Karachi October 20 2021: The Board of Directors of Ghani Chemical Industries Limited (GCIL/ one of the subsidiary Companies and the largest manufacturer of medical and industrial gases in Pakistan) in their meeting held on October 16, 2021 has decided to increase the paid up capital by the way of 6.5135971% Right Issue for every hundred existing ordinary shares at Rs. 40/- per share (including premium of Rs. 30/- per share), as per information shared by the company at Pakistan Stock Exchange (PSX).
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The Board of Directors of the Company (Ghani Global Holdings Limited) will consider the subscription of above said Right Issue amounting to Rs. 297,801,640/- in their meeting being held on October 27, 2021.
Ghani Chemical Industries Limited (subsidiary company)
Ghani Chemical Industries Limited (GCIL) is engaged in manufacturing and sale of industrial and medical gases and chemicals. Ghani Global Holding owns 74.45 percent of Ghani Chemical Limited while Value of investments based on net assets shown in the audited financial statements for the year ended June 30, 2021 Rs.2,168.271 million.
Sales and end result performance of this subsidiary has considerably increased as compared with the same period of last year.
Annual sales of the company for the year ended June 2021, closed at Rs. 4,350 million as compared to last year June 2020, sales of Rs. 2,330 million which is showing tremendous increase of 86.5%. Gross profit has jumped from Rs. 494 million to Rs. 1,657 million showing increase of Rs. 1163 million, depicting an increase of 236%, in terms of percentage it has improved from 24% to 43%, due to increase in sales volume as well as increase in average selling price of the products. Distribution expenses and administrative expenses also decreased in terms of percentage to sales from 12% to 8%, and 6% to 4%, respectively. Company’s operating profit year ended June, 2021, is amounting to Rs. 1,175 million as compared to last year’s operating profit of Rs. 97 million showing increase of Rs. 1,077 million, depicting increase of 1,110%. Financial cost of the company also decreased from Rs. 320 million to Rs. 208 million showing decrease of 35%, having positive impact on the bottom line proftability of the company. Net profit of the company has jumped from loss of Rs. 160 million to profit of Rs. 691 million i.e in terms of percentage from net profit ratio of -8% to 18%. Alhamdulillah, accordingly, EPS of company has increased from Rs. (1.22) to Rs. 4.88.
Company is managing its repayments against the long term loans timely. Return on capital employed has improved from 3% to 28%. In financial, Current ratio of the company has improved from 0.72 to 1.03. Debtors days has also improved i.e. debtors days decreased from 97 days to 56 days. Short term borrowing of the company has been reduced by Rs. 455 million i.e. from Rs. 1,292M in June 2020 to Rs. 837 million in June 2021. Debt equity ratio also improved from 55:45 to 43:57.
As a major breakthrough, after long term sales contract of 5 years with Attock Refinery, the subsidiary company has succeeded to enter into long- term sales contract for a period of 15 years with Engro Polymer & Chemicals Limited, Port Qasim, Karachi and supply against this contract is expected to be commence during second quarter of financial year. To meet the expected increase in demand of industrial and medical gases the subsidiary is setting up its 4th ASU plant in Port Qasim. This subsidiary (being one of the largest manufacturer of industrial and medical gases in Pakistan) played a vital role to meet the increased demand of Medical Oxygen for COVID pandemic with close liaison with Government departments and Hospitals. To meet the requirements of funds for repayment of borrowings and working capital, the board of directors of this subsidiary during December 2020, decided to increase paid up capital of the Company for Rs. 385.250 million by further issue of 38.525 million ordinary shares i.e. 33.5% right shares at par value of Rs. 10 per share. In compliance with special resolution passed by the shareholders of Ghani Global Holdings Limited (GGL) in Extra-Ordinary General Meeting held on September 05, 2020, the GGL (being majority shareholder) declined to subscribe this right issue. Thereafter the board of directors of this subsidiary offered the declined portion of right issue to other existing shareholders and employees of this subsidiary and its associated company.
