PSO quarterly profit surges 274pc to Rs33 billion

Pakistan State Oil Company Ltd reported its unconsolidated profit for the Jan-March quarter amounted to Rs32.6 billion, up 274 per cent from a year ago, a stock notice showed on Thursday.

The result came in higher than the industry's expectations, according to AKD Securities, as a major deviation occurred due to more-than-expected inventory gains of Rs29bn. Another major difference occurred owing to "other income" of Rs11.6bn, it added.

For the first nine months of 202122, net profit of the oil marketing company stood at Rs64.8bn, 255pc higher than the same period of last year. It didn't announce any payout.

Lucky Cement Ltd said on Thursday its quarterly income for January-March on an unconsolidated basis remained Rs5.5bn, down 22.5pc from a year ago, a regulatory filing showed. The result was above market expectations, as per Insight Securities, mainly because of higher-than-expected "other income", due possibly to dividend income from Lucky Motor Company.

Quarterly sales increased 25pc year-on-year. More than 40pc of it was attributable to an increase in retention prices, said the brokerage.

The company also provided an update on its upcoming projects where the expansion at Pezu plant is likely to achieve its commercial operation date in December 2022.

OGDCL profit jumps to Rs43.1bn Oil and Gas Development Company Ltd told investors on Thursday its quarterly profit for January-March clocked in at Rs43.1bn, up 79pc on a year-on-year basis, a shares market notification showed.

The company also announced an interim cash dividend of Re1 per share, taking the nine-month payout to Rs4.75 per share. Quarterly top line increased 36pc to Rs89.1bn, thanks to a 66pc rise in oil prices and 11.8pc devaluation. The effective tax rate clocked in at 33.4pc versus 30.7pc a year ago.

Consolidated income of the Hub Power Company Ltd for the JanuaryMarch quarter amounted to Rs9.46bn, up 7.31pc from a year ago, the company said in a regulatory filing on Thursday.

The company's revenue grew 56.2pc to Rs18.78bn while the operating cost surged 161.1pc over the same period.

The company didn't declare any cash dividend.

The Karachi Inter-Bank Offered Rate (Kibor) on Tuesday reached a 13year high at 14.1 per cent, reflecting the growing pressure for another interest rate hike to counter a number of factors already challenging the current policy rate.

Sources in the financial sector said several factors have collectively made ground for another interest rate hike in the coming days or weeks.

Analysts said the cut-off yields on six-months treasury bills (T-bills) are already 160 basis points ahead of the policy interest rate. In the previous auction, six-month T-bills were sold at 13.85pc. The policy interest rate is 12.25pc after an increase of 250 basis points announced in an emergency meeting of Monetary Policy Committee of the State Bank of Pakistan (SBP) earlier this month.

"There is a possibility that the sixmonth benchmark treasury bills would see an increase 25 to 40 basis points in the auction to be held on Wednesday," said SS Iqbal, a money dealer in the banking market. He said the secondary market sold six-month T-bills with cutoff yield 14.10pc on Tuesday.

The Kibor reached 14.10pc which was the highest level since February 19, 2009.

"If the government needs money and the banks are the only major sources, the banks stand to benefit from it. They will lend the government at higher rates in the next auction," he said.

The International Monetary Fund (IMF) has already barred the SBP from lending loans to the federal government since 2018.

Analysts cited rising inflation, which reached 12.7pc in March, as another major factor in raising interest rates and mitigating the negative effects of higher inflation.

"Inflation will certainly go high when the petroleum prices are increased by the new government," said Samiuallah Tariq, head of research at the Pak-Kuwait Development and Investment Company.

The current inflation rate is 12.7pc, while the interest rate is 12.25pc, indicating that the real interest rate is negative.

Inflation is expected to catch fire after an increase in oil prices. One of the IMF's conditions is to remove the relief on petroleum prices, which was fixed by the previous government till the new budget (June) while relief on electricity is also provided.