.00

    130.00

    140.00

    150.00

    160.00

    170.00

    180.00

    190.00

    200.00

    Inventory Turnover

    20.00

    40.00

    60.00

    80.00

    100.00

    120.00

    140.00

    NimberofD

    ays

    Activity

  • 7/27/2019 Engro Equity Analysis

    46/59

    .

    1983

    1984

    1985

    1986

    1987

    1988

    1989

    1990

    1991

    1992

    1993

    1994

    1995

    1996

    Inventory Days Averag

    (100.00)

    (80.00)

    (60.00)

    (40.00)

    (20.00)

    0.00

    20.00

    40.00

    60.00

    1983

    1984

    1985

    1986

    1987

    1988

    1989

    1990

    1991

    1992

    1993

    1994

    1995

    1996

    1997

    Operating

    Operating Cycle

    1.50

    2.00

    2.50

    Asset Tur

  • 7/27/2019 Engro Equity Analysis

    47/59

    0.00

    0.50

    1.00

    0.00%

    20.00%

    40.00%

    60.00%

    80.00%

    100.00%

    120.00%

    %

    Years

    Operating Margin Earnings Retention

    Asset Turnover Leverage

  • 7/27/2019 Engro Equity Analysis

    48/59

    2003

    2004

    2005

    2006

    2007

    2008

    2009

    2010

    2011

    2012

    2013

    2014

    Sales

    2005

    2006

    2007

    2008

    2009

    2010

    2011

    2012

    2013

    2014

  • 7/27/2019 Engro Equity Analysis

    49/59

    2005

    2006

    2007

    2008

    2009

    2010

    2011

    2012

    2013

    2014

    s

    Gross Margin

    Operating Margin

    Net Margin

    1998

    1999

    2000

    2001

    2002

    2003

    2004

    2005

    2006

    2007

    2008

    2009

    2010

    2011

    2012

    2013

    2014

    Years

    Ratios

    id Ratio Net working Capital to Asset

  • 7/27/2019 Engro Equity Analysis

    50/59

    1997

    1998

    1999

    2000

    2001

    2002

    2003

    2004

    2005

    2006

    2007

    2008

    2009

    2010

    2011

    2012

    2013

    2014

    Years

    turns

    Return on Investment Return on Equity

    1998

    1999

    2000

    2001

    2002

    2003

    2004

    2005

    2006

    2007

    2008

    2009

    2010

    2011

    2012

    2013

    2014

    Years

    erage Ratios

  • 7/27/2019 Engro Equity Analysis

    51/59

    Long Term Debt To Asset Ratio

    Long Term Debt to Long Term Capital Ratio

    Years

    urnover

    Recievables Turnover Payables Turnover

    Ratios

  • 7/27/2019 Engro Equity Analysis

    52/59

    1998

    1999

    2000

    2001

    2002

    2003

    2004

    2005

    2006

    2007

    2008

    2009

    2010

    2011

    2012

    2013

    2014

    Years

    Collection Period Averge Payable Period

    1999

    2000

    2001

    2002

    2003

    2004

    2005

    2006

    2007

    2008

    2009

    2010

    2011

    2012

    2013

    2014

    Years

    ycles

    Net Operating Cycle

    nover

    Asset Turnover

  • 7/27/2019 Engro Equity Analysis

    53/59

    0.00

    1.00

    2.00

    3.00

    4.00

    5.00

    6.00

    ratios

    Interest Burden

    ROE

  • 7/27/2019 Engro Equity Analysis

    54/59

    Engro Chemic al Pakistan Lim ited

    Valuat ion

    Years 2004 2005 2006 2007

    DIVIDEND DISCOUNT MODEL

    sustainable growth rate (g) 5.88%

    beta 0.68 0.68 0.68 0.68

    Market risk premium 21.58% 21.58% 21.58% 21.58%

    risk free rate 3.32% 3.32% 3.32% 3.32%

    required rate of return 17.89% 17.89% 17.89% 17.89%

    dividends paid 1,202,650 1,733,257 2,071,565 2,355,167

    Present value of dividends 1,470,238 1,490,554 1,437,459

    Pv of all dividends at 2004 21,749,965

    total number of shares 152,940 152,940 152,940 152,940

    Price Per Share 142

    FREE CASH FLOW MODEL

    Free cash flow (CFO - CAPEX) 2,421,517 1,864,954 2,088,289 2,323,601

    Free cash flow to firm 2,885,330 2,378,013 2,656,083 2,952,313

    After tax cost of debt(rd) 8.89% 8.89% 8.89% 8.89%

    equity (E) 6,260,069 6,525,418 6,694,602 6,836,427

    total debt (short term and long term) (D) 5,216,855 5,769,901 6,385,442 7,070,540

    D+E 11,476,923 12,295,320 13,080,044 13,906,966

    WACC 13.80% 13.67% 13.50% 13.32%

    Present Value 2,095,219 2,343,980 2,609,713

    Present Value of free Cash flow to firm 72,217,871

    Price of Share 472

    Free Cash Flow to Equity 3,043,625 2,418,001 2,703,830 3,008,698

    Present Value 2,051,073 1,945,488 1,836,337

  • 7/27/2019 Engro Equity Analysis

    55/59

    Present Value of Free Cash Flow to Equity 23,484,454

    Price of Share 154

    Price/Earnings

    average P/E ratio using past data 8.22 8.22 8.22 8.22expected EPS 11.76 13.07 14.65 16.33

    Value 97 107 120 134

    Price/Cash Flow

    average P/CF using past data (0.0001328) (0.0001328) (0.0001328) (0.0001328)

    Price (282) (133) (131) (139)

    Price/Book Value

    average P/BV using past data 1.92 1.92 1.92 1.92

    Price 71 71 71 71

    Price/Sales

    P/S 7.7819E-06 7.7819E-06 7.7819E-06 7.7819E-06

    Price 109 121 135 150

    Present Value of Operating Cash Flow

    Operating Cash Flow 3,165,534 2,693,045 3,009,954 3,349,414

    Present Value 2,369,236 2,336,631 2,313,448

    Present Value of Operating Cash Flow 42,372,089

    Price of Share 277

  • 7/27/2019 Engro Equity Analysis

    56/59

    2008 2009 2010 2011 2012 2013 2014

    0.68 0.68 0.68 0.68 0.68 0.68 0.68

    21.58% 21.58% 21.58% 21.58% 21.58% 21.58% 21.58%

    3.32% 3.32% 3.32% 3.32% 3.32% 3.32% 3.32%

    17.89% 17.89% 17.89% 17.89% 17.89% 17.89% 17.89%

    2,618,548 2,927,635 3,288,256 3,679,314 4,192,832 4,724,275 5,346,075

    1,355,685 1,285,701 1,224,935 1,162,623 1,123,839 1,074,129 1,031,053

    9,093,748

    152,940 152,940 152,940 152,940 152,940 152,940 152,940

    2,553,574 2,859,589 3,217,122 3,591,282 4,130,290 4,630,909 5,253,609

    3,250,089 3,631,568 4,073,094 4,540,737 5,183,791 5,800,214 6,551,803

    8.89% 8.89% 8.89% 8.89% 8.89% 8.89% 8.89%

    6,968,140 7,122,710 7,303,052 7,498,615 7,755,418 8,021,186 8,332,139

    7,833,053 8,681,730 9,626,308 10,677,623 11,847,737 13,150,073 14,599,574

    14,801,193 15,804,440 16,929,360 18,176,238 19,603,155 21,171,259 22,931,713

    13.13% 12.95% 12.77% 12.60% 12.45% 12.30% 12.16%

    2,877,534 3,220,235 3,617,185 4,037,947 4,615,983 5,171,318 6,551,803

    3,316,087 3,708,266 4,161,700 4,642,597 5,300,404 5,933,246 6,703,110

    1,716,818 1,628,523 1,550,309 1,467,010 1,420,711 1,349,006 1,292,773

  • 7/27/2019 Engro Equity Analysis

    57/59

    8.22 8.22 8.22 8.22 8.22 8.22 8.2217.98 20.15 22.68 25.34 29.09 32.63 36.99

    148 166 187 208 239 268 304

    (0.0001328) (0.0001328) (0.0001328) (0.0001328) (0.0001328) (0.0001328) (0.0001328)

    (150) (168) (188) (208) (236) (259) (290)

    1.92 1.92 1.92 1.92 1.92 1.92 1.92

    71 71 71 71 71 71 71

    7.7819E-06 7.7819E-06 7.7819E-06 7.7819E-06 7.7819E-06 7.7819E-06 7.7819E-06

    167 186 207 230 256 285 317

    3,695,304 4,130,334 4,631,462 5,165,443 5,882,331 6,580,930 7,423,983

    2,256,167 2,247,044 2,251,531 2,250,257 2,300,506 2,316,527 2,356,185

  • 7/27/2019 Engro Equity Analysis

    58/59

    Perpetuity value

    5,660,657

    47,151,652

    110,522,196

    35,076,953

    37,469,364

    7,226,405

  • 7/27/2019 Engro Equity Analysis

    59/59

    61,046,313

    19,374,558