13,316

13,316A choppy day at the Karachi Stock Exchange with the index making a low of 13,201, a high of 13,346 and closing up at 13,316. OGDC continued its gains and made a high of 120.90. Oil has hit $98 again. Upside resistance is 13,360-13,470.

News : Adamjee Insurance Company Limited proposes to hold an extraordinary general meeting on Thursday, to seek shareholders’ approval for raising the value of its investments on the balance sheet from book value to ‘mark-to-market’ prices. That would give it a huge windfall of realised capital gains.As at the close of financial year December 2006, investments were carried on the books of the company at Rs4.503 billion, while the market value was calculated at almost twice that figure at Rs8.062 billion.Adamjee’s investment in 11 million shares of associated company– MCB Bank Limited (before acquisition of more shares earlier this year) alone produces capital gains of Rs2.3 billion, given the value of Rs1.4 billion at which the stocks stand in the books and market value of Rs3.7 billion based on the MCB stock price of Rs338 on Monday.

Analysts said numerous companies were opting to convert their ‘unrealised gains’ into ‘realised gains’, mainly as a means to pre-empt levy of capital gains tax, if at all it materialised.The attempt would provide such companies with one time gain. The government has granted exemption of tax on capital gains till June 30, 2008, but analysts contend that for companies that close their financial year not in June — but December, would have to capture the capital gains before December end.In case they do not do so, such companies would be liable to levy of tax, in the unlikely event of the government deciding not to extend the exemption beyond June 30, 2008… Dawn

Upper Caps : Adamjee Insurance / Arif Habib Ltd

Market Low : 13,201.58  High : 13,346.85

Market Close : 13,316.73 — 76.86 points up  

source: karachistockmarket.blogsome.com

Filed under Daily Market News, KSE Stocks



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