ADVICE FOR GENERAL PUBLIC
THE INVESTORS ARE STRONGLY ADVISED IN THEIR OWN INTEREST TO CAREFULLY READ THE CONTENTS OF THIS OFFER
FOR SALE DOCUMENT, ESPECIALLY THE RISK FACTORS GIVEN AT PARAGRAPH 4.3, BEFORE MAKING ANY INVESTMENT
DECISION.
SUBMISSION OF FICTITIOUS AND MULTIPLE APPLICATIONS (MORE THAN ONE APPLICATION BY SAME PERSON) IS
PROHIBITED AND SUCH APPLICATIONS’ MONEY IS LIABLE TO CONFISCATION UNDER SECTION 18A OF THE SECURITIES
AND EXCHANGE ORDINANCE, 1969.
ENGRO POWERGEN QADIRPUR LIMITED
OFFER FOR SALE DOCUMENT
For Offer of 40,475,000 Ordinary Shares (12.5% of the Total Paid Up Capital) at an Offer Price of PKR 30.02/(including premium of PKR 20.02/- per share)
THIS IS NOT A PROSPECTUS BY ENGRO POWERGEN QADIRPUR LIMITED (THE COMPANY) BUT
AN OFFER FOR SALE DOCUMENT BY ENGRO CORPORATION LIMITED AND ENGRO POWERGEN
LIMITED, FOR OFFER FOR SALE OF SHARES OUT OF THEIR SHAREHOLDING IN THE COMPANY.
DATE OF PUBLIC SUBSCRIPTION: From September 22th to 24th, 2014 (BOTH DAYS INCLUSIVE)
DURING BANKING HOURS
FINANCIAL ADVISORS, LEAD MANAGERS AND ARRANGERS
Bank Alfalah Limited
Habib Bank Limited
BANKERS TO OFFER
Allied Bank Limited
Askari Bank Limited
Bank Alfalah Limited
Faysal Bank Limited
Habib Bank Limited
Habib Metropolitan Bank Limited
JS Bank Limited
MCB Bank Limited
NIB Bank Limited
Samba Bank Limited
Silk Bank Limited
United Bank Limited*
*In order to facilitate investors, United Bank Limited (“UBL”) is offering electronic submission of application (e-IPO) to its account holders. UBL
account holders can use UBL Net Banking facility to submit their application online via link www.ubldirect.com/corporate/ebank. Further, please note
that online application can be submitted 24 hours a day during the subscription period which will close at 12:00 midnight on 24th September, 2014.
Underwritten by:
Date of Publication of this Offer for Sale Document: 14th September 2014
For further queries you may contact: Engro Powergen Qadirpur Limited - Mr. Ali Athar; P: +92 (21) 35297501 Ext 4021; E: aliathar@engro.com;
Habib Bank Limited - Mr. Imran Sherani; P: +92 (21) 3243 9400; E: imran.sherani@hbl.com;
Bank Alfalah Limited - Mr. M. Zeeshan; P: +92 (21) 111-777-786 Ext. 2126; E: m.zeeshan@bankalfalah.com
STATEMENT ON OFFEROR’S ABSOLUTE RESPONSIBILITY
The Offerors, having made all reasonable inquiries, accept responsibility for the disclosures made in this
Offer for Sale Document and confirm that:
(i)
this Offer for Sale Document contains all information with regards to the Offerors and the Offer,
which is material in the context of the Offer and nothing has been concealed;
(ii)
the information contained in the Offer for Sale Document is true and correct to the best of our
knowledge and belief;
(iii) the opinions and intentions expressed herein are honestly held; and
(iv)
there are no other facts and information, the omission of which makes this document as a whole or
any part thereof misleading.
For and on behalf of Offerors,
Engro Corporation Limited
Engro Powergen Limited
-sd________________________
Naz Khan
Chief Financial Officer
-sd________________________
Mohammed Saqib
Chief Financial Officer
Page 2 of 72
GLOSSARY OF TECHNICAL TERMS
BAFL
BTU
CDCPL
CDS
CNIC
Commission / SECP
Company / EPQL
COD
CPI
ECL
EPC
EPL
Exchange/KSE
FDI
FED
FSA
FX
GOP
GSA
HBL
HSD
IFC
IPP
ISO
ITO
KIBOR
LIBOR
LM
MMSCFD
MW
MWH
NEPRA
NTDC
NOC
O&M
OFSD
Ordinance
PKR
PPA
Power Purchaser
PPIB
RCOD
RFO
ROE
ROEDC
SCRA
TREC
US
USD
WHT
WPI
Bank Alfalah Limited
British Thermal Unit
The Central Depository Company of Pakistan Limited
Central Depository System
Computerized National Identity Card
Securities and Exchange Commission of Pakistan
Engro Powergen Qadirpur Limited
Commercial Operations Date
Consumer Price Index
Engro Corporation Limited
Engineering, Procurement and Construction
Engro Powergen Limited
Karachi Stock Exchange Limited
Foreign Direct Investment
Federal Excise Duty
Fuel Supply Agreement
Foreign Exchange
Government of Pakistan
Gas Supply Agreement
Habib Bank Limited
High Speed Diesel
International Finance Corporation
Independent Power Producer
International Organization for Standardization
Income Tax Ordinance, 2001
Karachi Interbank Offered Rate
London Interbank Offered Rate
Lead Managers
Million Standard Cubic Feet per Day
Megawatt
Megawatt Hour
National Electric Power Regulatory Authority
National Transmission and Dispatch Company Limited
No Objection Certificate
Operations and Maintenance
Offer for Sale Document
The Companies Ordinance, 1984
Pakistan Rupee(s)
Power Purchase Agreement entered into between the Company and the
NTDC (through its Central Power Purchasing Agency) on behalf of exWAPDA Distribution Companies
NTDC (through its Central Power Purchasing Agency) on behalf of exWAPDA Distribution Companies
Private Power and Infrastructure Board
Required Commercial Operations Date
Residual Fuel Oil
Return on Equity
Return on Equity during Construction
Special Convertible Rupee Account
Trading Right Entitlement Certificate
United States of America
US Dollars
Withholding Tax
Wholesale Price Index
Page 3 of 72
DEFINITIONS
Application Money
The amount of money paid along with application for subscription of
shares which is equivalent to the product of the Offer Price and the
number of shares applied for plus CDC and Stamp duty charges.
Combined Cycle Power Plant
Combined Cycle Power Plant or Combined Cycle Gas Turbine Plant
is a gas turbine generator that generates electricity and heat in the
exhaust that is used to make steam, which in turn drives a steam
turbine to generate additional electricity.
e-IPO Facility
e-IPO Facility is the facility through which investors can make
application for subscription of shares of the Company through
internet. In order to facilitate the investors, the Offerors have
arranged provision of this facility though United Bank Limited
that is among the Bankers to the Offer.
UBL‟s accountholders can use UBL net-banking to submit their
applications
online
via
link
http://www.ubldirect.com/corporate/ebank.
Accountholders of UBL can submit their applications through the
link 24 hours a day during the subscription period which will close at
12:00 midnight on September 24th, 2014.
OFSD
A document containing all the information and disclosures as
required under the Companies Ordinance, 1984 together with
disclosure of the Offer Price, the date of publication of OFSD and,
the date(s) for subscription of shares.
Financial Advisors, Lead
Managers & Arrangers
Habib Bank Limited and Bank Alfalah Limited.
Offeror
Engro Corporation Limited and Engro Powergen Limited.
Offer
Offer for Sale of 40,475,000 Ordinary Shares of EPQL (12.5% of the
Total Paid Up Capital of the Company) at an Offer Price of PKR
30.02/- per share including premium of PKR 20.02/- per share.
Offer Price
The price at which Ordinary Shares of the Company are being
offered. The Offer Price is PKR 30.02/- per share.
Ordinary Shares
Ordinary Shares of Engro Powergen Qadirpur Limited having face
value PKR 10.00/- each unless otherwise specified in the context
thereof.
Page 4 of 72
TABLE OF CONTENTS
Part
Content
Page
1
APPROVALS AND LISTING ON THE STOCK EXCHANGE ........................................... 6
2
SHARE CAPITAL AND RELATED MATTERS ................................................................... 9
3
UNDERWRITING, COMMISSIONS, BROKERAGE AND OTHER EXPENSES.......... 20
4
HISTORY AND PROSPECTS................................................................................................ 22
5
FINANCIAL INFORMATION ............................................................................................... 34
6
MANAGEMENT OF THE COMPANY ................................................................................ 46
7
MISCELLANEOUS INFORMATION .................................................................................. 55
8
APPLICATION AND ALLOTMENT INSTRUCTIONS .................................................... 60
9
SIGNATORIES TO THE OFFER FOR SALE DOCUMENT ............................................ 64
10
MEMORANDUM OF ASSOCIATION ................................................................................. 65
Page 5 of 72
PART 1
1
APPROVALS AND LISTING ON THE STOCK EXCHANGE
1.1. APPROVAL OF THE SECURITIES & EXCHANGE COMMISSION OF PAKISTAN
Approval of the Securities & Exchange Commission of Pakistan (“SECP” or the “Commission”)
as required under Section 62 read with Section 57(1) of the Companies Ordinance, 1984 (the
“Ordinance”) has been obtained by Engro Corporation Limited and Engro Powergen Limited (the
Offerors) for the issue, circulation and publication of this Offer For Sale Document.
DISCLAIMER:
IT MUST BE DISTINCTLY UNDERSTOOD THAT IN GIVING THIS APPROVAL, SECP
DOES NOT TAKE ANY RESPONSIBILITY FOR THE FINANCIAL SOUNDNESS OF
THE COMPANY AND ANY OF ITS SCHEMES STATED HEREIN OR FOR THE
CORRECTNESS OF ANY OF THE STATEMENTS MADE OR OPINIONS EXPRESSED
WITH REGARDS TO THEM BY THE OFFERORS AND/OR THE COMPANY IN THIS
OFFER FOR SALE DOCUMENT.
SECP HAS NOT EVALUATED QUALITY OF THE OFFER AND ITS APPROVAL FOR
ISSUE, CIRCULATION AND PUBLICATION OF THIS OFFER FOR SALE DOCUMENT
SHOULD NOT BE CONSTRUED AS ANY COMMITMENT OF THE SAME. THE
PUBLIC SHOULD CONDUCT THEIR OWN INDEPENDENT DUE DILIGENCE AND
ANALYSIS REGARDING THE QUALITY OF THE OFFER BEFORE SUBSCRIBING.
1.2. CLEARANCE OF THE OFFER FOR SALE DOCUMENT BY THE KARACHI STOCK
EXCHANGE LIMITED
The OFSD has been cleared by the Karachi Stock Exchange Limited (“KSE”) (referred to as the
“Exchange”), in accordance with the requirements of its Listing Regulations.
DISCLAIMER:
•
THE EXCHANGE HAS NOT EVALUATED THE QUALITY OF THE OFFER, AND
ITS CLEARANCE SHOULD NOT BE CONSTRUED AS ANY COMMITMENT OF
THE SAME. THE PUBLIC SHOULD CONDUCT THEIR OWN INDEPENDENT
INVESTIGATION AND ANALYSIS REGARDING THE QUALITY OF THE OFFER
BEFORE SUBSCRIBING.
•
THE PUBLICATION OF THIS DOCUMENT
SOLICITATION BY THE EXCHANGE.
•
THE CONTENTS OF THIS DOCUMENT DO NOT CONSTITUTE AN INVITATION
BY THE EXCHANGE TO INVEST IN SHARES OR SUBSCRIBE FOR ANY
SECURITIES OR OTHER FINANCIAL INSTRUMENT, NOR SHOULD IT OR ANY
PART OF IT FORM THE BASIS OF, OR BE RELIED UPON IN ANY CONNECTION
WITH ANY CONTRACT OR COMMITMENT WHATSOEVER OF THE
EXCHANGE.
•
IT IS CLARIFIED THAT INFORMATION IN THIS OFFER FOR SALE DOCUMENT
SHOULD NOT BE CONSTRUED AS ADVICE ON ANY PARTICULAR MATTER BY
THE EXCHANGE AND MUST NOT BE TREATED AS A SUBSTITUTE FOR
SPECIFIC ADVICE.
Page 6 of 72
DOES
NOT
REPRESENT
•
THE EXCHANGE DISCLAIMS ANY LIABILITY WHATSOEVER FOR ANY LOSS
HOWEVER ARISING FROM OR IN RELIANCE UPON THIS DOCUMENT TO ANY
ONE, ARISING FROM ANY REASON, INCLUDING, BUT NOT LIMITED TO,
INACCURACIES, INCOMPLETENESS AND/OR MISTAKES, FOR DECISIONS
AND/OR ACTIONS TAKEN, BASED ON THIS DOCUMENT.
•
THE EXCHANGE NEITHER TAKES RESPONSIBILITY FOR THE CORRECTNESS
OF CONTENTS OF THIS DOCUMENT NOR THE ABILITY OF THE OFFEROR TO
FULFILL ITS OBLIGATIONS THEREUNDER.
•
ADVICE FROM A SUITABLY QUALIFIED PROFESSIONAL SHOULD ALWAYS BE
SOUGHT BY INVESTORS IN RELATION TO ANY PARTICULAR INVESTMENT.
1.3. FILING OF OFFER FOR SALE DOCUMENT AND OTHER DOCUMENTS WITH THE
REGISTRAR OF COMPANIES
The Company has filed with the Registrar of Companies, Companies Registration Office (“CRO”)
Securities and Exchange Commission of Pakistan, Karachi, as required under Sections 57(3) and
(4) of the Ordinance, a copy of this OFSD signed by the authorized signatories of the Offerors,
together with the following documents attached thereto:
a) Letter dated September 5th, 2014 from the Auditors of the Company, M/s. A.F. Ferguson & Co. –
Chartered Accountants consenting to the publication of their names in the OFSD, which
contains in Part 5 certain statements and reports issued by them as experts (which consent has
not been withdrawn), as required under Section 57(5) of the Companies Ordinance, 1984.
b) Copies of material contracts and agreements mentioned in Part 7 of this OFSD as required
under Section 57(4) of the Ordinance.
c) Written confirmations of the Legal Advisor to this Offer and the Bankers to this Offer,
mentioned in this OFSD consenting to act in their respective capacities, as required under
Section 57(5) of the Companies Ordinance, 1984.
d) Written consents of the Directors, the Chief Executive and the Company Secretary of the
Company who have consented to their respective appointments being made and their having
been named or described as such Directors, Chief Executive and Company Secretary in this
OFSD, as required under Section 57(3) of the Ordinance, read with sub-clause (1) of clause (4)
of Section 1 of Part 1 of the Second Schedule to the Ordinance.
1.4. LISTING ON THE EXCHANGE
Application has been submitted to the Exchange for permission to deal in and for quotation of the
shares of the Company.
In accordance with the Rule Book of KSE, Chapter 11 pertaining to the “Future Trading in
Provisionally Listed Companies”, the Company shall stand listed provisionally for trading and for
the quotation of its shares on the Karachi Stock Exchange from the date of publication of the OFSD
or a date as may be specified by the Exchange.
If for any reason the application for formal listing is not accepted by the Exchange, during and up
to the period as specified under section 72 (1) of the Companies Ordinance, 1984, the Offerors
undertake that a notice to that effect will immediately be published in the press and refund
Page 7 of 72
Application Money to the applicants without surcharge within eight (8) days from the date they
become liable to pay it.
In the event the Offerors are unable to repay the amount within the aforementioned period of eight
(8) days, the directors of the Offerors shall be jointly and severally be liable to repay the money
from the expiry of eighth day together with a surcharge of one and a half percent (1.5%) for every
month or part thereof from the expiry of the eighth day.
Page 8 of 72
PART 2
2
SHARE CAPITAL AND RELATED MATTERS
2.1. SHARE CAPITAL
No. of
shares
AUTHORIZED CAPITAL
330,000,000 Ordinary Shares of PKR 10/- each
Face value
Premium
(PKR)
(PKR)
Total (including
premium)
(PKR)
3,300,000,000
-
3,300,000,000
ISSUED, SUBSCRIBED AND PAID UP SHARE CAPITAL
323,800,000 Issued against Cash
3,238,000,000
323,800,000 Total
3,238,000,000
80,777,000
80,777,000
3,318,777,000
3,318,777,000
The existing issued, subscribed & paid up capital of the Company is held as follows:
SPONSORS
32,000,000 Engro Corporation Limited
320,000,000
271,999,992 Engro Powergen Limited
2,719,999,920
OTHER SHAREHOLDERS
16,000,000 International Finance Corporation(1)
160,000,000
56,511,500
DIRECTORS
1 Mr. Ruhail Mohammed
10
1 Mr. Muhammad Ali
10
1 Mr. Shabbir Hashmi
10
1 Mr. Javed Akbar
10
1 Ms. Aliya Yusuf
10
1 Mr. Vaqar Zakaria
10
1 Mr. Muhammad Aliuddin Ansari
10
1 Mr. Shahid Hamid Pracha
10
Employees under the Employee Share
3,800,000
38,000,000
24,265,500
Option Scheme(2)
323,800,000 Total Paid up Capital
3,238,000,000
80,777,000
320,000,000
2,719,999,920
216,511,500
10
10
10
10
10
10
10
10
62,265,500
3,318,777,000
(1)
In October 2008, IFC entered into an agreement with Engro Corporation Limited to subscribe for
16,000,000 shares of Company at the Rupees equivalent of USD 0.17424 per share, which was PKR
13.77/- per share (including a cash premium of PKR 3.77 per share).The aforementioned transaction
resulting in a total premium of PKR 60,377,962/- out of which PKR 3,866,463/- was deducted on
account of share issuance cost, thus a net amount of PKR 56,511,500/- was recorded in the financial
statements.
Approval for the Employee Share Option Scheme (“Scheme”) was granted by SECP vide letter
dated September 25th, 2008. Under the Scheme, senior employees of the Company were granted
options to purchase newly issued ordinary shares of the Company at an exercise price of PKR 15/per ordinary share (if exercised in 2011) and PKR 17/- per ordinary share (if exercised in 2012)
respectively. The number of options granted had been calculated in accordance with the ability and
(2)
Page 9 of 72
criticality of an employee to the business, subject to the approval of the Board‟s Compensation
Committee constituted for the Scheme.
Vesting period commenced from the grant date and ended on December 31st, 2010, where after the
options could be exercised within a period of two years i.e. up to December 31st 2012. Fair values
per share determined at the time of exercise of options were PKR 16.29/- per share in the year 2011
and PKR 18.29/- per share in the year 2012. Cost of the balance amount of fair value per share at
the time of exercise of the options was borne by the Company and charged to the income statement.
2.2. THE OFFERORS
The following two shareholders are jointly offering 12.5% shares out of their respective
shareholdings in the Company:
Number of shares
being Offered
Name of the Offeror
Engro Corporation Limited (divesting its 100%
shareholding in the Company)
Engro Powergen Limited
Total
Percentage to the paid up
capital of the Company
32,000,000
9.88%
8,475,000
40,475,000
2.62%
12.5%
2.3. PRE-IPO PLACEMENT
40,475,000 ordinary shares (divested by Engro Powergen Limited) of the face value of PKR 10/each have been subscribed through the private placement by the following investors at the price of
PKR 30.02/- per share (including a premium of PKR 20.02/- per share) as per the agreements
mentioned in part 7.
No. of
Shares
3,750,000
20,250,000
36,344,000
16,500,000
40,000,000
25,020,000
20,000,000
7,989,500
7,989,500
75,750,000
5,250,000
13,691,000
75,750,000
15,991,000
7,507,500
40,540,500
72,760,688
33,033,000
80,080,000
50,090,040
40,040,000
15,994,979
15,994,979
151,651,500
10,510,500
27,409,382
151,651,500
32,013,982
Total
[including
premium]
(PKR)
11,257,500
60,790,500
109,104,688
49,533,000
120,080,000
75,110,040
60,040,000
23,984,479
23,984,479
227,401,500
15,760,500
41,100,382
227,401,500
48,004,982
40,475,000
81,030,950
121,505,950
404,750,000
810,309,500
1,215,059,500
Face Value
(PKR)
Investors
375,000
2,025,000
3,634,400
1,650,000
4,000,000
2,502,000
2,000,000
798,950
798,950
7,575,000
525,000
1,369,100
7,575,000
1,599,100
Almurtaza Machinery (Pvt.) Limited
Bank Alfalah Limited
Bulk Management (Pvt.) Ltd.
Elahi Electronics
Habib Bank AG Zurich
Habib Bank AG Zurich, UAE
Jubilee Life Insurance Company Limited
Liberty Mills Limited
Liberty Power Tech Limited
Metro Securities (Pvt.) Limited
Moosani Securities (Pvt.) Limited
Shakoo (Pvt.) Limited
Swift Textile Mills (Pvt.) Limited
Westbury (Pvt.) Limited
Employees of the Company and Engro
4,047,500
Group
40,475,000 Total
Page 10 of 72
Premium
(PKR)
2.4. PRESENT OFFER - OFFER FOR SALE OF SHARES TO GENERAL PUBLIC
No. of
Shares
The Present Offer of 40,475,000
ordinary shares (12.5% of the
total paid-up share capital of the
Company) of PKR 10/- each,
40,475,000
being offered at an Offer Price of
PKR 30.02/- per share (inclusive
of a premium of PKR 20.02/- per
share).
Face Value
(PKR)
Premium
(PKR)
404,750,000
810,309,500
Total
[including
premium]
(PKR)
1,215,059,500
Notes:
a. As per rule 3 (I) (iv) of the Companies (Issue of Capital) Rules, 1996, the sponsors shall
at all times retain at least 25% of the capital of the Company.
b. As per regulation No. 5.4.5 (a) of KSE‟s Rule Book (Chapter 5 - Listing of Companies
and Securities Regulations), sponsors‟ shareholding in excess of 25% shall not be
saleable for a period of six months from the last date of public subscription.
c. As per regulation No. 5.4.5 (b) of KSE‟s Rule Book (Chapter 5 - Listing of Companies
and Securities Regulations), allocation of shares, under Pre-IPO placement (as specified
in section 2.3) including employees of company / group companies etc., shall not be
saleable for a period of six months from the last date of public subscription.
2.5. OPENING AND CLOSING OF THE SUBSCRIPTION LIST
The subscription list will open for three (3) days at the commencement of banking hours on
September 22nd 2014 and will close on September 24th 2014 at the close of banking hours.
Please note that online applications can be submitted 24 hours a day during the subscription
period which will close at 12:00 midnight on September 24th 2014.
In order to facilitate investors, United Bank Limited “UBL” is offering electronic submission
of application (e-IPO) to its accountholders. UBL account holders can use UBL Net Banking
to submit their application via link http://www.ubldirect.com/corporate/ebank.
2.6. INVESTOR ELIGIBILITY FOR PUBLIC OFFER
Eligible investors include
a) Pakistani citizens residing in or outside Pakistan or persons holding two nationalities including
Pakistani Nationality;
b) Foreign nationals whether living in or outside Pakistan;
c) Companies, bodies corporate or other legal entities incorporated or established in or outside
Pakistan (to the extent permitted by their respective constitutive documents and existing
regulations as the case may be);
d) Mutual funds, provident/pension/gratuity funds/trusts (subject to the terms of their respective
Trust Deeds and existing regulations); and
Page 11 of 72
e) Branches in Pakistan of companies and bodies corporate incorporated outside Pakistan.
2.7. FACILITIES AVAILABLE TO NON-RESIDENT PAKISTAN AND FOREIGN
INVESTORS
Non-resident Pakistani investors and foreign investors may subscribe for the shares being offered
through this OFSD by using their Special Convertible Rupee Account (“SCRA”). For detail please
see Chapter XX of the Foreign Exchange Manual (2002) of the State Bank of Pakistan.
Foreign investors do not require any regulatory approvals to invest in the shares being offered
through this OFSD. Payment in respect of investment in the shares of the Company has to be made
in foreign currency through an inward remittance or through surplus balances in SCRA. Local
currency cash account(s) opened for the purpose of Foreign Portfolio Investment (FPI) is classified
as SCRA. There is no restriction on repatriation of sale proceeds and dividend payouts on shares.
Underlying client names/beneficial owners are required to be disclosed at depository level.
Key Documents required for individual(s):
1.
2.
Account opening request
Passport / ID
General documentation required for opening of SCRA account by institutional investors is:
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
Account opening request
Board Resolution & Signatories list
Passport / ID of Board of Directors
Passport / ID of all authorized signatories
Certificate of Incorporation (COI) or equivalent document like Trade Registry
Certificate, Business Registration Certificate, and Certificate of Commencement of
Business
Memorandum & Articles of Association
Withholding tax registration certificate / Certificate of country of domicile of client
Latest Annual Report
List of Board of Directors
List of Shareholders (greater than 10% holdings) and key officers
It is however pertinent to note that the procedure and requirements of each financial institution with
respect to opening of SCRA differs, hence it is advised to request the procedure from respective
financial institution.
Payments made by foreign investors shall be supported by proof of receipt of foreign currency
through normal banking channels. Such proof shall be submitted along with the Application by the
foreign investors.
2.8. MINIMUM AMOUNT OF APPLICATION AND BASIS FOR ALLOTMENT OF
SHARES
The basis and conditions of allotment to the general public shall be as follows:
(a) Application for shares below the total value of PKR 15,039/- (Offer Price plus PKR 0.01 per
share (Stamp duty on transfer of shares) plus 0.048032 per share (CDC charges of 0.16% of the
Offer Price) x 500 shares) shall not be entertained in case of transfer of shares to CDC account.
In case physical shares are desired application for shares below the total value of PKR 15,085/Page 12 of 72
(Offer Price plus PKR 0.15 per share (Stamp duty on transfer of shares) x 500 shares) shall not
be entertained.
(b) The minimum amount of application for subscription of 500 shares is PKR 15,039/- (Offer
Price plus PKR 0.01 per share (Stamp duty on transfer of shares) plus 0.048032 per share
(CDC charges of 0.16% of the Offer Price) x 500 shares) in case shares are desired to be
transferred to a CDC account. In case physical shares are desired, minimum amount of
application for subscription of 500 shares is PKR 15,085/- (Offer Price plus PKR 0.15 per
share (Stamp duty on transfer of shares) x 500 shares) for both in physical form and shares
under the book entry system.
(c) Application for shares must be made for 500 shares or in multiple of 500 shares only.
Applications which are neither for 500 shares nor for multiples of 500 shares shall be rejected.
(d) SUBMISSION OF FICTITIOUS AND MULTIPLE APPLICATIONS (MORE THAN
ONE APPLICATION BY SAME PERSON) IS PROHIBITED AND SUCH
APPLICATIONS’ MONEY IS LIABLE TO CONFISCATION UNDER SECTION 18A
OF THE SECURITIES AND EXCHANGE ORDINANCE, 1969.
(e) If the shares offered to the general public are sufficient to accommodate all applications, all
applications shall be accommodated.
(f) If the shares applied for are in excess of the shares offered, the distribution shall be made by
computer balloting, in the presence of the representative(s) of the Stock Exchange in the
following manner:
(i) If all the applications for 500 shares can be accommodated, then all such applications
shall be accommodated first. If all applications for 500 shares cannot be accommodated,
then balloting will be conducted among applications for 500 shares only.
(ii) If all the applications for 500 shares have been accommodated and shares are still
available for allotment, then all applications for 1,000 shares shall be accommodated. If
all applications for 1,000 shares cannot be accommodated, then balloting will be
conducted among applications for 1,000 shares only.
(iii) If all applications for 500 shares and 1,000 shares have been accommodated and shares
are still available for allotment, then all applications for 1,500 shares shall be
accommodated. If all applications for 1,500 shares cannot be accommodated, then
balloting will be conducted among applications for 1,500 shares only.
(iv) If all applications for 500 shares, 1,000 shares and 1,500 shares have been
accommodated and shares are still available for allotment, then all applications for 2,000
shares shall be accommodated. If all applications for 2,000 shares cannot be
accommodated, then balloting will be conducted among applications for 2,000 shares
only.
(v) After the allotment in the above mentioned manner, the balance shares, if any, shall be
allotted in the following manner:

If the remaining shares are sufficient to accommodate each application for over
2,000 shares, then 2,000 shares shall be allotted to each applicant and remaining
shares shall be allotted on pro-rata basis.
Page 13 of 72

If the remaining shares are not sufficient to accommodate all the remaining
applications for over 2,000 shares, then balloting shall be conducted for allocation of
2,000 shares each to the successful applicants.
(g) If the Offer is over-subscribed in terms of amount only, then allotment of shares shall be made
in the following manner:
(i) First preference will be given to the applicants who applied for 500 shares;
(ii) Next preference will be given to the applicants who applied for 1,000 shares;
(iii) Next preference will be given to the applicants who applied for 1,500 shares;
(iv) Next preference will be given to the applicants who applied for 2,000 shares; and then
(v) After allotment of the above, the balance shares, if any, shall be allotted on pro rata basis
to the applicants who applied for more than 2,000 shares.
(h) Allotment of shares will be subject to scrutiny of applications for subscription of shares.
(i) Applications, which do not meet the above requirements, or applications which are incomplete,
will be rejected.
2.9. REFUND OF SUBSCRIPTION MONEY TO UNSUCCESSFUL APPLICANTS
On behalf of the Offerors, the Company shall take a decision within ten (10) days of the closure of
subscription list as to which applications have been accepted or are successful and refund the
money in cases of unaccepted or unsuccessful applications within ten (10) days of the date of such
decision, as required under Section 71 of the Ordinance.
As per Sub-section (2) of Section 71 of the Ordinance, if refund as required under Sub-section (1)
of Section 71 of the Ordinance is not made within the time specified therein, the Offerors shall be
liable to repay the money with surcharge at the rate of 1.5%, for every month or part thereof from
the expiration of the 15th day and, in addition, to a fine not exceeding PKR 5,000/- and in case of
continuing offense to a further fine not exceeding PKR 100/- per day after the said 15th day of
which the default continues. Provided that the Offerors shall not be liable if it proves that the
default in making the refund was not due to any misconduct or negligence on its part.
2.10. CREDIT AND DISPATCH OF SHARE CERTIFICATES
On behalf of the Offerors, the Company will dispatch share certificates to successful applicants
through their Banker to the Offer or by crediting the respective Central Depository System
(“CDS”) accounts of the successful applicants within thirty (30) days of the close of public
subscription, as per Listing Regulations of the Stock Exchange.
Shares will be issued either in scrip-less form in the CDS of CDCPL or in the shape of physical
scripts on the basis of option exercised by the successful applicants. Shares in the physical scripts
shall be dispatched to the Bankers to the Offer within thirty (30) days from the date of close of
subscription list, whereas scrip-less shares shall be directly credited through book entries in the
respective accounts maintained with the CDCPL. Please note that Transfer charges and Stamp
Duty, as the case may be, will not be borne by the Offerors.
The applicants who opt for receipt of shares in scrip-less form in CDS should fill in the relevant
columns of the Application Form. In order to exercise the scrip-less option, the applicant(s) should
have CDS account at the time of subscription.
Page 14 of 72
If the Offerors make a default in complying with the above requirements, they shall pay to the
Stock Exchange a penalty of PKR 5,000/- per day for every day during which the default
continues. The Stock Exchange may also notify the fact of such default and the name of the
Company by notice and also by publication in its Ready-Board Quotation of the Stock Exchange.
The name of the Company will also be notified to the members of the Exchange and placed on the
website of the Exchange.
2.11. TRANSFER OF SHARES
a) Physical Scripts
Under the provisions of Section 77 of the Ordinance, the Directors of the Company shall not
refuse to transfer any fully paid share unless the transfer deed is, for any reason, defective or
invalid or is not accompanied by the relevant share certificate. Provided that the Company shall
within thirty (30) days from the date on which the instrument of transfer was lodged with it,
notify the defect or invalidity to the transferee who shall, after the removal of such defect or
invalidity, be entitled to re-lodge the transfer deed with the Company.
b) Transfer under book entry system
The shares maintained with the CDS in the book entry form shall be transferred in accordance
with the provisions of the Central Depositories Act, 1997 and the CDCPL Regulations.
2.12. SHARES ISSUED IN PRECEDING YEARS
Date of Allotment
February 28, 2006
Number of
shares
Par
Value
Amount
(Par Value)
(per share)
Amount
(Share
Premium)
Share
Premium
Amount
(Total)
Consideration
2
10
20
-
-
20
Cash
August 22, 2006
1,499,998
10
14,999,980
-
-
14,999,980
Cash
January 31, 2007
11,000,000
10
110,000,000
-
-
110,000,000
Cash
December 7, 2007
152,800,000
10
1,528,000,000
-
-
1,528,000,000
Cash
September 9, 2008
138,700,000
10
1,387,000,000
-
-
1,387,000,000
Cash
October 11, 2008
16,000,000
10
160,000,000
3.77
60,377,962
220,377,962
Cash
November 4, 2011*
900,000
10
9,000,000
5
4,500,000
13,500,000
Cash
November 24, 2011*
150,000
10
1,500,000
5
750,000
2,250,000
Cash
2,425,000
10
24,250,000
5
12,125,000
36,375,000
Cash
December 29, 2011*
125,000
10
1,250,000
5
625,000
1,875,000
Cash
June 28, 2012*
150,000
10
1,500,000
7
1,050,000
2,550,000
Cash
50,000
10
500,000
7
350,000
850,000
Cash
79,777,692
3,317,777,962
December 8, 2011*
December 27, 2012*
TOTAL
323,800,000
3,238,000,000
* Shares issued under Employee Shares Option Scheme
2.13. PRINCIPAL PURPOSE OF THE OFFER FOR SALE OF SHARES
The purpose of this Offer for Sale of Shares by ECL and EPL is to expand and diversify the capital
base, improve governance structure of the Company, raise liquidity and consequently access
alternate capital resources. Proceeds from the Offer will be utilized to:
(i) pay-off conventional liabilities, and
(ii) finance new projects such as the LNG terminal
Page 15 of 72
2.14. INTEREST OF SHAREHOLDERS
None of the holders of the issued shares of the Company, except IFC who is also senior lender,
have any special or other interest in the property or profits of the Company other than as holders of
the ordinary shares in the capital of the Company.
2.15. DIVIDEND POLICY
The rights in respect of capital and dividends attached to each share are and will be the same. The
Company in its general meeting may declare final dividends but no dividends shall exceed the
amount recommended by the Directors. Dividend, if declared, in the general meeting, shall be paid
according to the terms of the provisions of the Ordinance.
The Directors may from time to time pay to the members such interim dividends as appear to the
Directors to be justified by the profits of the Company. No dividends shall be paid otherwise than
out of the profits of the Company for the year or any other undistributed profits.
No unpaid dividends shall bear interest or mark-up against the Company. The dividends
shall be paid within the period prescribed under the Ordinance.
Those investors who intend that their cash dividend, if any, is directly credited in their Bank
Account, must fill-in the relevant part of the shares subscription Form under the heading,
“Dividend Mandate Option”.
2.16. ELIGIBILITY FOR DIVIDEND
The shares being offered shall rank pari-passu with the existing shares in all matters, including the
right to such bonus or right issue and dividend as may be declared by the Company subsequent to
the offer of such shares.
The Company has already declared and paid an interim dividend of PKR 1.54/- per share (as
of 30th June 2014), out of the profit for the financial year ending 31st December 2014 to the
existing shareholders, that excludes Pre-IPO Placement Investors and the General Public.
2.17. DEDUCTION OF ZAKAT
Income distribution will be subject to deduction of Zakat at source, pursuant to the provisions of
Zakat and Ushr Ordinance, 1980 (XVIII of 1980) as may be applicable from time to time (except
where the Ordinance does not apply to any shareholder or where such shareholder is otherwise
exempt or has claimed exemption from payment/deduction of Zakat in terms of and as provided in
that Ordinance).
2.18. CAPITAL GAINS (SECTION 37-A)
Capital gains derived from the sale of listed securities are taxable in the following manner under
Section 37A of the Income Tax Ordinance, 2001.
Page 16 of 72
S. No.
Tax Year
1
2015
Tax Rate
Holding period of securities
more than one year and less
less than one year
than two years
12.5%
10%
more than two
years
0%
2.19. WITHHOLDING TAX ON DIVIDENDS
Dividend distribution to shareholders will be subject to withholding tax at the reduced rate of 7.5%
as specified in Clause 20 of Part 2 of the Second Schedule to the Income Tax Ordinance, 2001.
2.20. EXEMPTION FROM INCOME TAX
Income of the Company derived from the electric power generation project is exempted from
income tax under clause 132 of Part-1 of the Second Schedule to the Income Tax Ordinance, 2001.
2.21. DEFERRED TAXATION
The profits and gains of the Company derived from electric power generation are exempt from tax
under terms of clause 132 of Part-I of the Second Schedule to the Income Tax Ordinance, 2001
therefore no provision for deferred taxation is required to be made by the Company.
2.22. SALES TAX ON SALE/PURCHASE OF SHARES
Under the Constitution of Pakistan and Article 49 of the 7th NFC Award the Government of Sindh
and the Government of Punjab have promulgated the Sindh Sales Tax on Services Act, 2011 and
the Punjab Sales Tax on Services Act, 2012 respectively. The Sindh Revenue Board and the
Punjab Revenue Authority administer and regulate the levy and collection of the Sindh Sales Tax
(SST) and Punjab Sales Tax (PST) respectively on the taxable services provided or rendered in
Sindh or Punjab.
The value of taxable services for the purpose of levy of sales tax is the gross commission charged
from clients in respect of purchase or sale of shares in a Stock Exchange. As per Sindh Finance Act
2014-15, as mentioned in Part B of the Second Schedule (Taxable Services) read with Section 3 of
the Sindh Sales Tax on Services Act, 2011, the sales tax on Brokerage is 15%.
2.23. CAPITAL VALUE TAX (CVT) ON PURCHASE OF SHARES
Pursuant to amendments made in the Finance Act, 1989 through Finance (Amendments)
Ordinance, 2012 promulgated on April 24, 2012, 0.01% Capital Value Tax will be applicable on
the purchase value of shares.
2.24. JUSTIFICATION FOR PREMIUM

Professional Management Team with Proven Track Record
The Company has a strong emphasis on recruiting and retaining best professionals who are
central to its business model. The management team boasts strong professional backgrounds
from top tier institutions.
A testament to this is the fact that the Project was constructed at a cost of US$ 0.89 million /
MW which is amongst the lowest in thermal IPPs that have come online under the Power
Page 17 of 72
Policy 2002 thus benefiting the end users in the form of lower tariff. Furthermore, the Project
was completed 3 months prior to RCOD, highlighting the management‟s ability to timely
execute key deliverables.
In addition to the above, the Company has operated the Project at par with other IPPs over the
course of its life through its in-house O&M team further highlighting its operational excellence
and commitment to quality.

Among the Low Cost Power Producers
The Company operates a new and state-of-the-art technology to produce low cost power from
permeate gas. It is a well-known fact that amongst thermal power projects, gas based projects
are one the cheapest source of power due to their substantially lower fuel cost. The Company
thus ranks higher in NEPRA‟s dispatch merit order list, benefiting from higher dispatch factor.

Guaranteed Returns
The Project was established under the Power Policy 2002 whereby, the Company is guaranteed
a US$ IRR of ~ 15% irrespective of off take or dispatch. Under the aforementioned policy and
the PPA, tariff is determined using a cost plus fixed return of equity approach and individual
tariff components are indexed for variation in exchange rate(s) and inflation, thus hedging the
Company against exchange rate and inflation risk.
Additionally, certain variations in fuel price are also passed on to the Power Purchaser. IPPs
enjoy exemption from income tax (including turnover tax) and withholding tax on import
during project construction. Also GoP is required to reimburse the Company for certain
adverse changes in duties and taxes, and against specified political risks.

Unique Source of Fuel Supply
The Company utilizes permeate gas from the Qadirpur gas field as fuel to run its operations.
The permeate gas has a low BTU value and was previously flared / wasted due to its limited
use. Due to the unique nature of its fuel source the present gas supply shortage in the country
and the resultant curtailment faced by industries across the board, the Company faces a
significantly lower risk of gas curtailment.

Capital Appreciation Potential
Return on equity is likely to increase over the life of the Project due to the gradual depreciation
parity resulting in higher dividend stream. Furthermore in the current scenario of a stable to
declining interest rate environment, high yielding shares also offer capital appreciation
potential.

Engro, a Leading Corporate Entity
Engro is a leading brand name in Pakistan, and has an excellent reputation amongst its
customers, suppliers, lenders and other stake holders due to its professional corporate structure,
experienced management, quality products, innovation, diversification and continued growth
strategy.
Over the last decade, Engro Corporation Limited has grown from PKR 10 billion to PKR 155
billion in terms of revenue and is one of the largest industrial corporations in Pakistan
operating in various sectors including Fertilizer, Foods, Energy and Chemicals. Engro
Corporation has differentiated itself in Pakistan‟s business landscape by its proven ability to
Page 18 of 72
grow the business through its superior management expertise and its commitment to Pakistan,
where it has invested over USD 1.9 billion in projects from 2007 to 2011. In terms of market
capitalization, Engro Corporation is also one of the largest private sector companies listed on
the Karachi Stock Exchange.
Page 19 of 72
PART 3
3 UNDERWRITING, COMMISSIONS, BROKERAGE AND OTHER EXPENSES
3.1. UNDERWRITING
The Offer of 40,475,000 ordinary shares at an Offer Price of PKR 30.02/- per share has been
fully underwritten as under:
Name of Underwriter
Habib Bank Limited
Bank Alfalah Limited
Total
Number of Shares
20,237,500
20,237,500
40,475,000
Amount (PKR)
607,529,750
607,529,750
1,215,059,500
If, and to the extent, the Ordinary Shares underwritten are not subscribed and paid for in full
by the closing date for the public subscription, the Underwriters in terms of the underwriting
agreements will, within two (2) days of being called upon to do so by the Offerors, (i)
subscribe and take up against full payment in cash or (ii) procure subscribers to subscribe and
take up against full payment in cash, the shares remained unsubscribed subject to the
maximum number of the shares underwritten by each of them.
In opinion of the Directors, the resources of the Underwriters are sufficient to discharge their
underwriting commitments.
3.2. UNDERWRITING COMMISSION
The underwriters have been paid an underwriting commission at the rate of 0.75% of the
amount of Offer underwritten by them. In addition, a take up commission at the rate of 0.25%
shall be paid to the underwriters on the value of shares required to be subscribed by them by
virtue of their respective underwriting commitments.
3.3. BUY BACK/REPURCHASE AGREEMENT
THE UNDERWRITERS HAVE NOT ENTERED INTO ANY BUY BACK/RE-PURCHASE
AGREEMENT WITH THE OFFERORS OR ANY OTHER PERSON IN RESPECT OF THIS
PUBLIC OFFER.
ALSO, NEITHER THE OFFERORS NOR ANY OF THEIR ASSOCIATES HAVE ENTERED
INTO ANY BUY BACK/REPURCHASE AGREEMENT WITH THE UNDERWRITERS OR
THEIR ASSOCIATES. THE OFFERORS AND THEIR ASSOCIATES SHALL NOT BUYBACK
/ REPURCHASE SHARES FROM THE UNDERWRITERS AND THEIR ASSOCIATES.
3.4. COMMISSION TO THE BANKERS TO THE OFFER
A commission at the rate of 0.25% of the amount collected on allotment in respect of successful
applicants will be paid by the Offerors to the Bankers to the Offer for services to be rendered by
them in connection with this Offer for Sale of Shares.
3.5. BROKERAGE
For the public offering, the Offerors will pay brokerage to the TREC holders of the Exchange at the
rate of 1% of the value of shares (including premium) actually sold through them. No brokerage
Page 20 of 72
shall be paid to the TREC in respect of shares taken up by the underwriters by virtue of their
underwriting commitments.
3.6. ESTIMATED EXPENSES TO THE OFFER FOR SALE
The expenses of this Offer are estimated not to exceed PKR 69.73 million. All such expenses are
to be borne by the Offerors. Details of the expenses are mentioned below:
Expenses
Rate
Amount (PKR)
Financial Advisor & Lead Arrangers Fee
0.92%
22,357,095
Underwriting Commission – General Public
0.75%
9,112,946
Take up Commission – General Public
0.25%
3,037,649
Brokerage to Members of the Stock Exchange
1.00%
12,150,595
Bankers to the Offer Commission
0.25%
3,037,649
Printing, Publication and Notice Costs
KSE Initial Listing Fee, Annual Listing Fee,
Service Charges
SECP Application and Processing Fee
3,000,000
Balloting Agent
2,220,000
Marketing Cost
5,000,000
Legal & Professional Fee
1,500,000
Miscellaneous Cost
5,000,000
Total
3,118,012
200,000
69,733,946
Page 21 of 72
PART 4
4 HISTORY AND PROSPECTS
4.1. BRIEF HISTORY
4.1.1. The Offerors
Engro Corporation Limited
Engro Corporation Limited (formerly known as “Engro Chemical Pakistan Limited”) is one
of the largest industrial corporations in Pakistan operating in various sectors including
Fertilizer, Foods, Energy and Chemicals. It is a public limited company and is listed on the
Karachi, Lahore and Islamabad Stock Exchanges.
An Esso/Mobil joint venture started operations in 1957 which discovered the Mari Gas field
near Daharki. In 1965 Esso set up EssoPakistan Fertilizer Company Limited which started
manufacturing and marketing fertilizers and established a full-fledged marketing organization
which undertook agronomic programs to educate the farmers of Pakistan. As the nation‟s first
fertilizer brand, Engro (then Esso) helped modernize traditional farming practices. In 1971,
Esso Pakistan Fertilizer Company Limited became Exxon Chemical Pakistan Limited and
then later Engro Chemical Pakistan Limited as a result of the most successful employee buyout in Pakistan‟s corporate history.
On January 1st, 2010, after a demerger of the fertilizer business, Engro Chemical Pakistan
Limited was renamed Engro Corporation Limited and established as a holding company. The
principal activity of the the Holding Company is to manage investments in subsidiary
companies and joint ventures.
Engro Corporation has differentiated itself in Pakistan‟s business landscape by its proven
ability to grow the business through its superior management expertise and its commitment to
Pakistan, where it has invested over USD 1.9 bn in projects from 2007 to 2011. In terms of
market capitalization, Engro Corporation is also one of the largest private sector companies
listed on the Karachi Stock Exchange.
Engro Powergen Limited
Engro Powergen Limited, a wholly owned subsidiary of Engro Corporation Limited, was
incorporated in 2008 to develop power projects in Pakistan with a view to addressing the
perennial power shortage in the country while still earning a competitive return for its
shareholders.
Engro Powergen Limited is the parent company of Engro Powergen Qadirpur Limited which
operates a 217.298 (net) MW Combined Cycle Power Plant and in 2009 also entered into a
joint venture with the Sindh government, to establish the Sindh Engro Coal Mining Company
Limited whose principal purpose is to mine coal from Thar Block-II and is also developing
660 MW coal based power project.
4.1.2. The Company
Engro Powergen Qadirpur Limited (“EPQL” or the “Company”) was incorporated in Pakistan
on February 28th, 2006 as a private limited company. Effective March 24, 2008, the
Company was converted to an unlisted public company.
Page 22 of 72
Engro Powergen Qadirpur Limited was established to undertake the business of power
generation and sale. The Company completed construction and testing of its 217.298 (net)
MW combined cycle power plant and commenced commercial operations on March 27, 2010.
The electricity generated is transmitted to the National Transmission and Dispatch Company
(“NTDC”) under the Power Purchase Agreement (“PPA”) dated October 26, 2007 which is
valid for a period of 25 years from the Commercial Operations Date.
4.1.3. Plant Details
The Company has set up a 217.298 (net) MW gas based thermal power project near Qadirpur,
District Ghotki, Sindh. The Company operates a plant of Chinese origin which was acquired
brand new in the years 2007-2009.
The project is unique as it converts low-BTU, high sulphur content permeate gas, which was
earlier being wasted and flared, into much needed electric power. The plant is a Combine
Cycle Plant, with 1+1+1 configuration; i.e. one gas turbine, one Heat Recovery Steam
Generator (“HRSG”), and one steam turbine. The plant uses permeate gas as its primary fuel
source and HSD as the startup and backup fuel. The unique fuel usage, which was previously
being flared, makes Engro Powergen Qadirpur Limited one of the lowest tariff power plant as
compared to other thermal based power plant in the economic merit order and also results in a
net saving of national energy. The low cost of fuel does not have an impact on net
profitability of the Company since it is a pass through item.
The plant operates on highly efficient technology resulting in a lower cost of power
generation. China Tianchen Chemical Engineering Corporation (TCC) was chosen as
Engineering and Procurement Contractor for the project and China National Construction and
Engineering Company (CNCEC) was chosen as construction contractor after a competitive
bidding process.
A tariff based on a net output of 217.3MW (while operating on permeate gas) and 212.9MW
(while operating on HSD) was approved by the NEPRA.
Brief synopsis of the Engro Powergen Qadirpur Limited power plant is provided in the table
below:
Location
Plot Size
Total Gross Capacity
Auxiliary Consumption
Net Capacity (with correction)
Gas Turbine Specifications
Steam Turbine Specifications
Commerical Operations Date
Total Project Cost (actual)
Fuel
Gas Supply Contract
Project Life
EPC Contractor
Construction Contractor
2.5 KM approx from OGDCL‟s Qadirpur gas treatment plant
40 Acres
224.8 MW
7.5 MW
217.3 MW
Combined Cycle Gas Turbine – GE PG9171E supplied by
Nanjing Turbine Company
Harbin Steam Turbine Factory Co. Ltd., China
March 27, 2010
USD 194 Million
- 75MMSCFD Permeate Gas from Qadirpur Gas Field
- High Speed Diesel (HSD) as startup and backup fuel
Sui Nothern Gas Pipelines Limited (SNGPL)
25 Years (~21 years remaining)
China Tianchen Chemical Engineering Corporation (TCC)
China National Construction and Engineering Company
(CNCEC)
Page 23 of 72
4.1.4. Location
Land for the project site was purchased near OGDCL‟s Qadirpur gas plant in February 2007
in Qadirpur, District Ghotki, Sindh. Raw water to meet normal plant needs is drawn from the
Ghotki feeder canal located approximately 7 km south of the project site under a permit from
the Sindh Irrigation and Drainage Authority.
4.1.5. Project Construction and Implementation Status
The Engro Powergen Qadirpur Limited project was initiated with the submission of a
proposal to PPIB for approval in January 2005 and it commenced commercial operations on
March 27, 2010, in the shortest time as compared to other IPPs. Provided below are key
milestones in the project‟s development:
Milestones
Date
Proposal submitted to PPIB
PPIB Approved 75 MMSCFD Permeate Gas
Feasibility Approved by PPIB
Tariff Petition Submitted to NEPRA
NEPRA Public Hearing Held
NEPRA Tariff Determination
EPC Contract Signed
PPA / IA Signed
GSA Signing after OGRA Approval
GSA Amendment & Financial Close
IFC Equity Injection
First Fire of Gas Turbine
Synchronization of Plant with WAPDA
Mechanical Completion
Commercial Operations Date
Physical and Financial Project Completion Date
Jan 2005
Sep 2005
Sep 2006
Feb 2007
Mar 2007
July 2007
Oct 2007
Oct 2007
Apr 2008
Oct 2008
Oct 2008
Dec 2009
Dec 2009
Mar 2010
March 27, 2010
July 19, 2011
4.1.6. Production Since Achieving Commercial Operations Date(COD):
The Project achieved COD on March 27, 2010, representing one of the shortest construction
periods for comparable IPPs in recent history. Over 3 years of operations the plant has
operated at a healthy average billable availability factor of 95%:
2nd Quarter(Apr- Jun) 2010
3rdQuarter (Jul-Sep) 2010
4th Quarter (Oct-Dec) 2010
Full year 2010
1st Quarter (Jan-Mar) 2011
2nd Quarter(Apr- Jun) 2011
3rd Quarter (Jul-Sep) 2011
4th Quarter (Oct-Dec) 2011
Full year 2011
1stQuarter(Jan- Mar) 2012
2nd Quarter(Apr- Jun) 2012
3rdQuarter (Jul-Sep) 2012
4th Quarter (Oct-Dec) 2012
Full year 2012
1stQuarter(Jan- Mar) 2013
Billable Availability
Factor
99.2%
88.6%
98.1%
95.0%
99.7%
100.2%
100.1%
100.3%
100.1%
100.4%
100.0%
100.6%
101.1%
100.5%
101.1%
Page 24 of 72
Load Factor
85.3%
71.3%
89.9%
82.5%
83.0%
85.8%
87.9%
96.3%
88.1%
88.9%
96.5%
95.2%
95.3%
93.9%
97.8%
Billable Availability
Factor
100.8%
100.6%
30.5%
83.1%
98.8%
2nd Quarter(Apr- Jun) 2013
3rd Quarter (Jul-Sep) 2013
4th Quarter (Oct-Dec) 2013*
Full year 2013
1stQuarter(Jan- Mar) 2014
Load Factor
74.0%
99.7%
15.5%
71.7%
95.0%
*Note: The plant went into a complete shutdown on Oct 12, 2013 due to fault in gas turbine generator rotor.
This was a unique failure of GT - Gen Rotor and there was no experience / expertise available in Pakistan,
but team managed to reach out & found an expert vendor – Korean Power Services, and the repair was done
at site which was the first of its kind in Pakistan. The plant was brought back online on December 27, 2013
and is functioning smoothly after repair.
4.1.7. Key Contractors / Technology Partners
Key contractor and technology partners of Engro Powergen Qadirpur Limited and their brief
profiles are given in the table below:
Contractor / Technology Partner
China Tianchen Chemical
Engineering Corporation
(TCC)
Role
Engineering and
Procurement Contractor
Profile
TCC was founded in 1953
and is one of the leading
international engineering
corporations in the world.
On the international front,
TCC is ranked as a top
225 Global International
Contractor in the
American "Engineering
News Records" (ENR).
TCC is ISO 9001 quality
system certified. In 2002,
TCC also passed the
certification for ISO
14001, GB/T28001
Occupational Safety &
Health and Environmental
Management system.
CNCEC, a large
corporation directly
administrated by the State
Council of China, acted as
Construction Contractor
for the project.
China National Construction
and Engineering Company
(CNCEC)
Construction Contractor
The company has
diversified exposure in
the fields of Power,
Fertilizer, Petrochemical,
Oil Refinery and
Infrastructure
CNCEC has successfully
executed more than 1,000
Page 25 of 72
Contractor / Technology Partner
Masaood John Brown
International (MJBI)/Harbin
Hanghao Power Station
Equipment Science and
Technology Co. Ltd
Role
Long-Term Service
Agreement-Maintenance
Support
Profile
contracts with a
cumulative value
exceeding USD 4,000
million in over 40
countries
EPQL has entered into
maintenance support
contract with Masaood
John Brown International
(MJBI) and Harbin
Hanghao Power Station
Equipment Science and
Technology Co. Ltd.
MJBI is a world
renowned service
provider for Frame 9E gas
turbine. Harbin Hanghao
is the maintenance
support arm of Harbin
Turbine Company, OEM
of steam turbine. Both the
contractors have
mobilized during the first
maintenance outage in
March 2011.
4.1.8. Key Operational Contracts
Detail of Key Operational Contracts is provided at paragraph 7.8.4.
4.1.9. Project Funding
The total project cost was initially estimated at USD 205 million as against the actual cost of
USD 194 million at COD which had been financed in a Debt-Equity ratio of 75/25. The entire
senior debt was arranged through international financing in the following manner;
Institutions
Agreement Date
International Finance Corporation (IFC)
DEG of Germany (DFI)
FMO of Netherland (DFI)
Proparco of France (DFI)
Swedfund of Sweden (DFI)
OPEC Fund for International
Development (OFID)
Total Debt
19/12/2007
19/12/2007
19/12/2007
19/12/2007
19/12/2007
19/12/2007
USD million
Amount
Amount
Committed
Utilized
57
53.1
20
18.7
28
26.0
23
21.9
13
12.2
13
12.1
154
144.0
Ultimately only USD 144 million of debt financing was utilized and these international
lenders are scheduled to be completely repaid by the year 2020. As of December 31, 2013 the
current outstanding amount is USD 105 million.
Page 26 of 72
4.1.10. Tariff
The power purchaser ensures guaranteed returns through a tariff structure covering all fixed
and variable costs. Summarized tariff structure is presented below:

Tariff structure is classified into two components; (a) cash outflows linked with capacity
utilization of the plant such as fuel price, variable O&M, etc. (referred as “Energy
Purchase Price”) and (b) cash outflows independent of capacity utilization of the plant
such as debt servicing, return on equity, fixed O&M costs etc. (referred as “Capacity
Purchase Price”). Hence, equity returns are assured regardless of capacity utilization of
the plant provided the plant is made available for dispatch.

The equity investors are guaranteed a US dollar based equity IRR of 15% provided that
the company is making dependable power capacity available. The table below illustrates
the tariff structure applicable to all thermal IPPs.
Engro Powergen Qadirpur Limited has one of the lowest tariffs amongst other thermal IPPs
bringing it on higher priority in the merit order of dispatch.
Engro Powergen Qadirpur Limited‟s tariff (excluding fuel cost component) has been trued-up
by NEPRA and is shown below:
Year 1 (2010 –
2011 ) to 10 (20202021)
Capacity charge for Operation on Gas (PKR/kW/Hr)
Fixed O&M – Foreign
US$/PKR& US CPI
0.0096
Fixed O&M – Local*
CPI (General) - Local
0.1796
Insurance
Actual on yearly basis
0.0630
Cost of Working Capital
KIBOR Variation
0.0537
ROE
US$/PKR
0.3438
ROEDC
US$/PKR
0.1265
Libor & Exchange rate
Debt Servicing
0.7121
Variation
Total Capacity Charge
1.4883
Energy charge for Operation on Gas (PKR/kWH)
Variable O&M – Foreign US$/PKR& US CPI
0.1917
Variable O&M – Local*
CPI (General) - Local
0.0501
Total Variable O&M
(PKR/ KWh)
0.2418
*Reference values revised by NEPRA for April 2011 onwards
Tariff Component
Indexation
Page 27 of 72
Year 11 (20212022) to 25
(2034-2035)
0.0096
0.1796
0.0630
0.0537
0.3438
0.1265
0.7762
0.1917
0.0501
0.2418
Tariff for Q2, 2014 as approved by NEPRA is as follows:
Revised April-June
2014 Quarter – Gas
Tariff Components
Capacity Charge (PKR/kW/Hour)
Fixed O&M – Foreign
Fixed O&M – Local
Insurance
Cost of Working Capital
ROE
ROEDC
Debt Servicing
Total Capacity Charge (PKR/kW/Hour)
0.0121
0.2194
0.0687
0.0455
0.3997
0.1471
0.8252
1.7177
Variable O&M (PKR/kWh)
Variable O&M – Foreign
Variable O&M – Local
Total Variable O&M (PKR/kW/Hour)
0.2414
0.0612
0.3026
The aforementioned tariff is subject to quarterly revision. For future reference, latest tariff of
the Company can be found at http://www.nepra.org.pk/tariff_ipps.htm. The tariff applicable in
Q2 including fuel cost was of PKR 7.0666 per kW/Hour.
4.2. Power Industry Overview
The Power Sector of Pakistan is primarily operated through the Water and Power Development
Authority (“WAPDA”) which distributes electricity across Pakistan except for the metropolitan
city of Karachi (and its surrounding areas) which are distributed electricity via K-Electric.
However, given the dearth of electricity and due to the Government of Pakistan‟s initiative to boost
investment in this sector, private sector participation in power generation has increased in recent
years with establishment of 35 Independent Power Projects (“IPPs”) contributing a total of ~43% to
the total electricity generation in Pakistan.
As of 2013, the total electricity generation capacity of Pakistan was 23,663 MW, of which thermal
contributed 16,000 MW (67.62%), hydroelectric contributed 6,826 MW (28.85%), nuclear
contributed 787 MW (3.33%) and 50 MW (0.2%) was contributed by wind power. Domestic users
are the largest consumers of electricity consuming ~46%; followed by the industrial sector ~30%,
agriculture ~11% and the commercial sector ~8% respectively.
Pakistan finds itself very short in terms of power supply, with supply unable to keep pace with
demand which is expected to increase in a range of 5-7% per annum, with the domestic power
industry unable to generate enough electricity to meet the country‟s needs resulting in a supply
deficit of more than 5,000 MW at peak demand levels. This situation is expected to persist in the
short to medium term. The spike in shortfall is primarily due to following reason:
-
Capacity is underutilized from existing power plants
-
No major expansion neither from private nor from public sector
-
Significant Transmission and Distribution Losses
-
Creation of circular debt
Page 28 of 72
Units in MW
Generation Capability
Peak Demand
Deficit
25,000
8,000
20,000
6,000
15,000
4,000
10,000
2,000
5,000
-
FY09
FY10
FY11
FY12
FY13
Source: NEPRA, BAFL & HBL Research
Chronic power deficit in the country has been regarded as one of the most significant challenges
facing the country, particularly in the manufacturing sector. With limited addition to the power grid
during FY08-FY13, the deficit is currently estimated to be over 5, 000MW while circular debt leads
to further under-utilization of resources. The gross amount of circular debt, at present, is estimated
to be at the levels PKR300bn (May‟14).
Electricity Generation By Source
(FY05)
Electricity Generation by Source
(FY13)
4% 2%
1%
16%
31%
36%
30%
52%
27%
Oil
Gas
Hydel
Nuclear
Others
Oil
Gas
Hydel
Nuclear
Coal
Source: NEPRA
4.3. RISK FACTORS
4.3.1. Off-take Risk
Low dispatch / off-take from the Project may result in lower revenue for the Company and
resultantly lower profits. This may have an adverse effect on investor returns.
Mitigating Factor:
Under the PPA, tariff payments are bifurcated into capacity payments and energy payments.
Capacity payments require reimbursement of certain fixed costs, financing costs and returns on
equity to the Company irrespective of Off-take, whereas energy payments are based on certain
variable costs.
Subject to the terms of the PPA, the Power Purchaser is obligated to make capacity payments
to the Company provided the Company is able to keep available the committed capacity.
Page 29 of 72
4.3.2. Operational Risk
Unlike other IPPs, the Company operates the plant through internal O&M service providers. In
the event, the Company is unable to make available the committed capacity it will lead to a
reduction in capacity payments and consequently, return on equity which cannot be passed on
to the O&M contractor in the form of liquidated damages.
Mitigating Factor:
The Company has put into place a highly professional and experienced O&M team which
ensures continuity of operations, compliance with the terms of the relevant contracts
(including the PPA) and maintains and operates the plant as per requisite schedules.
Furthermore, being cognizant of the criticality of its O&M team, the Company has developed
a system of succession planning to ensure smooth operations in the event of turnover.
4.3.3. Gas Supply Risk
Given the shortage of gas supply, several industries including the Power Sector faces gas load
shedding which results in lower dispatch.
The existing source of gas supply may deplete over the life of the Project which may render
the Company unable to continue operations.
Mitigating Factor:
The Company utilizes a unique source of gas i.e. permeate gas to generate power. Permeate
gas is supplied from the Qadirpur Gas field which was previously being flared. EPQL is
isolated from effects of gas curtailment due to overall gas shortage in the country.
In the event of depletion in gas reserves, the Company is allowed to comingle fuel i.e. run on
both gas and HSD and get an appropriate tariff. Further comfort can be taken from the fact that
under the terms of the Implementation Agreement (the terms of which are summarised in
paragraph 7.8) the GoP is obligated to allow the Company certain costs for alternate fuel
sources.
4.3.4. Gas Price Risk
An increase of gas price i.e. the primary business driver will result in lower profitability of the
Company and hence lower investor returns.
Mitigating Factor:
Subject with compliance with the efficiency provided in the tarrif, the tariff structure as
approved under the PPA, allows for certain increases in fuel prices to be passed-on to the
Power Purchaser.
4.3.5. Technology Risk
The power plant may face technological obsolescence and may be replaced with plants
operating on more efficient technology.
Page 30 of 72
Mitigating Factor:
Subject to the terms of the PPA, the Power Purchaser is obligated to purchase power from the
Company for a term of 25 years with predefined return on equity. The PPA also stipulates a
regressive efficiency structure which accounts for loss of efficiency due to usage.
4.3.6. Interest Rate Risk
Fluctuation in interest rate may have an adverse effect on the Company‟s profitability.
Mitigating Factor:
Cost of financing constitutes part of capacity payments in the PPA. Interest payment
components are indexed to variations in the respective benchmark interest rates i.e. KIBOR or
LIBOR.
4.3.7. Inflation Risk
Inflationary pressure will increase the operating costs for the Company thus reducing its
profitability.
Mitigating Factor:
Under the PPA, certain effects of inflation are adjusted for when determining the amount of
payments to be made to the Company by the Power Purchaser.
4.3.8. Liquidity Risk
Build-up of circular debt and the resultant liquidity constraint may render the Company unable
to honor its financial commitments.
Mitigating Factor:
The Company keeps a close watch on its liquidity through stringent internal controls. Financial
obligations are projected to determine the level of liquidity required which is arranged through
either internal cash generation or available credit lines.
4.3.9. Exchange Rate Risk
Risk of PKR depreciating against USD may result in variability of the Company‟s
profitability.
Mitigating Factor:

The tariff is adjusted by NEPRA to take into account fluctuations of USD/PKR exchange
rate during construction.

Foreign currency component of O&M costs, return on equity, interest payment and
principal repayment component are indexed to variations in the USD/PKR exchange rate.

GOP provides guarantee on availability of foreign currency, free transfer and repatriation
of funds under the Implementation Agreement.
Page 31 of 72

Under Power Policy 2002, the company is guaranteed a US dollar equity Internal Rate of
Return (“IRR”) of approximately 15%. Pakistan’s IPP’s have a unique return structure
in which they are insulated from fluctuations in fuel prices, interest rates and foreign
exchange rates. The tariff structure outlined in the Power Purchase Agreement (“PPA”)
ensures the IPPs of US dollar-denominated revenue streams, with equity returns pegged to
the US dollar, insulating cash flows from exchange rate movements.
4.3.10. Credit Risk
The Power Purchaser may be unable to clear its dues under the circular debt resulting in a loss
to the Company.
Mitigating Factor:
Receivables of Company under sale of electricity are secured against a GoP guarantee through
the Implementation Agreement. Additionally, being an IPP operating on gas, the Company
contributes one of the cheapest forms of power to the national grid. Hence, continued
operations of the Company are a matter of direct interest to the Power purchaser.
4.3.11. Litigation Risk
The litigations mentioned in section 7.10 may have an adverse impact on the Company.
Mitigating Factor:
Litigations against levy of Gas Infrastructure Development Cess (GIDC) and Worker Welfare
Fund (WWF) have no adverse impact on the Company since both are recoverable from Power
Purchaser as a „pass through‟ item.
For remaining litigation, the Company is confident, based on the advice from its legal counsel,
that chances of judgment against the Company are remote hence no provisions have been taken
into the financial statements of the Company.
4.3.12. Capital Markets Risk
The risk relates to the price performance of the share after the Company is listed.
Mitigating Factor:
The rise or fall in market prices is mainly governed by market forces. However, investor
sentiment is based on the fundamental value of the Company which is primarily dependent on
financial performance. Further, past performance is no guarantee of future returns but the
Company is likely to perform in future due to experienced management and strong group
profile.
4.3.13. Flood Risk
Floods may cause interruption in the operations of plant and damage the plant and machinery.
Mitigating Factor:
The Project facility is protected through plant walls and gates which are designed and built to
stop water ingress. Furthermore, all roads leading to the Project facility are surrounded by
Page 32 of 72
drain channels which collect the flood water at a common water pit built at the lowest
elevation of the plant.
4.3.14. Recovery of Insurance Claims
Timing and amount of insurance claim recovery may affect projected cash flows.
Mitigating Factor:
The insurance company was brought onboard from the onset of the problem to minimize their
turnaround time and all steps were taken after their concurrence of the malfunction of rotor in
2013. Accordingly, the Company is confident that the insurance claim will be recovered
during 2014.
4.3.15. Political Risk
Uncertain political conditions / political force majeure events may pose a threat to the
Company‟s profitability.
Mitigating Factor:
Pursuant to the Implementation Agreement, the Company is not liable for failure or delay in
performing certain obligations in case of certain political force majeure events.
Note:
IT IS STATED THAT ALL MATERIAL RISK FACTORS HAVE BEEN DISCLOSED
AND THAT NOTHING HAS BEEN CONCEALED IN THIS RESPECT.
Page 33 of 72
PART 5
5 FINANCIAL INFORMATION
5.1. AUDITORS’ REPORT UNDER SECTION 53(I) READ WITH CLAUSE 28 OF
SECTION 2 OF PART I OF THE SECOND SCHEDULE TO THE COMPANIES
ORDINANCE, 1984, FOR THE PURPOSE OF INCLUSION IN THE OFFER FOR
SALE DOCUMENT
Page 34 of 72
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5.2. SHARE BREAK-UP VALUE CERTIFICATE
Page 40 of 72
5.3. AUDITORS CERTIFICATE ON ISSUED, SUBSCRIBED, AND PAID – UP –
CAPITAL OF THE COMPANY
Page 41 of 72
Page 42 of 72
5.4. HALF YEAR AUDITED ACCOUNTS FOR THE PERIOD ENDED 30TH JUNE 2014
Page 43 of 72
Page 44 of 72
5.5. SUMMARY FINANCIAL HIGHLIGHTS
INCOME STATEMENT
PKR in Million
Revenue
Cost of Sales
Gross Profit
Profit from Operations
Financial Charges
Profit after Tax
Jun’14 (HY)
6,516
5,068
1,448
1,421
333
1,088
Dec’13
8,665
7,014
1,652
1,934
476
1,458
Dec’12
11,666
9,033
2,633
2,510
404
2,101
Dec’11
8,338
6,050
2,288
2,216
429
1,786
Dec’10
5,727
4,120
1,607
1,544
432
1,111
Jun’14 (HY)
6,075
14,416
6,281
20,697
6,324
8,298
14,622
Dec’13
5,523
15,337
3,696
19,033
3,923
9,586
13,510
Dec’12
6,758
14,969
9,396
24,365
7,474
10,133
17,607
Dec’11
5,110
14,564
6,048
20,611
5,038
10,464
15,502
Dec’10
4,193
14,393
4,228
18,621
3,464
10,964
14,427
Dec’13
19%
22%
17%
4.5
0.9
1.99
2.15
8%
26%
17.06
17.06
Dec’12
23%
22%
18%
6.49
1.3
1.68
2.03
9%
31%
20.87
20.87
Dec’11
27%
27%
21%
5.58
1.2
2.25
2.83
9%
35%
15.79
15.78
Dec’10
28%
27%
19%
3.47
1.2
2.83
3.27
6%
26%
13.10
12.96
BALANCE SHEET
PKR in Million
Equity
Non-Current Assets
Current Assets
Total Assets
Current Liabilities
Non-Current Liabilities
Total Liabilities
FINANCIAL RATIOS
PKR in Million
Gross Margin
Operating Margin
Net Margin
EPS
Current Ratio
Long Term Debt to Equity Ratio
Total Debt to Equity Ratio
Return on Assets
Return on Equity
Break Value per share
Break Value per share - Adjusted*
Jun’14 (HY)
22%
22%
17%
3.36
1.0
1.59
2.02
5%
18%
18.76
18.76
*adjusted for increase in number of shares in the following year
Page 45 of 72
PART 6
6 MANAGEMENT OF THE COMPANY
6.1. POLICY MATTERS
All policy-related matters are managed by the Board of Directors, headed by the Chairman of the
Board. At present, the Board comprises of 8 Directors including the CEO. The Directors are
elected by the shareholders in accordance with the relevant provisions of the Ordinance.
BOARD OF DIRECTORS & COMPANY SECRETARY OF THE COMPANY
S. No.
1
2
3
Name
Mr.
Muhammad
Aliuddin
Ansari
Mr. Syed
Muhammad
Ali
Mr. Ruhail
Mohammed
Address
8th Floor, The
Harbour Front
Building
HC # 3,
Marine Drive
Block 4,
Clifton,
Karachi
4th Floor, The
Harbour Front
Building
HC # 3,
Marine Drive
Block 4,
Clifton,
Karachi
7th Floor, The
Harbour Front
Building
HC # 3,
Marine Drive
Block 4,
Clifton,
Karachi
Designation
Directorship in other Companies (as on
June 30, 2014)








Director
CEO/Director
Director















Engro Powergen Limited
The Hub Power Company Limited
Laraib Energy Limited
GEL Utility Limited, Nigeria
Engro Power International Holding B.V.,
Netherlands







Engro Corporation Limited
Engro Vopak Terminal Limited
Engro Eximp (Private) Limited
Engro Fertilizers Limited
Engro Foods Limited
Engro Foundation (Trustee)
Pakistan Institute of Corporate
Governance
The Hub Power Company Limited

Page 46 of 72
Engro Corporation Limited
Engro Fertilizers Limited
Engro Eximp (Private) Limited
Engro Eximp AgriProducts (Private) Ltd.
Sindh Engro Coal Mining Company
Dewan Drilling Limited
Dewan Petroleum (Private) Limited
Pakistan Chemical & Energy Sector Skill
Development Company
Pakistan Business Council
Engro Vopak Terminal Limited
Engro Polymer & Chemicals Limited
Engro Foods Limited
Engro Powergen Limited
Elengy Terminal Pakistan Limited
Thar Power Company Limited
Engro Foundation (Trustee)
Engro Elengy Terminal (Private) Limited
Gel Utility Limited, Nigeria
S. No.
4
5
6
7
8
9
Name
Address
Ms. Aliya
Yusuf
Orr. Dignam
& Co. Bldg
No. 1-B, State
life Sq. I.I
Chundrigar
Road,
Karachi
Mr. Vaqar
Zakaria
Hagler Bailly
Pakistan (Pvt)
Ltd, 39, Street
3, E7,
Islamabad
Mr. Shabbir
Hashmi
Mr. Shahid
Hamid
Pracha
Mr. Javed
Akbar
Ms. Faryal
Mazhar
Habib
House No.
90/1
Street No. 11
Kh-e- Sehar,
DHA, Phase 6
Karachi
16-B, 3rd
Central Lane,
Phase II,
DHA,
Karachi
75/1/1 Street
15,
Kh-e-Sehar,
Phase 6, DHA
Karachi.
8th Floor, The
Harbour Front
Building
HC # 3,
Marine Drive
Block 4,
Clifton,
Karachi
Designation
Director
Director
Directorship in other Companies
(as on June 30, 2014)




Engro Powergen Limited
First Micro Finance Bank Limited
APWA Endowment Trust
Colgate Palmolive (Pakistan) Limited




Hagler Bailly Pakistan
Himalayan Wildlife Foundation
Engro Powergen Limited
Pakistan Foundation Fighting Blindness,
Member Board of Trustees
National Transmission and Dispatch
Company Ltd

Director









Engro Corporation Limited
Engro Fertilizers Limited
Engro Powergen Limited
LMKR Holdings (Private) Limited
Sindh Engro Coal Mining Company
Limited
UBL Fund Managers
Thar Power Company Limited
The Helpcare Society
The Hub Power Company Limited









Engro Corporation Limited
Engro Powergen Limited
Engro Fertilizers limited
DH Fertilizers Limited
Tenaga Generasi Limited
Dawood Lawrencepur Limited
Dawood Hercules Corporation Limited
The Hub Power Company Limited
e2e Business Enterprises (Private)
Limited
Director







Engro Vopak Terminal Limited
Dawood Hercules Chemical Limited
Javed Akbar Associates (Private) Limited
DH Fertilizers Limited
Pakistan Petroleum Limited
Engro Fertilizers Limited
Engro Powergen Limited
Company
Secretary




Engro Powergen Limited
Engro Vopak Terminal Limited
Elengy Terminal Pakistan Limited.
Engro Elengy Terminal (Pvt) Limited.
Director
Page 47 of 72
6.2. OVER DUE LOANS
There are no overdue loans (local or foreign currency) on the Company or its Directors.
6.3. DIVIDEND PAYOUT
Dividend payout of the Company since the last four (4) years from 2010 is as below:
Cash Dividend
Bonus
Payout Ratio
Jun’14 (HY)
15.4%
46%
Dec’13
61.7%
137%
Dec’12
35.5%
55%
Dec’11
28.6%
51%
Dec’10*
-
* 2010 was the first year of commercial operations.
6.4. DIVIDEND PAYOUT OF ASSOCIATED COMPANIES
2013
2012
2011
2010
2009
Engro Corporation Limited (December Year-end)
Dividend per share
Note 1
6.0
6.0
6.0
Bonus
0%
0%
30%
20%
10%
Engro Fertilizers Limited (December Year-end)
Dividend per share
not applicable
Bonus
Engro Foods Limited (December Year-end)
Dividend per share
not applicable
Bonus
0%
0%
0%
Engro Polymer & Chemicals Limited (December Year-end)
Dividend per share
Bonus
0%
0%
0%
0%
0%
Dawood Hercules Limited (December Year-end)
Dividend per share
1.0
1.0
1.0
5.0
4.0
Bonus
0%
0%
0%
300%
10%
Dawood Lawrencepur Limited (December Year-end)
Dividend per share
1.0
5.0
1.0
0.5
Bonus
0%
0%
0%
15%
0%
The Hub Power Company Limited (June Year-end)
Dividend per share
8.0
6.0
5.5
5.0
3.35
Bonus
0%
0%
0%
0%
0%
Lotte Chemicals Pakistan Limited (December Year-end)
Dividend per share
0.5
0.5
0.5
Bonus
0%
0%
0%
0%
0%
Pakistan Petroleum Limited (June Year-end)
Dividend per share
10.5
11.5
12.0
9.0
13.0
Bonus
20%
25%
10%
20%
20%
Colgate Palmolive (Pakistan) Limited (June Year-end)
Dividend per share
14.0
14.0
14.0
13.50
11.50
Bonus
10%
20%
15%
15%
15%
Cyan Limited (December Year-end)
Dividend per share
10.0
4.0
2.5
2.5
2.0
Bonus
0%
50%
0%
50%
25%
Note 1: specie dividend of 1 share of Engro Fertilizers Limited for every 10 shares of Engro Corporation Limited
Note 2: the above table shows only post-listing payouts
Page 48 of 72
6.5. PROFILE OF DIRECTORS
Mr. Muhammad Aliuddin Ansari - Chairman
Muhammad Aliuddin Ansari is the President & Chief Executive Officer of Engro Corporation
Limited since May 2012. He is a graduate of Business Administration with a specialization in
Finance & Investments. Ali started his career as an Investment Manager at Bank of America in
London which later became World Invest after a management buyout. He has also worked as CEO
Pakistan and later as COO Emerging Europe for Credit Lyonnais Securities Asia. He has also
worked as CEO AKD Securities and was instrumental in launching Online Trading, Venture
Capital and Private Equity investments in Pakistan. In 2006 he partnered with an Oil & Gas
company to form Dewan Drilling, Pakistan‟s first independent drilling company which he led as its
CEO before joining Engro.
Ali is a member of the Board of Directors of various companies details of which are given in
paragraph 6.1 above. He has chaired a number of SECP committees and also served on the Boards
of the Karachi Stock Exchange, NCCPL, Lucky Cement and Al-Meezan Investment Management
amongst others. He joined the Corp Board in 2009.
Mr. Syed Muhammad Ali - Chief Executive Officer / Director
Mr. Syed Mohammed Ali is the Chief Executive Officer of the Company since November 2011.
Before that he has held various key assignments of Engro Corporation Limited. He joined Engro
Fertilizers Limited in the year 2000. He is a director on the Board of Engro Powergen Qadirpur
Limited, Engro Powergen Limited, The Hub Power Company Limited, GEL Utility Limited, Engro
Power International Holding B.V., Netherlands & Laraib Energy Limited. Ali has done his
bachelor‟s in Electrical Engineering from UET Lahore in 1995.
Mr. Ruhail Mohammed - Director
Ruhail Mohammed is currently the Chief Executive Officer of Engro Fertilizers Limited. Prior to
his current position, he was the Chief Financial Officer of Engro Corporation Limited and also the
Chief Executive Officer of Engro Powergen Limited. He holds an MBA degree in Finance from the
Institute of Business Administration, Karachi, and is also a Chartered Financial Analyst.
Ruhail has 25 years of Financial & Commercial experience and prior to becoming CEO of Engro
Fertilizers Limited has worked in areas such as treasury, commodity & currency trading,
derivatives, mergers & acquisitions, risk management, strategy & financial planning. He has
worked in these areas in Pakistan, UAE and Europe.
He is on the Board of Engro Corporation Limited and its various subsidiaries. In addition, he is also
on the Boards of Cyan Limited, Hub Power Company Limited & Pakistan Institute of Corporate
Governance.
Mr. Vaqar Zakaria - Director
Mr. Vaqar Zakaria has over 35 years experience in energy and environmental management in
Pakistan and in the region. His professional focus has been on business policy and strategy
evaluation, planning of energy production and distribution systems, energy pricing, demand
forecasting, and environmental assessment of energy projects. With private sector firms, he has
been extensively involved in power, and oil and gas infrastructure projects, including conceptual
planning, engineering and project management. He has assisted the Planning Commission, energy
ministries, state owned utilities, the World Bank, the Asian Development Bank, and the private
sector in the development of energy infrastructure, policies to promote investment in the energy
sector, and in formulating short and long-term energy plans. Vaqar played a key role in setting up
Hagler Bailly Pakistan in 1990, where he continues to oversee all organizational matters. He has
also been instrumental in establishing the Himalayan Wildlife Project, an NGO active in setting up
national parks and assisting the communities and government in management of the protected
Page 49 of 72
areas. He holds a bachelor‟s and master‟s degrees in Chemical Engineering from the
Massachusetts Institute of Technology (MIT), USA.
Ms. Aliya Yusuf - Director
Ms. Aliya Yusuf is a Partner of Orr Dignam & Co. based in the Firm‟s Karachi office. She obtained
her law degree from the University of Cambridge and is a Barrister from Gray‟s Inn. As with other
Partners of the Firm, she deals with a wide range of corporate, financial and commercial matters.
Her focus areas are M&A (including privatization) and project work, joint ventures and in the
energy, pharmaceutical and communication sectors and real estate development.
Mr. Shabbir Hashmi - Director
Mr. Shabbir Hashmi has more than 30 years of project finance and private equity experience. He
had led the Pakistan operations at Actis Capital, one of the largest private equity investors in the
emerging market.
Prior to Actis, he was responsible for a large regional portfolio of CDC Group Plc for Pakistan and
Bangladesh. He also had a long stint with USAID and later briefly with the World Bank in Pakistan,
specializing in planning and development of energy sector of the country. Apart from holding more
than 24 board directorships as a nominee of CDC/Actis in the past, he is currently serving as an
independent director on several companies from manufacturing to financial services. He is also on
the board of governors of The Help Care Society which is operating K-12 schools in Lahore for
underprivileged children.
He is an engineer from Dawood College of Engineering & Technology, Pakistan and holds an MBA
from J.F. Kennedy University, USA. He has been serving as an independent director on the board
since 2006.
Mr. Shahid Hamid Pracha - Director
Mr. Pracha is Chief Executive of Dawood Hercules Corporation Limited and Chairman of DH
Fertilizers Limited, Dawood Lawrencepur Limited, and Tenaga Generasi Limited. He is also a
Director on the Boards of HUBCO, Engro Corporation Limited, Engro Fertilizers Limited, e2e
Business Enterprises (Private) Limited, Engro Powergen Limited and Engro Powergen Qadirpur
Limited He previously served as Chief Executive of the Dawood Foundation, the philanthropic arm
of the Dawood Hercules Group.
Mr. Pracha is a graduate electrical engineer from the University of Salford, UK and prior to joining
the Dawood Group, spent a major part of his career with ICI Plc‟s Pakistan operations in a variety
of senior roles including a period of international secondment with the parent company in the UK.
He is also a founding member of the Pakistan Society for Human Resource Managers and
previously served as the first CEO of the Karachi Education Initiative, the sponsoring entity of the
Karachi School for Business & Leadership. He joined the Engro Fertilizers Board in 2012.
Mr. Javed Akbar - Director
He has a Master‟s degree in Chemical Engineering from United Kingdom and has over 35 years
experience in fertilizer and chemical business with Exxon, Engro and Vopak. He has managed
Exxon and Engro Fertilizer plants and their expansions in Pakistan, worked in Exxon‟s Chemical
Technology divisions in USA and Canada, and served as HR Manager in Exxon Pakistan. He was
part of the buyout team when Exxon divested its stake in Engro.
Prior to his retirement in 2006, Javed Akbar was Chief Executive of Engro Vopak Terminal
Limited, a joint venture between Engro and Royal Vopak of Holland. After his retirement, he
established a consulting company specializing in analyzing and forecasting petroleum,
petrochemical and energy industry trends and providing strategic insight.
Page 50 of 72
He also serves on the Board of Directors of Dawood Hercules Corporation Limited, DH Fertilizers
Limited, Engro Fertilizers Limited, Engro Powergen Limited, Engro Powergen Qadirpur Limited,
Engro Vopak Terminal Limited, Javed Akbar Associates (Private) Limited, Pakistan Petroleum
Limited and is also on the panel of environmental experts of Sindh Environmental Protection
Agency.
6.6. PROFILE OF MANAGEMENT
Mr. Syed Muhammad Ali - Chief Executive Officer
Please refer paragraph 6.5 above.
Mr. Atif Kaludi - Chief Financial Officer
Atif Kaludi is Chief Financial Officer at EPQL. As CFO, Atif is heading the Finance & Planning,
Accounting, Commercial and Procurement teams.
He is a Chartered Accountant by qualification and completed his training from Ernst & Young
Pakistan in 2004. He then worked as Assistance Vice President Finance at TPL Holdings till 2007.
Atif became a part of Engro group in 2007 starting with Engro Polymer & Chemicals Ltd (EPCL).
He also worked in the supply chain function at EPCL for 2 years before moving to EPQL in 2012.
Ms. Faryal Mazhar Habib - Company Secretary
Faryal Mazhar Habib is the Company Secretary at EPQL. Faryal handles all company secretarial
work along with handling all legal in-house work relating to EPQL. She is an Advocate of the High
Court and holds a Bachelor of Law (LL.B) from the University of London and a Masters of Laws
(LL.M) from the University of Aberdeen specializing in oil and gas law. Faryal has been practicing
since 2004 and became part of Engro Group in 2013.
Mr. Syed Shahzad Nabi - General Manager Plant
Mr. Syed Shahzad Nabi is the GM Plant of Engro Powergen Qadirpur Limited since September
2013. Prior to his current position, he has handled various key assignments at Engro Fertilizers &
Engro Polymers in different capacities. He is a graduate in Mechanical Engineering from NED
University Karachi.
Mr. Farooq Nazim Shah - Senior Engineering Manager
Mr. Farooq Nazim Shah is the Senior Engineering Manager of Engro Powergen Qadirpur Limited
since November 2012. Before that he has handled various key assignments at Engro Fertilizers
Limited. He joined Engro Fertilizers Limited in the year 1992. Farooq has an overall experience of
more than 20 years at various Technical, Large Projects, Business Development and administrative
positions. Farooq has done his bachelor‟s in Electrical Engineering from NED University of
Engineering & Technology, Karachi in 1990.
Mr. Raja Ashfaq - Production Manager
Mr. Raja Ashfaq Ahmed is associated with Engro Powergen Qadirpur Limited since March 2008 as
Production Manager. He took responsibilities before the construction of plant and has been involved
in engineering review of the plant.
After construction of the plant he led testing and commissioning of the plant till COD. Before that
he was working with International Power as Shift Manager since May, 1995. In 1995, the 4 X 323
MW power plants were under construction. Mr. Ashfaq worked actively in commissioning of four
units which completed in March 1996. Mr. Ashfaq has a total experience of nearly 34 years of
Operation of plant.
Page 51 of 72
6.7. NUMBER OF DIRECTORS
Pursuant to Section 174 of the Ordinance, the number of directors of the Company shall not be less
than seven (7). The Board consists of 8 Directors as detailed in paragraph 6.1 above.
6.8. QUALIFICATION OF DIRECTORS
A Director must be a member unless he is a person representing the Government or an institution
or the Securities & Exchange Commission that is a member, or is a whole time working director
who is an employee of the Company, or a Chief Executive or a person representing a creditor.
6.9. APPOINTMENT/ ELECTION OF DIRECTORS
The Directors shall comply with the provisions of Sections 174 to 178, 180, and 184 of the
Ordinance, relating to the election of Directors and matters ancillary thereto. The present Directors
of the Company were duly elected on October 15th, 2013 for a term of three years.
6.10. BENEFITS OF PROMOTERS AND OFFICERS DURING THE LAST TWO YEARS
No amount or benefit has been paid or given within the last two years or is intended to be given to
any promoter/ or officer of the Company otherwise than as remuneration for services rendered as
full-time executives of the Company.
6.11. REMUNERATION OF THE DIRECTORS
The remuneration to be paid to the Directors for attending the meetings of the Directors or a
committee of Directors shall be determined by the Board from time to time, provided that a
Director who is an executive of the Company shall not be entitled to any remuneration for
attending meetings of the Board or a Committee of the Board. The Directors may also be paid all
travelling, hotel and other expenses, properly incurred by them in attending and retuning from
meetings of the Directors or any committee of the Directors or general meetings of the Company or
in connection with the business of the Company. Where a Director or a firm of which such Director
is a partner or a private company of which such Director is a director holds an office of profit under
the Company other than the office of Chief Executive or an office as legal or technical advisor or
banker, the terms of remuneration for such office shall be sanctioned by an Ordinary Resolution of
the Company, except that remuneration of directors who are executives of the Company shall be
decided by the Board of Directors.
6.12. INTEREST OF DIRECTORS IN THE COMPANY
The directors may be deemed to be interested to the extent of fees payable to them for attending
Board meetings. The directors performing whole time service to the Company may also be deemed
interested in the remuneration payable to them from the Company. The directors may also be
deemed to be interested, to the extent of any shares held by each of them in the Company and the
dividends to be declared on their shareholding in the Company.
6.13. INTEREST OF DIRECTORS IN PROPERTY ACQUIRED BY THE COMPANY
None of the directors of the Company had or have any interest in any property acquired by the
Company within the last two years or now proposed to be acquired by the Company.
Page 52 of 72
6.14. VOTING RIGHTS
The rights and privileges, including voting rights, attached to the ordinary shares of the Company
are equal.
6.15. AUDIT COMMITTEE/CONSTRUCTION OF AUDIT COMMITTEE
An Audit Committee of the Board has been formed to comply with the Code of Corporate
Governance, which comprises of the following:

Mr. Shahid Hamid Pracha

Mr. Shabbir Hashmi

Ms. Aliya Yusuf
The audit committee meetings are held on a quarterly basis, as per provisions of the Code of
Corporate Governance. The Committee has its terms of reference which were determined by the
Board of Directors in accordance with the guidelines provided in the Listing Regulations.
6.16. INTERNAL AUDIT
The Board has setup an effective internal audit function managed by suitably qualified and
experienced personnel who are conversant with the policies and procedures of the Company and
are involved in the internal audit function on a full time basis. Internal Audit Department is headed
by Mr. Jaseem Ahmed Khan. Jaseem completed his Chartered Accountancy from ICAP in 2006.
He is also CISA qualified and has held various senior positions in PSO, ORIX and Al-Meezan
Investment Management Limited.
6.17. POWERS OF DIRECTORS
The business of the Company shall be managed by the Directors who may pay all expenses
incurred in setting up and registering the Company and may exercise all such powers of the
Company as are not by the Ordinance or by any other law or the Articles of Association of the
Company, required to be exercised by the Company in General Meeting but no regulation made by
the Company in General Meeting shall invalidate any prior act of the Directors which would have
been valid if that regulation had not been made.
6.18. BORROWING POWERS OF DIRECTORS
Subject to the provisions contained in the Articles of Association of the Company, the Directors
may exercise all the powers of the Company to borrow money and to mortgage or charge its
undertaking and property, or any part thereof, and to issue securities and debentures whether
outright or as security for any debt, liability or obligation of the Company or of any third party.
6.19. INDEMNITY
Every Director or officer of the Company and every person employed by the Company as auditor
shall be indemnified out of the funds of the Company against all liability incurred by him as such
Director, officer or auditor in defending any proceedings, whether civil or criminal, in which
judgment is given in his favor, or in which he is acquitted, or in connection with any application
under the relevant provisions of the Ordinance in which relief is granted to him by the court.
Page 53 of 72
6.20. INVESTMENT IN ASSOCIATED COMPANIES
The Company has not made any investment in any of associated companies nor has any resolution
been passed for investment in associated companies under Section 208 of the Ordinance.
6.21. INVESTMENT IN SUBSIDIARIES
The Company has not sponsored nor acquired any subsidiaries nor has any resolution been passed
for sponsoring or acquiring any subsidiaries under Section 208 of the Ordinance.
Page 54 of 72
PART 7
7 MISCELLANEOUS INFORMATION
Engro Powergen Qadirpur Limited
4th Floor, The Harbor Front Building
HC-3, Marine Drive, Block 4, Clifton
Karachi - 75600, Pakistan
Website: www.engropowergen.com
7.
7.1. REGISTERED OFFICE
01 Allied Bank Limited
02 Askari Bank Limited
03 Bank Alfalah Limited
7.2. BANKERS TO OFFER
04 Faysal Bank Limited
05 Habib Bank Limited
06 Habib Metropolitan Bank Limited
07 JS Bank Limited
08 MCB Bank Limited
09 NIB Bank Limited
10 Samba Bank Limited
11 Silk Bank Limited
12 United Bank Limited
01 Allied Bank Limited
02 Bank Alfalah Limited
03 Bank of Punjab Limited
04 Burj Bank Limited
05 Habib Allied International Bank, London
06 Habib Metropolitan Bank Limited
07 KASB Bank Limited
08 National Bank of Pakistan Limited
09 NIB Bank Limited
10 Soneri Bank Limited
7.3. BANKERS TO THE COMPANY
A. F. Fergusons & Co., Chartered
Accountants
State Life Building No. 1-C
I.I. Chundrigar Road
P.O. Box 4716
Karachi
7.4. AUDITORS
7.5. LEGAL ADVISOR TO THE COMPANY & THE Haidermota BNR& Co.
D-79, Block 5
OFFER
Clifton, Karachi
7.6. COMPUTER
REGISTRAR
BALLOTER
AND
FAMCO Associates (Pvt) Ltd.
SHARES State Life Building No. 1-A
I.I. Chundrigar Road
Karachi
7.7. FINANCIAL ADVISORS AND LEAD MANAGERS
Page 55 of 72
Habib Bank Limited
01-HBL Plaza,
I.I. Chundrigar Road, Karachi
Ph: 021-32418000 Ext. 2741
Fax: 021 32435914
Email: khurram.khan@hbl.com
Website: www.hbl.com
Bank Alfalah Limited
B.A. Building
I.I. Chundrigar Road,
Karachi.
Email:Imitiaz.gadar@bankalfalah.com
Website: www.bankalfalah.com
7.8. MATERIAL CONTRACTS / DOCUMENTS
7.8.1. Underwriting Agreements
Underwriter
No. of shares
Habib Bank Limited
Bank Alfalah Limited
20,237,500
20,237,500
Amount (PKR)
607,529,750
607,529,750
Date
th
28 July, 2014
28th July, 2014
7.8.2. Due Diligence Reports of the Underwriters
Underwriter
Date
28th July, 2014
28th July, 2014
Habib Bank Limited
Bank Alfalah Limited
7.8.3. Private Placement Agreements
Agreement
Share Subscription Agreement
Private Placement Agreement
Private Placement Agreement
Private Placement Agreement
Private Placement Agreement
Private Placement Agreement
Private Placement Agreement
Private Placement Agreement
Private Placement Agreement
Private Placement Agreement
Private Placement Agreement
Private Placement Agreement
Private Placement Agreement
Private Placement Agreement
Private Placement Agreement
Private Placement Agreement
Date
September 22, 2008
July 22nd, 2014
July 22nd, 2014
July 22nd, 2014
July 23rd, 2014
July 23rd, 2014
July 23rd, 2014
July 23rd, 2014
July 23rd, 2014
July 23rd, 2014
July 23th, 2014
July 24th, 2014
July 24th, 2014
July 24th, 2014
July 24th, 2014
August 7th, 2014
Counter Party
International Finance Corporation
Swift Textile Mills (Pvt.) Ltd.
Jubilee Life Insurance Co. Ltd.
Metro Securities (Pvt.) Ltd.
Moosani Securities (Pvt.) Ltd.
Liberty Mills Ltd.
Liberty Power Tech Ltd.
Shakoo (Pvt.) Ltd.
Westbury (Pvt.) Ltd.
Bulk Management (Pakistan) Pvt. Ltd.
Bank Alfalah Limited
Habib Bank AG Zurich
Habib Bank AG Zurich,UAE
Elahi Electronics
Almurtaza Machinery (Pvt.) Limited
Employees of the Company and Engro Group
7.8.4. Material Agreements
Agreements
Date
Counterparty
Generation License
Power Purchase Agreement
Jul 26, 2007
Oct 26, 2007
Implementation Agreement
Oct 29, 2007
NEPRA
NTDC
President, Islamic Republic of
Pakistan
Sui Northern Gas Company
Limited
China Tianchen Chemical
Gas Supply Agreement
Supply (Engineering and
Apr 22, 2008 and amended on Oct
8, 2008
Oct 4, 2007
Page 56 of 72
Procurement) Contract
Construction Contract
Engineering Corporation
China National Construction and
Engineering Company
Oct 4, 2007
7.8.5. Long Term Financing Agreements
Bank
Date
International Finance Corporation (IFC)
DEG of Germany (DFI)
FMO of Netherland (DFI)
Proparco of France (DFI)
Swedfund of Sweden (DFI)
OPEC
Fund
for
Development (OFID)
International
Facility
Amount
(USD in
Millions)
Balance as
of 31
Dec’13
19/12/2007
53.1
39.21
19/12/2007
18.7
13.50
19/12/2007
26
18.76
19/12/2007
21.9
15.81
19/12/2007
12.2
8.8
19/12/2007
12.1
8.93
Mark-up
Rate
6M LIBOR
+ 3%
6M LIBOR
+ 3%
6M LIBOR
+ 3%
6M LIBOR
+ 3%
6M LIBOR
+ 3%
6M LIBOR
+ 3%
Note: The borrowing is secured by an equitable mortgage on the immovable property and the hypothecation of current and future
assets of the company, expect receivables from NTDC in respect of Energy Purchase Price.
7.8.6. Short Term Financing Agreements
Bank
Facility Amount
(PKR in
Millions)
Balance as of
31 Dec’13
1,000
50
500
500
50
300
250
500
182
50
300
50
50
250
-
Allied Bank Limited
KASB Bank Limited
NIB Bank Limited
Soneri Bank Limited
Habib Metropolitan Bank Limited
Bank of Punjab Limited
Bank Alfalah Limited
Pak Kuwait Investment Company
(Pvt.) Limited
Mark-up
Rate
3M KIBOR + 2%
3M KIBOR + 2%
3M KIBOR + 2%
3M KIBOR + 2%
3M KIBOR + 2%
3M KIBOR + 2%
3M KIBOR + 2%
3M KIBOR + 2%
Note: The facilities are secured by, (i) lien over Energy Purchase Price (EPP) account and charge over present and future receivables
from the Power Purchaser in respect of EPP, and (ii) first charge over current assets of the Company and subordinated charge over
present and future plant, machinery, equipment and other movables assets and immovable properties of the Company.
Summary of Material Contracts
Power Purchase Agreement (PPA) dated 26th October 2007
The PPA has been signed between NTDC (through its Central Power Purchasing Agency on behalf
of ex-WAPDA Distribution Companies) and Engro Powergen Qadirpur Limited (previously Engro
Energy Ltd.) on 26th October 2007 having a term of 25 years. The Company commenced its
commercial operation on 27th March, 2010.
PPA sets out the principal terms and conditions for the Capacity and Energy payments by CPPA.
The Company is required to declare availability of its plant to NTDC up to the Tested Capacity.
The tariff is payable by CPPA in respect to each unit of generated electricity and/or made
available.
Page 57 of 72
For each month, Capacity Payment is to be paid in advance equal to the Capacity Purchase Price
(CPP) in effect for that month at 70% of the Tested Capacity. The remaining 30% Capacity is
billed in following month for the actual capacity established.
Capacity Payment is also payable for the capacity then unavailable during any period during which
the Complex is undergoing a forced or partial forced outage up to 348 hours in a year and during
the period when it is undergoing an approved schedule outage. The allowed schedule outages to the
Company in each year is 21 Days for the combustion inspection, 26 Days for the hot gas path
inspection (every third year), except in any year in which a Major Overhaul (every sixth year) is
required in which case the Company is entitled to 60 Days.
For each month, Energy Payment is to be paid equal to the product of Energy Purchase Price (EPP)
and the number of KWh of electricity delivered to NTDC during that month.
Implementation Agreement (IA) with GOP/ PPIB dated 29th October 2007
The Implementation Agreement has been signed between the Islamic Republic of Pakistan (GoP)
through Private Power Infrastructure Board (PPIB) and Engro Powergen Qadirpur Limited
(previously Engro Energy Ltd.) on 29th October 2007. IA provides the following provisions:

GoP provides guarantee for the payment obligations of Power Purchaser.

Gas Reservoir Risk:
― Loan/equity of the project will not be affected as financial cost of alternate fuel option
will be passed on to GOP/NTDC.

Taxation:
― No income tax
― No Sales Tax on Imports before COD
Gas Supply Agreement (GSA) with SNGPL / OGDCL dated 22nd April 2008
The Gas Supply Agreement “GSA” had been signed between the Sui Northern Gas Pipelines
Limited “SNGPL” referred to as “Seller” and Engro Powergen Qadirpur Limited (previously
Engro Energy Ltd.) referred to as “Buyer” on 22nd April, 2008. SNGPL in turn has a back to back
agreement with Oil and Gas Development Company Limited “OGDCL” referred to as “Gas
Producer” for the supply of 75 MMSCFD gas from Qadirpur Gas Field.
The term of this agreement is for a period of 25 years, subject to availability of Permeate gas.
An Amendment No 1 to GSA has been executed out on 8th October, 2008 for adjustments in
calorific value of gas then made available to the power plant.
The gas is a low BTU gas having high contents of Hydrogen Sulphide “permeate gas” and was
previously being flared at the Qadirpur gas field.
The Daily Contract Quantity (DCQ) is 46,000MMBTU/Day. The contract allows 36 days of
outage allowance for schedule and unscheduled outages of Seller & Gas Producer. Subject to a
cap, the Company is financially protected against non-supply of gas beyond the allowed outage
allowance.
Page 58 of 72
GOP Guarantee dated 30thApril 2008
The GOP guarantee was signed between the Company and the Government of Pakistan on
30thApril 2008. Under this agreement the GOP irrevocably and unconditionally guarantees and
promises to pay to the Company any and every sum of money which WAPDA and Gas Supplier
are obligated to pay to the Company under or pursuant to the Power Purchase Agreement and Gas
Supply Agreement, which they have failed to pay under the terms of the aforementioned
agreements.
7.9. INSPECTION OF DOCUMENTS AND CONTRACTS
Copies of the Memorandum and Articles of Association, the audited financial statements, the
Auditor‟s Certificates, Information Memorandum and copies of agreements referred to in this
OFSD may be inspected during usual business hours on any working day at the registered office of
the Company from the date of publication of this OFSD until the closing of the subscription list.
7.10. LEGAL PROCEEDINGS
Details of legal proceedings pending against the Company or initiated by the Company, involving
material financial implications is as provided below:

EPQL vs. Federation of Pakistan, through Ministry of Law and Justice [WP 847 of 2014]
pending before the Lahore High Court.
The Respondents have claimed an amount of PKR 1,462,314,674 as Gas Infrastructure
Development Cess for the billing period 1.1.13 to 31.12.13. Levy of GIDC and the recovery
for the referred period is under challenge and due to the stay order granted by the Court, the
Respondents have been restrained from recovering GIDC from the consumers. Interim stay
order has been granted and is intact. However, GIDC if charged will be recovered by the
Company as pass through item from NTDC under the approved tariff.

EPQL & Others vs. Federal Board of Revenue pending before the Sindh High Court at
Karachi.
Writ Petition filed in the Sindh High Court challenging the levy of WWF. All Engro petitions
have been clubbed together. Orders have also been passed restraining the FBR from recovery
of demands.
7.11. MEMORANDUM OF ASSOCIATION
The Memorandum of Association, inter alia, contains the objects for which the Company was
incorporated and the business which the Company is authorized to undertake. A copy of the
Memorandum of Association is annexed to this OFSD and with every issue of the OFSD except the
one that is released in newspapers as advertisement.
7.12. FINANCIAL YEAR OF THE COMPANY
The financial year of the Company commences on January 1st and ends on December 31steach year.
7.13. CAPITALIZATION
The Company has not capitalized any profits till the date of publication.
Page 59 of 72
PART 8
8 APPLICATION AND ALLOTMENT INSTRUCTIONS
8.1. GENERAL INSTRUCTIONS
8.1.1
Eligible investors include:
a. Pakistani citizens resident in or outside Pakistan or Persons holding two nationalities
including Pakistani nationality;
b. Foreign Nationals whether living in or outside Pakistan;
c. Companies, bodies corporate or other legal entities incorporated or established in or
outside Pakistan (to the extent permitted by their constitutive documents and existing
regulations, as the case may be);
d. Mutual Funds, Provident/pension/gratuity funds/trusts, (subject to the terms of the Trust
Deed and existing regulations); and
e. Branches in Pakistan of companies and bodies corporate incorporated outside Pakistan.
8.1.2
APPLICATION MUST BE MADE ON THE COMMISSION’S APPROVED
APPLICATION FORM OR A LEGIBLE PHOTOCOPY THEREOF ON A PAPER
OF A4 SIZE WEIGHING ATLEAST 62 GM.
8.1.3
Copies of this OFSD and applications forms can be obtained from members of Karachi
Stock Exchange Limited, Lahore Stock Exchange Limited and Islamabad Stock Exchange
Limited, the Bankers to the Offer and their Branches, the Lead Managers and the registered
office of the Company. The OFSD and the Application Form can also be downloaded from
the following website: www.engropowergen.com.
8.1.4
The applicants opting for scripless form of shares are required to complete the relevant
sections of the application. In accordance with the provisions of the Central Depositories
Act, 1997 and the CDCPL Regulations, credit of such shares is allowed ONLY in the
applicant‟s own CDC account. In case of discrepancy between the information provided in
the application form and the information already held by CDS, the Company reserves the
right to issue shares in physical form.
8.1.5
Name(s) and address(es) must be written in full block letters, in English and should not be
abbreviated.
8.1.6
All applications must bear the name and signature corresponding with that recorded with
the applicant's banker. In case of difference of signature with the bank and Computerized
National Identity Card (CNIC) or National Identity Card for Overseas Pakistanis (NICOP)
or Passport both the signatures should be affixed on the application form.
8.1.7
APPLICATIONS MADE BY INDIVIDUAL INVESTORS
(i) In case of individual investors, an attested photocopy of CNIC (in case of Resident
Pakistanis)/Passport (in case of Non-Resident Pakistanis) as the case may be, should
be enclosed and the number of CNIC/Passport should be written against the name of
the applicant. Copy of these documents can be attested by any Federal/Provincial
Page 60 of 72
Government Gazetted Officer, Councilor, Oath Commissioner or Head Master of
High School or bank manager in the country of applicant's residence.
(ii) Original CNIC/Passport, along with one attested photocopy, must be produced for
verification to the Banker to the Offer and the applicant's banker (if different from the
Banker to the Offer) at the time of presenting the application. The attested photocopy
will, after verification, be retained by the bank branch along with the application.
8.1.8
APPLICATIONS MADE BY INSTITUTIONAL INVESTORS
(i) Applications made by companies, corporate bodies, mutual funds,
provident/pension/gratuity funds/trusts and other legal entities must be accompanied
by an attested photocopy of their Memorandum and Articles of Association or
equivalent instrument/document. Where applications are made by virtue of Power of
Attorney, the same should also be submitted along with the application. Any
Federal/Provincial Government Gazetted Officer, Councilor, Bank Manager, Oath
Commissioner and Head Master of High School or bank manager in the country of
applicant's residence can attest copies of such documents.
(ii) Attested photocopies of the documents mentioned in paragraph 8.1.8 (i) must be
produced for verification to the Banker to the Offer and the applicant's banker (if
different from the banker to the Offer) at the time of presenting the application. The
attested copies, will after verification, be retained by the bank branch along with the
application.
8.1.9
Only one application will be accepted against each account, however, in case of joint
account, one application may be submitted in the name of each joint account holder.
8.1.10 Joint application in the name of more than two persons will not be accepted. In case of joint
application each applicant must sign the application form and submit attested copies of their
CNICs/Passport. The Shares will be dispatched to the person whose name appears first on
the application form while in case of CDS, it will be credited to the CDS account mentioned
on the face of the form and where any amount is refundable, in whole or in part, the same
will be refunded by cheque or other means by post, or through the bank where the
application was submitted, to the person named first on the application form, without
interest, profit or return. Please note that joint application will be considered as a single
application for the purpose of allotment of Shares.
8.1.11 Subscription money must be paid by cheque drawn on applicant's own bank account or pay
order/bank draft payable to one of the Bankers to the Offer in favor of account “PUBLIC
OFS OF SHARES OF EPQL” and crossed “A/C PAYEE ONLY”.
8.1.12 For the applications made through pay order/bank draft, it would be permissible for a
Banker to the Offer to deduct the bank charges while making refund of subscription money
to unsuccessful applicants through pay order/bank draft individually for each application.
8.1.13 The applicant should have at least one bank account with any of the commercial
banks. The applicants not having a bank account at all (non-account holders) are not
allowed to submit application for subscription of Shares.
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8.1.14 Applications are not to be made by minors and/or persons of unsound mind.
8.1.15 Applicants should ensure that the bank branch, to which the application is submitted,
completes the relevant portion of the application form.
8.1.16 Applicants should retain the bottom portion of their application forms as provisional
acknowledgement of submission of their applications. This should not be construed as an
acceptance of the application or a guarantee that the applicant will be allotted the number of
Shares for which the application has been made.
8.1.17 Making of any false statements in the application or willfully embodying incorrect
information therein shall make the application fictitious and the applicant or the bank
shall be liable for legal action.
8.1.18 Bankers to the Offer are prohibited to recover any charges from the subscribers for
collecting subscription applications. Hence, the applicants are advised not to pay any extra
charges to the Bankers to the Offer.
8.1.19 It would be permissible for a Banker to the Offer to refund subscription money to
unsuccessful applicants having an account in its bank by crediting such account
instead of remitting the same by cheque, pay order or bank draft. Applicants should,
therefore, not fail to give their bank account numbers.
8.1.20 Submission of fictitious and multiple applications (more than one application by same
person) is prohibited and such Application Money shall be liable to confiscation under
Section 18A of the Securities and Exchange Ordinance, 1969.
ADDITIONAL INSTRUCTIONS FOR FOREIGN/NON-RESIDENT INVESTORS
8.1.21 In case of foreign investors who are not individuals, applications must be accompanied with
a letter on applicant's letterhead stating the legal status of the applicant, place of
incorporation and operations and line of business. A copy of memorandum of association or
an equivalent document should also be enclosed, if available. Where applications are made
by virtue of Power of Attorney, the same must be lodged with the application. Copies of
these documents can be attested by the bank manager in the country of applicant's
residence.
8.1.22 Applicants may also subscribe using their Special Convertible Rupee Account (SCRA) as
set out under the State Bank of Pakistan's Foreign Exchange Manual.
BASIS OF ALLOTMENT
8.1.23 The basis and conditions of transfer of shares to the General Public shall be as follows:
a) The minimum amount of application for subscription of 500 shares is PKR 15,039/- (Offer
Price plus PKR 0.01 per share (Stamp duty on transfer of shares) plus 0.048032 per share
[CDC charges of 0.16% of the Offer Price] x 500 shares) in case shares are desired to be
transferred to a CDC account. In case physical shares are desired, minimum amount of
application for subscription of 500 shares is PKR 15,085/- (Offer Price plus PKR 0.15 per
share (Stamp duty on transfer of shares) x 500 shares).
b) Application for Shares must be made for 500 Shares or in multiple thereof only.
Applications, which are neither 500 Shares nor for multiple thereof, shall be rejected.
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c) Allotment/Transfer of Shares to successful applicants shall be made in accordance with the
allotment criteria/instructions disclosed in the OFSD.
d) Allotment of Shares shall be subject to scrutiny of applications in accordance with the
criteria disclosed in the OFSD and / or the instructions by the Securities and Exchange
Commission of Pakistan.
e) Applications, which do not meet the above requirements, or applications which are
incomplete will be rejected. The applicants are, therefore, required to fill in all the data
fields in the Application Form.
f) The Company will dispatch shares to successful applicants through their Bankers to the
Offer or credit the respective CDS accounts of successful applicants (as the case may be).
8.2. BANKERS TO THE OFFER
Code No.
01
02
03
04
05
06
Bank
Code No.
07
08
09
10
11
12
Allied Bank Limited
Askari Bank Limited
Bank Alfalah Limited
Faysal Bank Limited
Habib Bank Limited
Habib Metropolitan Bank Limited
Bank
JS Bank Limited
MCB Bank Limited
NIB Bank Limited
Samba Bank Limited
Silk Bank Limited
United Bank Limited
In order to facilitate investors, the Offerors have arranged provision of e-IPO facility through
UBL that is among the Bankers to the Offer. UBL account holders can use their Internet
Banking
facility
to
submit
their
application
online
via
link
www.ubldirect.com/corporate/ebank. The account holders of UBL can submit their
applications through these links 24 hours a day during the subscription period which will
close at 12:00 midnight on 24th September 2014.
8.3. CODE OF OCCUPATION
Code No.
01
02
03
04
05
Occupation
Business
Business Executive
Service
Housewife
Household
Code No.
06
07
08
09
10
Occupation
Professional
Student
Agriculturist
Industrialist
Others
8.4. NATIONALITY CODE
Code No.
001
002
003
004
005
Name of country
U.S.A
U.K
U.A.E
K.S.A
Oman
Code No.
006
007
008
009
Name of country
Bangladesh
China
Bahrain
Other
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PART 9
9 SIGNATORIES TO THE OFFER FOR SALE DOCUMENT
Signed, as required by Section 62, read with Section 57 of the Companies Ordinance, 1984 by:
For and on behalf of the Offerors,
Engro Corporation Limited
-sdNaz Khan
Chief Financial Officer
Engro Powergen Limited
-sdMohammed Saqib
Chief Financial Officer
Signed by the above in presence of witnesses:
Witness 1
Witness 2
-sd___________________________
Name: Mohammed Faizan Khan
Address: C/O Engro Corporation Limited
CNIC # 42301-6380655-5
-sd__________________
Name: Humair Abdul Rasheed
Address: C/O Engro Powergen Limited
CNIC # 42301-1113622-5
Dated: March 18th, 2014
Place: 4th Floor, The Habour Front Building, HC 3, Marine Drive, Block 4, Clifton, Karachi - 75600
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PART 10
10 MEMORANDUM OF ASSOCIATION
THE COMPANIES O RDINANCE , 1984
(COMPANY LIMITED BY SHARES)
Memorandum of Association
OF
ENGRO POWERGEN QADIRPUR LIMITED
(FORMERLY ENGRO ENERGY LIMITED)
I.
The name of the Company is "ENGRO POWERGEN QADIRPUR LIMITED.”
II.
The Registered Office of the Company will be situated in the Province of the SIND,
Pakistan.
III. The objects for which the Company is established are all or any of the following: 1.
To carry on at suitable locations at District Ghotki Sind and other places in
Pakistan the business of power generation, distribution, transmission and sale in
all its branches and aspects and by the use of such forms of energy and in such
manner as may be deemed feasible and sell and deliver the electricity thus
generated.
2.
To finance, design, construct, own, operate and maintain a power station
together with all machinery, equipment and works ancillary thereto (hereinafter
referred to as "Power station") and to do all such acts, deeds, and things,
without limitation whatsoever as may be necessary or desirable in that
connection.
3.
To carry on anywhere in Pakistan the business of power generation,
transmission, sale and distribution in all its branches and aspects and in
particular to construct, lay down, establish, maintain and fix all necessary
power stations together with ancillary works, cables, wires, lines, accumulators,
lamps, and to generate, accumulate, distribute, sell and supply electricity.
4.
To construct and maintain roads, bridges, wharves, quays, jetties and piers,
pipelines and storage tanks for water, petroleum products, natural gas and other
substances, gas processing and compression plants, water desalination and
treatment plants and such other works as may be required for all or any of the
above purposes.
5.
To provide engineering, construction, consultancy and design services and any
facilities, equipment and installations whether related to such services and
systems or otherwise.
6.
To carry on the businesses of manufacturing, supplying, servicing, engineering,
contractors, consultants, agents and import, export, buying, selling,
manufacturing and/or dealing in all types of machinery, plant or equipment
used in connection with the generation, transmission, distribution and supply of
electricity or any other form of energy.
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7.
To buy, sell, import, hire, manufacture, deal in, and turn to account plant,
machinery, implements, conveniences, provisions, articles, and products
capable of being used in connection with the operations of or required by
workmen and others employed by the Company or incidentally or conveniently
connected with any such business as aforesaid.
8.
To explore for, produce, import or otherwise obtain any fuel or other raw
materials for use in connection with the generation of electricity or any other
form of energy and to process and deal in any such raw materials or any by products thereof and to process and deal in any by-products which may be
obtained from the activities of generating, transmitting, distributing or
supplying electricity or any other form of energy.
9.
To carry on the businesses in all their branches of retailers, suppliers and
dealers in electrical appliances, household and general domestic equipment,
fixtures and fittings and all kinds of goods, equipment, materials or installations
connected with the use of electricity or any other form of energy whether for
domestic, industrial, commercial or other purposes.
10. To conduct, promote and commission research of all kinds and research and
development activities of all kinds, whether related to the generation,
transmission, distribution and supply of electricity or other form of energy or
otherwise, and to exploit and turn to account the results of any such research or
research and development carried out by or for the Company.
11. To acquire by any means and hold and deal with any heritable, real or personal
property or corporeal or incorporeal rights whatsoever, whether or not for the
purposes of or in connection with any of the foregoing activities, and (without
prejudice to the generality of the foregoing) to purchase, take on lease or in
exchange, hire or otherwise acquire and hold any heritable or real property and
any estate or interest in such property, including without limitation any lands,
buildings, installations, structures, servitudes, easements, privileges and
concessions and to use, exploit and develop the same.
12. To abstract and divert water from any appropriate source for use in connection
with the generation of electricity.
13. To carry on any other trade or business whatever which, in the opinion of the
Directors of the Company, can be advantageously carried on in connection with
or ancillary to any of the above mentioned businesses or is calculated directly
or indirectly to enhance the value of, or render profitable any of, the property or
rights of the Company.
14. To carry on any other trade, commerce, industry and/or business whatsoever,
which, in the opinion of the Directors of the Company, is or may be capable of
being carried on directly or indirectly for the benefit of the Company.
15. To purchase or by any other means acquire and take options over any property
whatever, and any rights or privileges of any kind over or in respect of any
property.
16. To apply for, register, purchase, or by other means acquire and protect, prolong
and renew, whether in Pakistan or elsewhere, any trademarks, patents,
copyrights, trade secrets, or other intellectual property rights, licences, secret
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processes, designs, protections and concessions and to disclaim, alter, modify,
use and turn to account and to manufacture under or grant licences or privileges
in respect of the same, and to expend money in experimenting upon, testing and
improving any patents, inventions or rights which the Company may acquire or
propose to acquire.
17. To acquire or undertake the whole or any part of the business, goodwill, an d
assets of any person, firm, or company carrying on or proposing to carry on any
of the businesses which the Company is authorised to carry on and as part of
the consideration for such acquisition to undertake all or any of the liabilities of
such person, firm or company, or to acquire an interest in, amalgamate with, or
enter into partnership or into any arrangement for sharing profits, or for co operation, or for mutual assistance with any such person, firm or company, or
for subsidising or otherwise assisting any such person, firm or company, and to
give or accept, by way of consideration for any of the acts or things aforesaid or
property acquired, any shares, debentures, debenture stock or securities that
may be agreed upon.
18. To enter into any arrangements with any government or authority (municipal,
local, or otherwise) that may seem conducive to the attainment of the
Company's objects or any of them, and to obtain from any such government or
authority any charters, decrees, rights, privileges or concessions which the
Company may think desirable and to carry out, exercise, and comply with any
such charters, decrees, rights, privileges, and concessions.
19. To carry on and undertake trading business of all sorts and to act as indentors,
importers, exporters, traders, suppliers, and commission agents of products,
commodities and materials in any form or shape manufactured or supplied by
any company, firm, association of persons, body, whether incorporated or not,
individuals, Government, Semi- Government or any local authority.
20. To apply for, tender, offer, accept, purchase, enter into or otherwise acquire any
contracts and concessions for or in relation to the projection, execution,
carrying out, improvements, management, administration or control of works
and conveniences and undertake, execute, carry out, dispose of or otherwise
turn to account the same.
21. To carry on in or outside Pakistan the business of manufacturers, transmitters,
suppliers, importers, exporters, indentors, transporters, dealers in all articles
and commodities akin to or connected with any of the business of the Company
capable of being conveniently carried on or necessary for the promotion of the
objects herein contained, as permissible under law.
22. To carry on business and obtain licences for shipping agents, clearing and
forwarding agents, purchasing and indenting agents, selling agents, (except
managing agent) on such terms and conditions as the Company may think
proper, subject to any permission as required under the law.
23. To carry on agency business (except managing agency) and to acquire and hold
selling agencies and to act as selling agents, commission agents, manufacturers'
representatives and distributing agents of and for the distribution of all kinds of
merchandise, goods, commodities, products, materials, substances, articles and
things whether finished, semi-finished, raw, under process, refined, treated or
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otherwise pertaining to trade and commerce and for that purpose to remunerate
them and to open and maintain depots and branches.
24. To purchase, take on lease or in exchange, hire, apply for or otherwise acquire
and hold any interest, any rights, privileges, lands, building, easements,
trademarks, patents, patent rights, copyrights, licences, machinery, plants,
stock-in-trade and any movable and immovable property of any kind necessary
or convenient for the purposes of or in connection with the Company's business
or any branch or department thereof and to use, exercise, develop, grant
licences in respect of or otherwise turn to account any property, rights and
information so acquired, subject to any permission required under the law.
25. To acquire by concession, grant, purchase, barter, licence either absolutely or
conditionally and either solely or jointly with others any lands, buildings,
machinery, plants, equipments, privileges, rights, licences, trademarks, patents,
and other movable and immovable property of any description which the
Company may deem necessary or which may seem to the Company capable of
being turned to account, subject to any permission as required under the law.
26. To act as representatives, for any person, firm or company and to undertake and
perform sub-contracts, and also act in the business of the Company through or
by means of agents, sub-contractors and to do all or any of the things mentioned
herein in any part of the world and either alone or in collaboration with others
and by or through agents, sub-contractors or otherwise.
27. To establish, promote or assist in establishing or promoting and subscribe to or
become a member of any other company, association or club whose objects are
similar or in part similar to the objects of this Company or the establishment or
promotion of which may be beneficial to the Company or its employees.
28. To open accounts with any Bank or Banks and to draw, make, accept, endorse,
execute, issue, negotiate and discount cheques, promissory notes, bills of
exchange, bills of lading, warrants, deposit notes, debentures, letter of credit
and other negotiable instruments and securities.
29. To arrange local and foreign currency loans from scheduled & other banks,
leasing companies and modarbas and other financial institutions for the purpose
of purchase, manufacture, market, supply, export and import of machinery,
construction of factory, building and for the purpose of working capital or for
any other purpose.
30. To sell or otherwise dispose of the whole or any part of the undertaking of the
Company, either together or in portions for such consideration as the Company
may think fit and in particular, for shares, debenture-stock or securities of any
Company purchasing the same.
31. To borrow or raise money by means of loans or other legal arrangements from
banks, or other financial institutions, or Directors in such manner as the
Company may think fit and in particular by issue of debentures, debenture
stock, perpetual or otherwise convertible into shares and to mortgage, or charge
the whole or any part of the property or assets of the Company, present or
future, by special assignment or to transfer or convey the same absolutely or in
trust as may seem expedient and to, purchase, redeem or payoff any such
securities.
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32. To pay all costs, charges, and expenses preliminary or incidental incurred in
formation or about the promotion and establishment of the Company and to
remunerate any person, firm or company for services rendered or to be rendered
in or about the formation or promotion of the Company or the conduct of its
business.
33. To give any servant or employee of the Company commission in the profits of
the Company's business or any branch thereof and for the purpose to enter into
any agreement or scheme of arrangement as the Company may deem fit and to
procure any servants or employees of the Company to be insured against risk of
accident in the course of their employment by the Company.
34. To establish and support or aid in the establishment and support of associations,
trusts, institutions, funds and conveniences calculated to benefit persons who
are or have been Directors of or who have been employed by or who are serving
or have served the Company or any other Company which is a subsidiary or
associate of the Company or the dependents of such persons and to grant
pensions, gratuities, provident funds, allowances, relief and payments in any
other manner calculated to benefit the persons described herein.
35. To distribute any of the Company's property and assets among the members in
specie or in any manner whatsoever in case of winding up of the Company.
36. To guarantee the performance of contracts and obligations of the Company or
any of its associated companies or persons or any other person or company
whatsoever.
37. To cause the Company to be registered or recognised in any foreign country.
38. To do and perform all other acts and things as are incidental or conducive to the
attainment of the above objects or any of them.
39. To apply for and obtain necessary consents, permissions and licences from any
Government, State, Local and other Authorities for enabling the Company to
carry on any of its objects into effect as and when required by law.
40.
It is declared that the company shall not engaged in business of banking
company, banking, leasing, investment, managing agency or insurance business
or directly or indirectly as restricted under the law or any unlawful operation
and the company shall not indulge in multi-level marketing, launching of ponzi
or pyramid schemes for marketing purposes.
41. Notwithstanding anything stated in any object clause, the company shall obtain
such other approval or license from Competent Authority, as may be required
under any law or the time being in force, to undertake a particular business.
IV. The liability of the members is limited.
V.
The authorised share capital of the Company is Rs. 3,300,000,000/- (Rupees Three
billion three hundred million) divided into 330,000,000, (three hundred and thirty
million) shares of the nominal value of Rs. 10.00 (Rupees ten) each with the rights,
privileges and conditions attached thereto as are provided for the time being, with
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power to increase and reduce the capital of the Company and to divide the shares in
the capital for the time being, into several classes.
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