Nafa Stock Fund: Quarterly Report - 30 September 2017

Transcription

2. NAFA STOCK FUND MISSION STATEMENT To rank in the top quartile in performance of NAFA FUNDS relative to the competition , and to consistently offer Superior risk-adjusted returns to investors. Quarterly Report Page 01
3. Contents NAFA STOCK FUND Page 02 FUND 'S INFORMATION 03 DIRECTORS' REPORT 05 CONDENSED INTERIM STATEMENT OF ASSETS AND LIABILITIES 09 CONDENSED INTERIM INCOME STATEMENT 10 CONDENSED INTERIM STATEMENT OF COMPREHENSIVE INCOME 11 CONDENSED INTERIM STATEMENT OF MOVEMENT IN UNIT HOLDERS' FUND 12 CONDENSED INTERIM CASH FLOW STATEMENT 13 NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS 14 Quarterly Report
4. NAFA STOCK FUND Mr . Mudassir Husain Khan Mr. Tariq Jamali Mr. Abdul Hadi Palekar Dr. Foo Chiah Shiung (Kelvin Foo) Mr. Lui Mang Yin (Martin Lui) Mr Humayun Bashir Chief Financial Officer Mr. Khalid Mehmood Mr. Tariq Jamali Dr. Foo Chiah Shiung (Kelvin Foo) Human Resource and Remuneration Committee Mr. Kamal Amir Chinoy Mr. Abdul Hadi Palekar Mr. Lui Mang Yin (Martin Lui) Chairman Member Member National Bank of Pakistan Dubai Islamic Bank Pakistan Limited Sindh Bank Limited JS Bank Limited Zarai Taraqiati Bank Limited Bankislami Pakistan Limited Al-Baraka Bank (Pakistan) Limited Sindh Bank Limited Quarterly Report Page 03
5. NAFA STOCK FUND Auditors KPMG Taseer Hadi & Co. Chartered Accountants Sheikh Sultan Trust Building No.02 Beaumont Road, Karachi - 75530, Pakistan. Legal Advisor M/s Jooma Law Associates 205, E.I. Lines, Dr. Daudpota Road, Karachi. 7th Floor Clifton Diamond Vuilding, Block No. 4, Scheme No. 5, Clifton Karachi. UAN: 111-111NFA (111-111-632), (Toll Free): 0800-20001, Fax: (021) 35825329 Website: www.nafafunds.com Lahore Office: 7-Noon Avenue, Canal Bank, Muslim Town, Lahore. UAN: 042-111-111-632 Fax: 92-42-35861095 Islamabad Office: Plot No. 395, 396 Industrial Area, I-9/3 Islamabad. UAN: 051-111-111-632 Phone: 051-2514987 Fax: 051-4859031 Peshawar Office: Opposite Gul Haji Plaza, 2nd Floor National Bank Building University Road Peshawar, UAN: 091-111 111 632 (nfa) Fax: 091-5703202 Multan Office: Page 04 Quarterly Report
6. NAFA STOCK FUND DIRECTORS ’ REPORT The Board of Directors of NBP Fullerton Asset Management Limited is pleased to present the unaudited financial statements of NAFA Stock Fund (NSF) for the quarter ended September 30, 2017. Fund’s Performance During the first quarter, the unit price of NAFA Stock Fund (NSF) has decreased from Rs. 16.2017 (Ex-Div) on June 30, 2017 to Rs. 14.5970 on September 30, 2017, thus showing a decrease of 9.9%. The Benchmark (KSE-30 Total Return Index) for the same period decreased by 10.0%. Thus, the Fund has outperformed its Benchmark by 0.1% during the period under review. Since inception (January19, 2007), the unit price of the Fund has shown a growth of 436.1% as compared to 100.3% increase in its Benchmark. Thus, the Fund has outperformed its Benchmark by 335.8%. This performance is net of management fee and all other expenses. The Fund size of NSF at the end of the period stood at Rs.15,038 million, 11% lower compared to the previous quarter. The market started FY18 on a frail note as non-materialization of highly anticipated net foreign inflows in June, post up-gradation of PSX into MSCI Emerging Index from Frontier Market, sapped investor’s sentiments. Deteriorating Balance of Payment (BoP) position and its associated impact on other macro-economic indicators dampened investors’ confidence in the market. Adding to the investor worries was elevated political incertitude. The growing tensions in the Pak-US relations also impacted the stock market. Resultantly, the benchmark KSE 100 Index declined by 8.9% during the period under review. Looking at the sector-wise performance, Oil & Gas Exploration, Oil & Gas Marketing Companies, Fertilizer, Power Generation & Distribution, and Banking sectors fared better than the market. Cement sector was a major index drag with under-performance of around 18.6%. After sizeable net outflow of USD652mn in FY17, foreigners continued to remain net sellers during 1QFY18, as they offloaded equity stakes worth USD90mn. Other than foreigners, Mutual Funds during the quarter also remained net sellers with a net outflow of USD38mn. Their counterparts were Insurance Companies and Banks/DFIs with net inflow of USD49mn and USD34mn, respectively. The Fund has incurred loss of Rs.1,613.47 million during the period. After accounting for expenses of Rs.126.67 million, the net loss is Rs.1,740.14 million. The asset allocation of the Fund as on September 30, 2017 is as follows: Others 31.9% Oil & Gas Marketing Companies 6.6% Cash Equivalents and Others including receivables 10.1% Textile Composite 8.5% Cement 10.7% Oil & Gas Exploration Companies 16.4% Commercial Banks 15.8% Quarterly Report Page 05
7. NAFA STOCK FUND NSF Performance versus Benchmark (Since Inception) 600% NSF KSE30 500% 436% 400% 300% 200% 100% 100% 19-Jan-17 19-May-17 19-Sep-16 19-Jan-16 19-May-16 19-Sep-15 19-Jan-15 19-May-15 19-Sep-14 19-Jan-14 19-May-14 19-Sep-13 19-Jan-13 19-May-13 19-Sep-12 19-Jan-12 19-May-12 19-Sep-11 19-Jan-11 19-May-11 19-Sep-10 19-Jan-10 19-May-10 19-Sep-09 19-Jan-09 19-May-09 19-Sep-08 19-Jan-08 19-May-08 19-Sep-07 19-Jan-07 19-May-07 -100% 30-Sep-17 19-Sep-17 0% Acknowledgement The Board takes this opportunity to thank its valued unit-holders for their confidence and trust in the Management Company, and providing the opportunity to serve them. It also offers its sincere gratitude to the Securities & Exchange Commission of Pakistan and State Bank of Pakistan for their patronage and guidance. The Board also wishes to place on record its appreciation for the hard work, dedication and commitment shown by the staff and the Trustee. On behalf of the Board of NBP Fullerton Asset Management Limited Chief Executive Director Date: October 27, 2017 Place: Karachi. Page 06 Quarterly Report
8. NAFA STOCK FUND Quarterly Report Page 07
9. NAFA STOCK FUND Others 31 .9% Oil & Gas Marketing Companies 6.6% Cash Equivalents and Others including receivables 10.1% Textile Composite 8.5% Cement 10.7% Oil & Gas Exploration Companies 16.4% Commercial Banks 15.8% Page 08 Quarterly Report
10. NAFA STOCK FUND CONDENSED INTERIM STATEMENT OF ASSETS AND LIABILITIES AS AT SEPTEMBER 30 , 2017 Note (Un- Audited) September 30' 2017 (Audited) June 30, 2017 (Rupees in '000) ASSETS Bank balances Investments Dividend and profit receivable Receivable against sale of investments Receivable against conversion of units Advance and deposits Total assets 4 5 1,769,695 13,513,899 91,218 37,518 120 7,204 15,419,654 1,681,511 15,414,375 33,417 172,593 496 7,191 17,309,583 88,696 1,496 3,863 48,542 2,519 237,058 382,174 75,957 1,750 13,318 6,114 2,642 106,716 245,334 451,831 LIABILITIES Payable to NBP Fullerton Asset Management Limited - Management Company Payable to Central Depository Company of Pakistan Limited - Trustee Payable to Securities and Exchange Commission of Pakistan Payable against conversion of units Payable against redemption of units Dividend payable Accrued expenses and other liabilities Total liabilities 6 -----------Number of units--------NET ASSETS 15,037,480 16,857,752 UNIT HOLDERS’ FUNDS (AS PER STATEMENT ATTACHED) 15,037,480 16,857,752 CONTINGENCIES AND COMMITMENTS 7 --------------(Rupees)-------------- Number of units in issue 1,030,172,623 1,039,713,941 14.5970 16.2138 NET ASSET VALUE PER UNIT The annexed notes 1 to 15 form an integral part of these condensed interim financial statements. For NBP Fullerton Asset Management Limited (Management Company) Chief Financial Officer Quarterly Report Chief Executive Officer Director Page 09
11. NAFA STOCK FUND CONDENSED INTERIM INCOME STATEMENT FOR THE QUARTER ENDED SEPTEMBER 30 , 2017 (UN-AUDITED) Note INCOME Quarter Ended Quarter Ended September 30' September 30, 2017 2016 (Rupees in '000) (Loss) / gain on sale of investments - net Profit on bank deposits Dividend income Net unrealised (diminution) / appreciation on re-measurement of investments classified as 'financial assets at fair value through profit or loss' Total (loss) / income (277,450) 24,619 107,032 100,491 13,646 99,353 (1,467,675) (1,613,474) 860,226 1,073,716 81,329 10,573 46,915 6,099 4,318 561 4,066 3,863 4,855 538 14 185 45 25 25 16,266 2,598 338 2,346 2,228 2,147 276 10 138 47 - EXPENSES Remuneration of the NBP Fullerton Asset Management Limited Management Company Sindh Sales Tax on remuneration of the Management Company Remuneration of the Central Depository Company of Pakistan Limited Trustee Sindh Sales Tax on Remuneration of the Trustee Accounting and operational expenses Annual fee - Securities and Exchange Commission of Pakistan Securities transaction cost Settlement and bank charges Annual listing fee Auditors' remuneration Fund rating fee Legal and professional charges Printing charges Selling and marketing expenses 10 Total Expenses Net (loss) / Income from operating activities 126,663 63,142 (1,740,137) 1,010,574 Element of income / (loss) and capital gains / (losses) included in prices of units issued less those in units redeemed - net Provision for Sindh Workers' Welfare Fund 9 Net (loss) / income for the period before taxation (1,740,137) Taxation 8 Net (loss) / income for the period after taxation 1,078,876 (1,740,137) Earnings per unit 68,302 12 1,078,876 - - Allocation of net income for the period Income already paid on units redeemed (5,352) Accounting income available for distribution: - Relating to Capital Gains - Excluding Capital Gains Accounting Income available for Distribution - (1,745,489) 1,078,876 The annexed notes 1 to 15 form an integral part of these condensed interim financial statements. For NBP Fullerton Asset Management Limited (Management Company) Chief Financial Officer Page 10 Chief Executive Officer Director Quarterly Report
12. NAFA STOCK FUND CONDENSED INTERIM STATEMENT OF COMPREHENSIVE INCOME FOR THE QUARTER ENDED SEPTEMBER 30 , 2017 (UN-AUDITED) Quarter Ended September 30' 2017 Quarter Ended September 30, 2016 (Rupees in '000) Accounting (loss) / Income available for Distribution (1,745,489) Other Comprehensive Income for the period 1,078,876 - Total comprehensive (loss) / income for the period (1,745,489) 1,078,876 The annexed notes 1 to 15 form an integral part of these condensed interim financial statements. For NBP Fullerton Asset Management Limited (Management Company) Chief Financial Officer Quarterly Report Chief Executive Officer Director Page 11
13. NAFA STOCK FUND CONDENSED INTERIM STATEMENT OF MOVEMENT IN UNIT HOLDERS ’ FUND FOR THE QUARTER ENDED SEPTEMBER 30, 2017 (UN-AUDITED) Note Quarter Ended Quarter Ended September 30' September 30, 2017 2016 (Rupees in '000) Net assets at the beginning of the period 16,857,752 7,938,880 Issue of 174,004,485 units (2016: 143,742,388 units) Redemption of 183,545,803 units (2016: 54,966,334 units) 2,698,801 (2,767,465) (68,664) 2,024,420 (783,553) 1,240,867 Net element of (income) / loss and capital (gains) / losses included in prices of units issued less those in units redeemed - transferred to Condensed Interim Income Statement (1,745,489) Accounting income available for distribution (68,302) 1,078,876 5,352 Income already paid on units redeemed Net assets at the end of the period - (11,471) Final cash distribution for the year ended June 30, 2017: 0.0110 per unit (2016: Nil) - 15,037,480 10,190,321 16.2138 14.5970 13.2076 14.7716 2,544,122 1,797,864 4,341,986 680,637 535,727 1,216,364 (1,745,489) 1,078,876 Net Assets value per unit as at beginning of the period Net Assets value per unit as at end of the period Distribution during for the period: Undistrubuted income brought forward Realised gain Unrealised gain Accounting income available for distribution: -Relating to capital gains -Excluding capital gains Final cash distribution for the year ended June 30, 2017: 0.0110 per unit (2016: Nil) Undistributed income carried forward (11,471) - 2,585,026 2,295,240 4,052,701 (1,467,675) 2,585,026 1,435,014 860,226 2,295,240 Undistributed income comprising of : Realised gain Unrealised (loss) / gain The annexed notes 1 to 15 form an integral part of these condensed interim financial statements. For NBP Fullerton Asset Management Limited (Management Company) Chief Financial Officer Page 12 Chief Executive Officer Director Quarterly Report
14. NAFA STOCK FUND CONDENSED INTERIM CASH FLOW STATEMENT FOR THE QUARTER ENDED SEPTEMBER 30 , 2017 (UN-AUDITED) Quarter Ended Quarter Ended September 30' September 30, 2017 2016 (Rupees in '000) CASH FLOW FROM OPERATING ACTIVITIES Net (loss) / income for the period before taxation (1,740,137) Adjustments Element of income / (loss) and capital gains / (losses) included in prices of units issued less those in units redeemed - net Net unrealised diminution / (appreciation) on re-measurement of investments classified as 'financial assets at fair value through profit or loss' - 1,078,876 (68,302) 1,467,675 (272,462) (860,226) 150,348 432,801 (57,801) 135,075 (13) 510,062 (1,221,239) (90,412) 34,011 (1,277,640) 12,739 (254) (9,455) (8,276) (5,246) 7,889 204 (3,464) 31,146 (28,802) 6,973 Net cash generated from / (used in) operating activities 232,354 (1,120,319) CASH FLOW FROM FINANCING ACTIVITIES Net receipts from issue of units Net payments on redemption of units Distributions made Net cash (used in) / generated from financing activities 2,699,177 (2,727,679) (115,668) (144,170) 2,024,420 (783,553) (11,664) 1,229,203 Net increase in cash and cash equivalents during the period Cash and cash equivalents at the beginning of the period 88,184 1,681,511 108,884 836,997 Cash and cash equivalents at the end of the period 1,769,695 945,881 Decrease / (increase) in assets Investments Dividend and profit receivable Receivable against sale of investments Advance and deposits (Decrease) / increase in liabilities Payable to NBP Fullerton Asset Management Limited - Management Company Payable to Central Depository Company of Pakistan Limited - Trustee Payable to Securities and Exchange Commission of Pakistan Payable against purchase of investments Accrued expenses and other liabilities The annexed notes 1 to 15 form an integral part of these condensed interim financial statements. For NBP Fullerton Asset Management Limited (Management Company) Chief Financial Officer Quarterly Report Chief Executive Officer Director Page 13
15. NAFA STOCK FUND NOTES TO AND FORMING PART OF THIS CONDENSED INTERIM FINANCIAL INFORMATION (Un-Audited) FOR THE QUARTER ENDED SEPTEMBER 30, 2017 1 LEGAL STATUS AND NATURE OF BUSINESS The NAFA Stock Fund (the Fund) was established under a Trust Deed executed between NBP Fullerton Asset Management Limited as Management Company and Central Depository Company of Pakistan Limited (CDC) as Trustee. The Trust Deed was executed on 06 December 2006 and was approved by the Securities and Exchange Commission of Pakistan (SECP) on 20 December 2006 in accordance with the Non-Banking Finance Companies (Establishment and Regulation) Rules, 2003 (NBFC Rules). The Management Company of the Fund has been licensed to act as an Asset Management Company under the NBFC Rules through a certificate of registration issued by the SECP. The registered office of the Management Company is situated at 7th floor, Clifton Diamond Building, Block No. 4, Scheme No. 5, Clifton, Karachi. The Management Company is also the member of Mutual Fund Association of Pakistan (MUFAP). The Fund is an open-ended mutual fund classified as an ''equity scheme'' by the Management Company as per the criteria for categorization of open end collective investment scheme as specified by Securities and Exchange Commision of Pakistan (SECP) and other allied matters and is listed on the Pakistan Stock Exchange. Units are offered for public subscription on a continuous basis. The units are transferable and can be redeemed by surrendering them to the Fund. The core objective of the Fund, is to provide investors with long term capital growth from an actively managed portfolio invested primarily in listed companies in Pakistan. The Pakistan Credit Rating Agency Limited (PACRA) has assigned an asset manager rating of 'AM1' to the Management Company and perfomance rating of '5-Star' to the Fund. Title of the assets of the Fund is held in the name of Central Depository Company of Pakistan Limited (CDC) as the Trustee of the Fund. 2 BASIS OF PREPARATION 2.1 Statement of compliance These condensed interim financial statements have been prepared in accordance with the approved accounting standards as applicable in Pakistan. Approved accounting standards comprise of such International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board as are notified under the repealed Companies Ordinance, 1984, and the requirements of the Non-Banking Finance Companies (Establishment and Regulation) Rules, 2003 (the NBFC Rules), the Non-Banking Finance Companies and Notified Entities Regulations, 2008, (the NBFC Regulations) and directives issued by the Securities and Exchange Commission of Pakistan (SECP). Wherever, the requirement of the NBFC Rules, the NBFC Regulations and the said directives differ with the requirements of these standards, the requirements of the NBFC Rules, the NBFC Regulations, and the said directives shall prevail. The disclosures made in these condensed interim financial statements have, however, been limited based on the requirements of the International Accounting Standard 34, Interim Financial Reporting. The directors of the asset management company declare this condensed interim financial information gives a true and fair view of the fund 3 SUMMARY OF ACCOUNTING POLICIES The accounting policies adopted for the preparation of the condesed interim financial statements for the quarter ended September 30, 2017 are same as those applied in the preparation of annual audited financial statements for the year ended June 30, 2017 except for Element of Income. Pursuant to SRO 756(I)/2017, management has changed its accounting policy whereby element of income / loss and capital gains / losses in prices of units issued less those in units redeemed during the year, previously transferred to the 'income statement' has now been taken to unit holders' fund. The above change has been applied from July 01, 2017 as clarified by MUFAP, therefore the comparative information have not been restated. Page 14 Quarterly Report
16. NAFA STOCK FUND Note 4 INVESTMENTS Audited As at June 30 , 2017 (Rupees in '000) At fair value through profit or loss - held for trading Listed equity securities 4.1 Un-audited As at September 30, 2017 4.1 13,513,899 15,414,375 Investment in listed equity securities All shares have a nominal face value of Rs.10 each except for the shares of Thal Limited, Al-Ghazi Tractor Limited and Shabbir Tiles and Ceramics Limited which have a face value of Rs.5. Name of the Investee Company Refinery Attock Refinery Limited National Refinery Limited Oil and Gas Exploration Company Pakistan Oilfields Limited Pakistan Petroleum Limited Mari Petroleum Company Limited Oil & Gas Development Company Limited Oil and Gas Marketing Company Pakistan State Oil Company Limited Attock Petroleum Limited Shell Pakistan Limited Hascol Petroleum Limited Sui Northern Gas Pipelines Limited Fertilizer Dawood Hercules Corporation Limited Engro Corporation Limited Engro Fertilizers Limited Fauji Fertilizer Bin Qasim Company Limited Fauji Fertilizer Company Limited Chemical Engro Polymer & Chemicals Limited Automobile Parts and Accessories Thal Limited* Baluchistan Wheels Limited Cement D.G. Khan Cement Company Limited Lucky Cement Limited Maple Leaf Cement Factory Limited Pioneer Cement Limited Attock Cement Pakistan Limited Fecto Cement Limited Fauji Cement Company Limited Thatta Cement Company Limited Kohat Cement Company Limited Cherat Cement Company Limited Paper and Board Century Paper and Board Mills Limited Cherat Packaging Limited Automobile Assembler Al-Ghazi Tractors Limited* Indus Motor Company Limited Millat Tractors Limited Pak Suzuki Motor Company Limited Pharmaceuticals Abbot Laboratories (Pakistan) Limited GlaxoSmithKline (Pakistan) Limited GlaxoSmithKline Consumer Healthcare Pakistan Limited The Searle Company Limited Engineering International Industries Limited International Steel Limited Amreli Steels Limited K.S.B Pumps Limited Ittefaq Iron Industries Limited Mughal Iron and Steel Industries Limited Quarterly Report Right shares Sales As at 30 purchased/ during Septemvber 2017 subscribed the period during the period ------------------------------------------- ( Number of shares ) ------------------------------------------- As at 1 July 2017 Purchases during the period Bonus Shares issued during the period Market value as at 30 June 2017 (Rupees in '000) Market value as a percentage of net assets Market value as a percentage of total investment Percentage of the paid up capital of the investee company held ---------------------- (%) ---------------------- 201,100 9,350 210,450 215,000 215,000 - - 142,000 142,000 274,100 9,350 283,450 113,261 6,208 119,469 0.75 0.04 0.79 0.84 0.05 0.88 0.32 0.01 1,246,230 3,632,925 461,060 3,145,381 8,485,596 170,700 422,900 281,000 874,600 - - 401,000 59,520 300,000 760,520 1,416,930 3,654,825 401,540 3,126,381 8,599,676 753,863 638,462 604,322 464,705 2,461,352 5.01 4.25 4.02 3.09 16.37 5.58 4.72 4.47 3.44 18.21 0.60 0.19 0.36 0.07 689,667 149,750 552,000 3,042 2,386,500 3,780,959 171,500 945,500 1,117,000 - - 56,000 67,700 732,000 855,700 805,167 149,750 484,300 3,042 2,600,000 4,042,259 355,690 93,703 201,401 855 348,036 999,685 2.37 0.62 1.34 0.01 2.31 6.65 2.63 0.69 1.49 0.01 2.58 7.40 0.30 0.18 0.45 0.00 0.41 590,400 1,690,085 3,963,000 1,404,000 7,647,485 305,500 1,877,000 2,415,000 4,597,500 - - 479,000 1,923,000 1,404,000 625,000 4,431,000 590,400 1,516,585 3,917,000 1,790,000 7,813,985 72,832 459,662 246,419 148,821 927,734 0.48 3.06 1.64 0.99 6.17 0.54 3.40 1.82 1.10 6.87 0.12 0.29 0.29 0.14 7,893,500 500,000 - - 5,097,500 3,296,000 110,119 0.73 0.81 0.50 - - 52,250 52,250 211,239 87,000 298,239 116,414 10,614 127,028 0.77 0.07 0.84 0.86 0.08 0.94 0.26 0.65 263,489 87,000 350,489 - 1,611,900 744,883 1,288,700 1,015,300 1,122,701 243,200 5,857,000 1,050,000 883,500 2,403,000 16,220,184 859,600 212,000 9,800 409,000 127,900 317,500 1,935,800 - 121,213 121,213 467,500 92,100 1,113,000 65,000 3,352,500 910,500 6,000,600 2,004,000 652,783 296,913 1,162,300 1,132,501 243,200 2,913,500 139,500 1,011,400 2,720,500 12,276,597 294,307 368,940 16,914 104,537 228,754 20,169 94,747 3,585 151,670 326,406 1,610,029 1.96 2.45 0.11 0.70 1.52 0.13 0.63 0.02 1.01 2.17 10.71 2.18 2.73 0.13 0.77 1.69 0.15 0.70 0.03 1.12 2.42 11.91 0.46 0.20 0.05 0.51 0.99 0.48 0.21 0.14 0.65 1.54 3,337,500 415,001 3,752,501 49,000 15,500 64,500 - 55,634 55,634 18,400 18,400 3,386,500 467,735 3,854,235 226,388 86,593 312,981 1.51 0.58 2.08 1.68 0.64 2.32 2.30 1.39 103,500 242,810 299,900 90,950 737,160 2,300 2,300 - - 24,900 480 24,920 9,600 59,900 78,600 244,630 274,980 81,350 679,560 46,631 420,964 343,255 37,231 848,081 0.31 2.80 2.28 0.25 5.64 0.35 3.12 2.54 0.28 6.28 0.14 0.31 0.62 0.10 163,900 2,000 15,600 30,259 211,759 - - - 24,750 24,750 139,150 2,000 15,600 30,259 187,009 109,789 368 4,344 12,222 126,723 0.73 0.00 0.03 0.08 0.84 0.81 0.00 0.03 0.09 0.94 0.14 0.00 0.02 0.02 - - 235,400 138,000 521,500 894,900 917,400 1,335,000 2,671,600 4,200 2,578,500 2,384,387 9,891,087 266,229 161,709 272,423 1,260 64,179 136,435 902,235 1.77 1.08 1.81 0.01 0.43 0.91 6.00 1.97 1.20 2.02 0.01 0.47 1.01 6.68 0.77 0.31 0.90 0.03 1.97 0.95 1,152,800 1,286,000 2,518,000 4,200 3,100,000 2,072,887 10,133,887 187,000 153,600 311,500 652,100 Page 15
17. NAFA STOCK FUND Name of the Investee Company Textile Composite Azgard Nine Limited (Non-voting) Gul Ahmed Textile Mills Limited Kohinoor Textile Mills Limited Nishat Chunian Limited Nishat Mills Limited Sapphire Fibres Limited Food and Personal Care Products Al-Shaheer Corporation Limited Technology and Communication Avanceon Limited System Limited Power Generation and Distribution Kot Addu Power Company Limited Saif Power Limited The Hub Power Company Limited Commercial Banks Allied Bank Limited Bank Al-Falah Limited Bank Al-Habib Limited Faysal Bank Limited Habib Bank Limited MCB Bank Limited Meezan Bank Limited United Bank Limited Right shares Sales As at 30 purchased/ during Septemvber 2017 subscribed the period during the period ------------------------------------------- ( Number of shares ) ------------------------------------------- As at 1 July 2017 806,400 5,793,200 4,155,000 4,502,300 2,312,000 40 17,568,940 Purchases during the period 3,249,500 828,500 4,078,000 Bonus Shares issued during the period - 249,300 249,300 Market value as at 30 June 2017 (Rupees in '000) Market value as a percentage of net assets Market value as a percentage of total investment Percentage of the paid up capital of the investee company held ---------------------- (%) ---------------------- 1,379,500 861,000 2,240,500 806,400 5,793,200 4,404,300 6,372,300 2,279,500 40 19,655,740 5,645 227,325 373,246 347,418 330,755 40 1,284,429 0.04 1.51 2.48 2.31 2.20 0.00 8.54 0.04 1.68 2.76 2.57 2.45 0.00 9.50 0.15 1.63 1.47 2.65 0.65 0.00 223,500 1,854,288 58,633 0.39 0.43 1.30 955,250 2,127,000 3,082,250 40,741 164,928 205,669 0.27 1.10 1.37 0.30 1.22 1.52 0.72 1.90 2,077,788 - - - 955,250 2,111,000 3,066,250 16,000 16,000 - - 1,997,000 477,000 3,451,466 5,925,466 235,000 1,350,900 1,585,900 - - 571,500 693,500 1,265,000 1,660,500 477,000 4,108,866 6,246,366 126,264 14,424 459,412 600,100 0.84 0.10 3.06 3.99 0.93 0.11 3.40 4.44 0.19 0.12 0.36 4,674,701 1,065,000 1,816,150 10,744,783 2,364,163 2,063,100 52 2,930,840 25,658,789 94,500 4,084,000 1,141,000 1,720,370 374,500 600,400 8,014,770 - - 828,500 915,000 151,000 668,800 602,000 1,122,700 4,288,000 4,769,201 4,320,500 901,150 11,734,783 3,415,733 1,835,600 55 2,408,540 29,385,562 417,257 183,276 51,906 262,859 617,428 383,640 4 458,032 2,374,402 2.77 1.22 0.35 1.75 4.11 2.55 0.00 3.05 15.79 3.09 1.36 0.38 1.95 4.57 2.84 0.00 3.39 17.57 0.42 0.27 0.08 0.89 0.23 0.15 0.00 0.20 - 3 3 Insurance Pakistan Reinsurance Company Limited 1,110,000 - - - 1,079,000 31,000 1,410 0.01 0.01 0.01 Modarbas Sindh Modaraba 1,337,000 - - - 13,000 1,324,000 6,885 0.05 0.05 2.94 2,032,500 2,038,400 4,070,900 86,000 86,000 - - - 2,118,500 2,038,400 4,156,900 27,731 214,317 242,048 0.18 1.43 1.61 0.21 1.59 1.79 0.89 2.77 - - - 65,400 413,300 53,650 0.36 0.40 0.31 Glass and Ceramics Shabbir Tiles & Ceramics Limited* Tariq Glass Industries Limited Transport Pakistan National Shipping Corporation Limited Cable and Electric Goods Pak Elektron Limited Miscellaneous Tri-Pack Films Limited TPL Properties Limited Synthetic Products Enterprises Limited Total - 30 September 2017 478,700 2,513,125 854,000 - - 1,730,000 1,637,125 124,340 0.83 0.92 0.33 24 1,800,000 1,800,024 160,500 160,500 - - 1,200,000 1,200,000 24 600,000 160,500 760,524 4 6,300 10,593 16,897 0.00 0.04 0.07 0.11 0.00 0.05 0.08 0.13 0.00 0.22 0.19 125,030,952 24,753,970 - 30,441,920 119,769,152 13,513,899 89.87 100.00 Carrying value before fair value adjustment as at 30 September 2017 426,150 14,981,574 4.1.1 Investments include shares with market value of Rs. 376.291 million (June 30, 2017: Rs. 266.092 million) which have been pledged with National Clearing Company of Pakistan Limited for guaranteeing settlement of the Fund's trades in accordance with Circular number 11 dated October 23, 2007 issued by the Securities and Exchange Commission of Pakistan. Page 16 Quarterly Report
18. NAFA STOCK FUND Un-audited As at September 30 , 2017 MARK-UP ACCURED AND DIVIDEND RECEIVABLE 5 Audited As at June 30, 2017 (Rupees in '000) Mark-up accrued on bank balances Dividend receivable 486 90,732 91,218 33,206 211 33,417 108,972 32,183 3,904 621 4,866 24 382 80,283 4,988 123 33 136 543 237,058 108,972 32,183 3,904 436 5,212 32 273 76,373 17,210 98 8 90 543 245,334 ACCRUED EXPENSES AND OTHER LIABILITIES 6 Provision for Sindh Workers' Welfare Fund Federal Excise Duty on management remuneration Federal Excise Duty on sales load Auditors' remuneration Brokerage fee Bank charges Settlement charges Withholding tax Capital gain tax Printing charges Legal fees Mutual fund rating fee Others 7 CONTINGENCIES AND COMMITMENTS There were no contingencies and commitments as at September 30, 2017 and June 30 ,2017. 8 TAXATION The income of the Fund is exempt from income tax as per clause 99 of part I of the Second Schedule to the Income Tax Ordinance, 2001 subject to the condition that not less than ninety percent of its accounting income for the year, as reduced by capital gains, whether realised or unrealised, is distributed to the unit holders as cash dividend. The management intends to distribute 90 percent of the Fund's net accounting income earned by the year end as cash dividend to the unit holders. Accordingly, no provision in respect of taxation has been made in this condensed interim financial information. The Fund is also exempt from the provisions of section 113 (minimum tax) under clause 11A of Part IV of the Second Schedule to the Income Tax Ordinance, 2001. 9 PROVISION FOR WORKERS' WELFARE FUNDPROVISION FOR SINDH WORKERS' WELFARE FUND As a consequence of the 18th amendment to the Constitution of Pakistan, in May 2015 the Sindh Workers' Welfare Fund Act, 2014 (SWWF Act) had been passed by the government of Sindh as a result of which every industrial establishment located in the Province of Sindh, the total income of which in any accounting year is not less than Rs 0.50 million, is required to pay Sindh Workers' Welfare Fund (SWWF) in respect of that year a sum equal to two percent of such income. The matter was taken up by the MUFAP with the Sindh Revenue Board (SRB) collectively on behalf of various asset management companies and their CISs whereby it was contested that mutual funds should be excluded from the ambit of the SWWF Act as these were not industrial establishments but were pass through investment vehicles and did not employ workers. The SRB held that mutual funds were included in the definition of financial institutions as per the Financial Institution (Recovery of Finances) Ordinance, 2001 and were, hence, required to register and pay SWWF under the SWWF Act. Thereafter, MUFAP has taken up the matter with the Sindh Finance Ministry to have CISs / mutual funds excluded from the applicability of SWWF. In view of the above developments regarding the applicability of SWWF on CISs / mutual funds, MUFAP on January 12, 2017 recommended all its members that as a matter of abundant caution the provision in respect of SWWF should be made on a prudent basis with effect from the date of enactment of the Sindh WWF Act, 2014 (i.e. starting from May 21, 2015). Quarterly Report Page 17
19. NAFA STOCK FUND Had the provision for SWWF not been recorded in the financial statements of the Fund , the net asset value of the Fund as at September 30, 2017 would have been higher by Re 0.1058 per unit. 10 SELLING AND MARKETING EXPENSES In pursuance to Regulation 60(3)(V), selling and marketing expense is being charged to the fund having compliance with the conditions laid down by the regulator. 11 TOTAL EXPENSE RATIO Total expense ratio (all the expenses incurred during the period divided by Average net assets value for the period) is 3.12% p.a. including 0.37% representing government levies on collective Investment scheme such as Sales tax, Sindh Worker’s Welfare Fund and Securities & Exchange Commission of Pakistan fee for the period. 12 EARNINGS PER UNIT Earnings per unit (EPU) has not been disclosed as in the opinion of the management, determination of weighted average units for calculating EPU is not practicable. 13 TRANSACTIONS WITH CONNECTED PERSONSTRANSACTIONS WITH CONNECTED PERSONS 13.1 Connected persons include NBP Fullerton Asset Management Limited being the Management Company (NAFA), Central Depository Company of Pakistan Limited (CDC) being the Trustee, National Bank of Pakistan (NBP) and its connected persons, and Alexandra Fund Management Pte. Limited being the sponsors, NAFA Pension Fund, NAFA Provident Fund Trust being the associates of the Management Company, other collective investment schemes managed by the Management Company and directors and officers of the Management Company, any person or company beneficially owning directly or indirectly ten percent or more of the capital of the Management Company or the net assets of the Fund and unit holders holding 10 percent or more units of the Fund. 13.2 Remuneration to the Management Company and Trustee is determined in accordance with the provisions of the NBFC Regulations and the Trust Deed respectively. 13.3 The details of significant transactions and balances with connected persons at period are as follows: Un-audited Quarter ended September 30, 2017 Un-audited Quarter ended September 30, 2016 ------(Rupees in ‘000)-----13.4 Details of the transactions with connected persons are as follows: NBP Fullerton Asset Management Limited - Management Company Management fee expense for the period Sindh Sales Tax on remuneration of the Management Company Accounting and operational expenses Selling and marketing expenses Sales load Units issued / transferred In 3,213 units (September 30, 2016: Nil units) Units redeemed / transferred out 3,677,712 units (September 30, 2016: Nil units) Employees of the Management Company Units issued / transferred In 501,621 units (September 30, 2016: 202,289 units) Units redeemed / transferred out 507,509 units (September 30, 2016: 571,994 units) Page 18 81,329 10,573 4,066 16,266 6,640 46,915 6,099 2,346 - 47 - 60,000 - 7,809 2,880 7,792 7,880 Quarterly Report
20. NAFA STOCK FUND Un-audited Quarter ended September 30 , 2017 Central Depository Company of Pakistan Limited - Trustee Remuneration Sales tax on remuneration CDS Charges Un-audited Quarter ended September 30, 2016 ------(Rupees in ‘000)-----4,318 561 184 2,598 338 184 NBP Employee Pension Fund Units Issued / Transferred in 46,725 units (September 30, 2016: Nil units) 689 - Taurus Securities Limited Brokerage 345 100 2 400 Dr Amjad Waheed - CEO Units Issued / Transferred in 130 units (September 30, 2016: 27,963 units) Units redeemed / transferred out 64,586 units (September 30, 2016: NIl units) 1,000 - Mr Muhammad Murtaza Ali - Company secretary / COO Units Issued / Transferred in : Nil units (September 30, 2016: 821 units) - 12 Mr Khalid Mehmood - CFO Units Issued / Transferred in 43 units (September 30, 2016: 69,162 units) 1 1,000 Mr Kamal. A. Chinoy - Director Units Issued / Transferred in 1,646 units (September 30, 2016: Nil units) 24 Jubilee Life Insurance Company Limited (Common Directorship with the Management Company) Units issued: Nil units (September 30, 2016: 6,177,729 units) - National Fullerton Asset Management Limited - Employees provident Fund Units Issued / Transferred in 119,194 units (September 30, 2016: Nil units) Units redeemed / transferred out 645,360 units (September 30, 2016: NIl units) 88,437 1,880 - 9,696 - BYCO Petroleum Pakistan Limited - Employee Provident Fund (entity managed by NAFA) Units Issued / Transferred in 805 units (September 30, 2016: 323,730 units) 12 4,446 BYCO Oil Pakistan Limited - Employee Provident Fund (entity managed by NAFA) Units Issued / Transferred in Nil units (September 30, 2016: 101,443 units) - 1,395 Summit Bank Limited Units Issued / Transferred in 475 units (September 30, 2016: Nil units) Bank Profit 7 6 - ** Askari Bank Limited Bank Profit 50 - ** Bank Islami Pakistan Limited Bank Profit 23 - 8 - 14 - **Prosperity Weaving Mills Issue of 564 units (September 30, 2016: Nil units) **Pakistan Mobile Communications Limited Provident Fund Issue of 922 units (September 30, 2016: Nil units) Quarterly Report Page 19