By: Din Capital (Pvt.) Ltd.
+92- 3246 8741
After successful Public Offerings of UBL and PPL, OGDCL has stepped in contest with positive expectations to receive awe-inspiring response from its potential investors. The privatization commission has declared 7.5% ordinary shares of OGDCL to be floated on 5th November 2014.
OGDCL will float 322mn shares in its secondary offering which represents 7.5% of the total share capital of the company. The Government is expected to raise PKR 84bn from this offering. This offer is applicable to foreign institutional investors, domestic institutional investors, high net worth individuals, general public, and employees of the company.
Shares of OGDCL will be offered through combined book building process to local and foreign institutional investors. The foreign investors would have the option to purchase ordinary shares or GDR’s. Privatization commission has setup a roadshow on 2nd October 2014 in London. Later, the offering will proceed to general public and company employees at the price settled at book building process.
At present, Government of Pakistan possess 75% ownership i.e. 3224mn shares while employee empowerment trust holds 10% shares. The remaining 15% shares is free float in market which is likely to increase to 22.5% after successful public offering.
As expected from recent offerings of PPL and UBL which initiated at discount, the floor price of OGDCL is kept at a discount price of PKR 216 per share.
OGDC posted earnings of 28.3bn as against 33.6bn last year during the same period. This results in decline of EPS by 16%YoY to PKR 6.58/sh i.e. against market expectations. In spite of growth in volumes, OGDC’s net revenues increased moderately by 3%YoY owing to fall in Arab light prices by 5%YoY while PKR appreciated by 3%YoY