Engro Corporation Limited has announced an investment of up to Rs 7.5 billion in the telecom sector.
The board of directors of Engro Corporation has approved the investment in Enfrashare which is a wholly owned subsidiary of Engro Infiniti Pvt Ltd which in turn is a part of the Engro Group of Companies.
Enfrashare started its operations in November 2018 and is headquartered in Islamabad.
According to the notification to PSX, Enfrashare will develop potential business opportunities in this vertical and accelerate the development of the country’s connectivity infrastructure which will provide an opportunity for people to be part of the new digital era.
As an initial investment to facilitate mobile network operators (MNO’s) and other telecom operators, Enfrashare shall undertake:
a) Acquisition, construction, and provision of shared telecommunication towers of 3G/4G coverage and capacity enhancements.
b) Provision of telecommunications/data related infrastructure
c) Provision of related services, including efficient energy solutions, modernized operations and maintenance, and state of the art network monitoring solutions.
The provision of the above services by Enfrashare will help reduce the operator’s capital investment on passive infrastructure, allowing them to focus on their core business and improve connectivity.
Engro Corporation Q1 Results
Engro Corporation announced its financial results for the first quarter that ended on March 31st, 2019.
The company reported a profit of Rs. 6.56 billion, showing a growth of 4% as compared to Rs. 6.83 million for the prior period.
The overall consolidated revenue grew by 21% to Rs. 40.64 billion in comparison to Rs. 33.52 billion in the prior period, driven by higher Urea sales in the Fertilizer business.
The cost of sales was reported at Rs. 28.64 billion, up by 30.42% as compared with Rs. 21.96 billion in the corresponding period which took the gross profit to Rs. 12 billion against Rs. 11.55 billion in last year.
On a standalone basis, the company posted a profit after tax (PAT) of PKR 3.83 billion against Rs. 3.14 billion for the same period last year, translating into an EPS of PKR 7.32 per share. The company announced an interim cash dividend of PKR 7.00 per share for the first quarter.
The company saw 61% increase in administrative expenses to Rs1.34 billion. Moreover, selling and distribution expenses decreased to Rs. 1.74 billion from Rs. 1.83 billion. Finance cost of the company was posted at Rs 1.15 billion, up by 5.74% from Rs 1.22 billion with other income stated at Rs 2.34 billion against Rs 2.63 billion.
ENGRO’s shares at the bourse were trading at Rs321.45, down by Rs1.56 or -0.48% with a turnover of 247,100 shares in the first trading session of Friday.
Engro Corporation, in light of its long-term strategy, has streamlined its businesses in four verticals namely Food & Agriculture Output, Energy & Related Infrastructure, Petrochemicals and Telecommunications Infrastructure; focused on creating value and helping resolve the pressing issues of Pakistan.
Furthermore, to continue building on Engro’s experience in the Petrochemical sector and keeping with its strategic ambitions that the company will seek investment opportunities in this vertical, the Board of Directors approved the commencement of a feasibility study of a polypropylene facility based on a propane dehydrogenation plant.
This will also enable the company to initiate discussions with potential partners and/or stakeholders for developing this project. Investment in the Petrochemical sector will create opportunities for both substituting the imports & enhancing the export potential, thus help in building foreign currency reserves of the country.
Simultaneously with a view to expand its footprint outside Pakistan and to explore potential trading opportunities, the Board has also approved the acquisition of 100% shares of Engro Eximp FZE, a wholly owned subsidiary of Engro Fertilizers Limited, for PKR1.76 Billion (subject to adjustments at the date of closing of the transaction and corporate approvals).